Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Lynn who wrote (56611)	4/10/1999 10:05:00 AM
From: rupert1	Read Replies (2) \| Respond to of 97611

Lynn: Given Mason's lack of credibility, a few scenarios are possible if the 15 cents is not a straightforward pre-announcement. Basically, I think $200-300 million is missing in profitability, or charges, if 3 1/2% shortfall in expected revenues produces 50% shortfall in expected earnings. 1. 15 cents does include tax credits from the $2.9 billion still available. If so the actual operating earnings will be worse than 15 cents. 2. 15 cents does not include tax credits, some of them are available, and the 15 cents could be boosted by as much as the same 5 cents tax credits were used in 4Q. 3. 15 cents might include a "one-time loss" of the full $200 million Brazil devaluation issue which Mason spoke of in February (or more than $200 million). I had thought the loss would not be so great, but maybe it will. I would not have thought that such a loss would be deducted from the net earnings figure, but I may be wrong. If so, it "improves" the quality of that 15 cents because that $200 million or whatever it was will not have been due to a fall off in sales or profitability and will have been a one-time event. 4. 15 cents might include provision for more one-time losses having to do with additional cost-cutting measures, perhaps even inventory write-off. But I would have thought such measures would not be a direct charge on the net earnings. 5. 15 cents would be the worst case, absolutely rock-bottom figure allowing for upward adjustments in the next two weeks , to the 17-20 range.