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Camelot Portfolios, LLC  

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  • The Long And Mostly Short Of [View article]
    Well - I am always, always, did I say always suspicious of serial acquirers. I cut my teeth in the days of GE and Tyco and Danaher and . . . The moment the music stops they find that there are not enough chairs.

    At this point I can't confirm ConvertClassic's assertion that CRM acquisitions are done exclusively to cover losses. I do know with certainty, however, that Howard Schilit has proven again and again in his books that serial acquirers have learned to glean all the inherent accounting benefits that come with buying other companies. I am sure CRM is no different in this regard.
    Sep 19, 2012. 03:25 PM | 1 Like Like |Link to Comment
  • The Long And Mostly Short Of [View article]
    ConverClassic - Genius. (read that as genius period)
    Sep 19, 2012. 03:20 PM | 1 Like Like |Link to Comment
  • The Long And Mostly Short Of [View article]
    aWannabe - Great comments. You are correct that I did not update my FY 2013 revenue numbers. That was a mistake, however I think not likely to increase the intrinsic value calculation since I also assumed an immediate and permanent improvement in operating margins to 10%. Operating margins have been negative of late, though last quarter was around 12%. Point is that I think my rosy operating margin, likely more than compensated for my error in revenue numbers.

    Also good question on my revenue assumptions. I actually wanted to show all my calculations easily on a webpage and so used some shorthand assumptions. It is clear that at some point revenue growth will fall - whether abruptly or gradually I do not know. I always encourage folks to change assumptions in their own spreadsheet and see what happens. One further assumption I made was that revenue grows at 10% forever. I think that is a pretty aggressive assumption (one I don't advocate) since I usually put a 3-5% growth rate on my terminal numbers.

    Anyway, good comments! Ultimately, at these levels, mgmt must execute precisely . . . or else.
    Sep 19, 2012. 03:16 PM | 1 Like Like |Link to Comment
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