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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Kevin Podsiadlik who wrote (37126)	5/26/1999 12:47:00 PM
From: Mama Bear	Read Replies (2) \| Respond to of 122087

Oh puh-leeze. I'll be waiting for the commitment procedure to happen if Warren really pushed the buy button on SRCM. Think about it, does he ever buy stock in a company that has huge debt, no free cash flow from operations, no established business? Besides, doesn't BRK have an exemption from reporting their positions until the quarterlies are out? Barb

To: Kevin Podsiadlik who wrote (37126)	5/26/1999 1:17:00 PM
From: David Penfield	Read Replies (1) \| Respond to of 122087

Kevin - Warren Buffet investing in SRCM!! What a joke. Next we'll be hearing that he has bought CYOE as well!! SRCM doesn't satisfy his acquisition criteria (page 21 of BRK annual report at berkshirehathaway.com. In fact, SRCM has the exact opposite traits than some of these acquisition criteria: 1) SRCM is not a large purchase (over $50 million in before-tax earnings). 2) No demonstrated consistent earning power. Remember that future projections and turnarounds are of no interest to BRK. SRCM's story is built on future projections. 3) SRCM doesn't earn good returns on equity while employing little or not debt. As a matter of fact they don't earn anything while employing large amounts of debt. 4) SRCM is not a simple business. Warren has repeatedly said that he is not interested in technology that he doesn't understand. Also, 105,282 shares is at most a couple of million dollars. Mr. Buffett doesn't fool around with millions of dollars. He uses billions of dollars. If he was interested in SRCM he would just buy the whole company. David