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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (21496)	6/19/2005 4:09:33 AM
From: bruwin	Read Replies (2) \| Respond to of 78671

So Gannett (GCI) is in favour ? Well, the following may be of interest. A BIG negative, in my opinion, is the massive amount of INTANGIBLE ASSET that sits on GCI’s Balance Sheet. It amounts to over 65% of GCI’s Total Assets ! The thing about Intangibles is who knows what their "value" is because, invariably, the company has evaluated them. Next we notice that GCI’s price has been falling steadily from a high of $91 in April ’04 to its current $75. I suspect this is due to the recent falling off of Turnover, excessive long term debt, falling EPS and a poor showing in what GCI is earning from its Employment of Capital. One last consideration is GCI's current P/E of about 16. Based on a calculation I do, using a stock's EPS, DPS and best bank interest rate, I believe GCI's P/E should be in the region of about 10. Therefore, if GCI was exhibiting QUALITY fundamentals, it would be a "bargain" buy at P/E <= 10. I believe the same would apply to TRB. Of course, the above would mean little if one were ‘shorting’ these stocks ! But all this is just my opinion.