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

To: James Clarke who wrote (7078)	5/7/1999 4:13:00 PM
From: Michael Burry	Read Replies (2) \| Respond to of 78462

Re: ROIC My denominator is assets minus excess cash minus trade accounts payable minus accrued expenses plus PV of lease obligations My numerator is net income adjusted for 35% taxes plus goodwill amortization plus interest So the thing I'm missing is that I'm supposed to add back rent expense to the numerator if I add the PV of lease obligations to the denominator? That makes perfect sense. I'll have to read Security Analysis again to see how I came out of it thinking the way I did. It still decreases ROIC, but not to the degree I thought. I was just trying to get what my "cash return" on the ROIC would be. To me it seemed that if I was adding rent back in then that would not really be my cash return. I've still got to think on this. Thanks, Mike