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

To: robert b furman who wrote (72338)	2/15/2023 10:20:07 AM
From: E_K_S	Read Replies (2) \| Respond to of 78688

Re: LUMN Not sure but they are/working selling their legacy ILEC services. That has a bunch of Goodwill that must be charged off. Some of the Goodwill was written down in their last report and I suspect more next quarter too. Similar to CNDT, they had a one time write down (Goodwill) from the sale of one of their subsidiary companies. It impacted their earnings but was always on their balance sheet and at some point needed to be written down. Best to do it w/ a sale than just a flat unexpected write-down. The big issue w/ LUMN is their huge debt load. To pay that down from just FCF (takes years not months) is challenging. Now I hear that they may/could have a hard time rolling some of that debt over w/o paying a huge premium. Look at XRX and their cash flow that they generate from their legacy business. They also have some cloud stuff that is growing and their Debt/Equity at 0.85 is much more manageable. Carl Icahn did spin off some assets to CNDT along w/ Goodwill and some debt. So, I guess it is all about how you break up the assets, what you spin out and what is left. It is/was discussed a lot here that generally many of these spin offs piggyback huge debt obligations and other 'kitchen sink' obligations that make it difficult for the new going concern to be profitable (or even FCF positive). Not a good combination for spin off.