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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: BWAC who wrote (12111)11/18/2004 12:40:59 PM
From: Kirk ©  Respond to of 25522
 
"Point. Depreciation is an expense, it reduces your GAAP earnings. But since you have already invested cash in the asset, the depreciation throws off cash that is not recorded as earnings. "

Yes, but what matters is the stockholder equity. If that can grow despite goodwill going down, then I am very happy as you can't eat goodwill.

I've wondered if real estate is properly valued as an asset. I think Sears real estate was not properly valued hence the KMart asquisition, but that is another topic.

I agree I'd rather get a dividend than pay additional salary to Splinter at a tax rate favorable to him.



To: BWAC who wrote (12111)11/18/2004 4:54:11 PM
From: Cary Salsberg  Read Replies (2) | Respond to of 25522
 
RE: "But since you have already invested cash in the asset, the depreciation throws off cash that is not recorded as earnings."

Depreciation is a non cash expense that reduces taxable earnings and, possibly, cash tax payments.

Depreciation does not "throw off cash". Cash invested in an asset is negative cash flow, but depreciation is not positive cash flow.


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