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Strategies & Market Trends : BFT: Will the tulip craze ever break down? -- Ignore unavailable to you. Want to Upgrade?

To: Pancho Villa who wrote (129)	3/23/1998 11:16:00 AM
From: John Tais	Read Replies (1) \| Respond to of 650

Price to sales is the only measure that makes BFIT look good. I'd like to know how they report their sales. Are sales reported as the amount of money contracted for by the new members, or is it actual cash receipts? How do the members who quit and stop paying affect the reported sales of the company? It begins to look like cash flow is the only reliable figure. (and we know that is negative). The fact that insiders are not selling is a pretty scary thing. Any idea if there is another way they are getting money out of the company?

To: Pancho Villa who wrote (129)	3/23/1998 12:43:00 PM
From: Don Westermeyer	Respond to of 650

Pancho, I sure know what you mean about predicting stock price in the short term. I followed a company that recorded a large one time revenue as 'earnings' over the following three quarters. The stock skyrocketed as the P/E went into the single digits, even though the company was recording a large operating loss. I watched the stock almost double as investors couldn't wait to jump into the stock. Of course the stock has not given up all those gains and more as the 'revenue' has been fully accounted for now. The fools that bought can't understand what is going on, but next earnings they will understand. Hopefully we won't have to sit through a double in BFIT!

To: Pancho Villa who wrote (129)	3/23/1998 1:34:00 PM
From: Witling	Read Replies (1) \| Respond to of 650

Pancho or anyone, Does INVESTING normally include capital items like plant and equipment? Should the bulk of the investing category be amortized purchase expenses, or capital gains in the event of a sale? Also, if a net $16 million went into property and equipment, would you expect to see an increase in property and equipment assets before depreciation? CASH FLOW ... INVESTING: Purchases and construction of property and equipment (27,065) (20,612) (22,469) Proceeds from sale of property and equipment 10,946 Reserve fund deposit refunded (paid) pursuant to securitization facility 10,000 (20,000) Other, net 833 353 -------- -------- -------- Cash used in investing activities (16,119) (9,779) (42,116) DECEMBER 31, ------------------ 1997 1996 -------- -------- ASSETS ... Property and equipment, at cost: Land 21,667 22,550 Buildings 109,613 108,361 Leasehold improvements 402,503 400,340 Equipment and furnishings 91,958 99,073 -------- -------- 625,741 630,324 Accumulated depreciation and amortization 314,544 304,865 -------- -------- Net property and equipment 311,197 325,459 ps. Thank you, Pancho, for the illuminating deconstruction of the 10K. Capitalized sales commissions must be the work of the genius who invented goodwill for purchase accounting.