bill9300's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/172133/comments http://seekingalpha.com/article/130014-amazon-dirty-little-secrets-persist?source=feed#comment-456061 456061

seekingalpha.com/artic...]]> Wed, 08 Apr 2009 09:45:35 -0400

seekingalpha.com/artic...]]> http://seekingalpha.com/article/83852-cash-flows-earnings-quality-stock-returns?source=feed#comment-200215 200215
seekingalpha.com/artic...]]> Mon, 07 Jul 2008 18:42:10 -0400
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www.istockanalyst.com/...~title_Amazon---Is-~qu...]]> Mon, 07 Jul 2008 18:32:23 -0400
www.istockanalyst.com/...~title_Amazon---Is-~qu...]]> http://seekingalpha.com/article/83852-cash-flows-earnings-quality-stock-returns?source=feed#comment-200207 200207

Check out this article- on Amazon's Free Cash Flow and how an GS's analyst put a 20 times multiple on it to justify a valuation.


www.istockanalyst.com/...~title_Amazon---Is-~qu...]]> Mon, 07 Jul 2008 18:24:51 -0400

Check out this article- on Amazon's Free Cash Flow and how an GS's analyst put a 20 times multiple on it to justify a valuation.


www.istockanalyst.com/...~title_Amazon---Is-~qu...]]> http://seekingalpha.com/article/83512-rim-misses-estimates-palms-revenue-also-down?source=feed#comment-198016 198016
Market Cap of $66bn, a P/E of 43 Valued at almost 10 times sales. 100% growth is over.]]> Thu, 03 Jul 2008 11:55:45 -0400
Market Cap of $66bn, a P/E of 43 Valued at almost 10 times sales. 100% growth is over.]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192640 192640

Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q WORTH $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml]]> Wed, 25 Jun 2008 12:03:35 -0400

Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q WORTH $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192634 192634

Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q WORTH $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml]]> Wed, 25 Jun 2008 11:58:54 -0400

Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q WORTH $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192622 192622




Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q worth $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml

Difference between the formulas ......................... million

]]> Wed, 25 Jun 2008 11:50:58 -0400




Is AMZN’s FCF from Short-term Cash held from Customers' Sales December Q, paid to suppliers in the March 2008 Q worth $16bn in Market Valuation??? Remember this FCF, as many classify it, is not Net Income.



Goldman put a 20 X 2009 estimated FCF, to try to justify Amazon's valuation of $34bn. (2009?)



Amazon a company that earned $1.5bn in the past 6 years, a 2007 profit of $476ml and a P/E of 60+) How can "FCF" (aside from earnings) most of which is of POOR QUALITY be given such a outrageous valuation (20X).



From the Goldman recommendation-in the article-

"Trading at around 20X 2009E free cash flow, Goldman believes Amazon stock can outperform on rising revenue if margins are only flat; RAPID REVENUE GROWTH ASSISTS FREE CASH FLOW BECAUSE AMAZON USES ITS IMPROVING CATEGORY SHARE TO NEGOTIATE LONGER PAYMENT TO SUPPLIERS in categories such as books..."





"FCF" for 2007 according to their definition (computation 1- in the article) came out to $1.181bn, as compared to (computation 2) the FCF beginning with Net Income , of $496ml a difference of $685ml.



Do you feel it is proper or fair to value this $685ml at $13bn, ($685ml x 20 = $13.7bn?) when it all vanished in the following quarter?



Two methods of computing Amazon's FCF for 2007

1) Cash Flow From Operations...........$... bn.

Less Capital Expenditure..............

Free Cash Flow.....................

2) Net Income...................

Plus Depreciation.............

Less Capital Expenditures.............

Free Cash Flow..................... ml

Difference between the formulas ......................... million

]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192345 192345
Using AMZN’s method of computing FCF it appears they had a $393ml reduction in FCF for
the 12 mos ended 3/31/08 compared to 12/31/07.


finance.google.com/fin...

FCF, for the 12 months ending march 31, 2008
Cash from Operating Activities
3/31/08........-645ml
12/31/07.... 1,148
9/30/07.........237
6/30/07..........299
Total.................... 1.039bn
Less Cap Exp....... -251

FCF-12 Mos/End 3/31/08.........$788ml
FCF-12 Mos end 12/31/07........1,181m...

Decrease in FCF...................... $393ml
]]> Wed, 25 Jun 2008 01:39:35 -0400
Using AMZN’s method of computing FCF it appears they had a $393ml reduction in FCF for
the 12 mos ended 3/31/08 compared to 12/31/07.


finance.google.com/fin...

FCF, for the 12 months ending march 31, 2008
Cash from Operating Activities
3/31/08........-645ml
12/31/07.... 1,148
9/30/07.........237
6/30/07..........299
Total.................... 1.039bn
Less Cap Exp....... -251

FCF-12 Mos/End 3/31/08.........$788ml
FCF-12 Mos end 12/31/07........1,181m...

Decrease in FCF...................... $393ml
]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192344 192344 Using AMZN’s method of computing FCF: it appears they had a $393ml reduction in FCF for the 12 mos ended 3/31/08 compared to 12/31/07. It was mostly from the $-366ml difference between
March 31, 08 and 07s, Cash from Operating Activities. (2008) $-645ml - $-279= $-366ml). This was because of the large increase in A/Ps of
$1.2bn 2007/ 2006, with the Short-Term Cash from December Q sales paid to
suppliers in the March Q. (HOW CAN YOU CONSIDER THAT FCF?)


Instead of using fictional companies, why don’t you look at the numbers that Amazon issued in their Statements of Cash Flow. As I said putting billions of $s of valuation on their “FCF” is wrong, meaningless, and I repeat Warren Buffett would not consider the “FCF” from A/P as FCF. The company has little profit and is trying to justify their valuation of $33bn by use of this “FCF”.


finance.google.com/fin...

FCF, for the 12 months ending March 31, 2008
Cash from Operating Activities

3/31/08........-645ml
12/31/07.....1,148
9/30/07..........237
6/30/07..........299
Total....................
Less Cap Exp.......-251
FCF-12 Mos ended 3/31/08.........$788ml
FCF-12 Mos ended12/31/07...... ..1,181ml
Decrease in FCF......................

Above is their method of calculation, beginning with CF from operations.

One analyst projected $1.5bn in FCF for the year, I think he should re-evaluate his projection and thinking.
]]> Wed, 25 Jun 2008 01:33:40 -0400 Using AMZN’s method of computing FCF: it appears they had a $393ml reduction in FCF for the 12 mos ended 3/31/08 compared to 12/31/07. It was mostly from the $-366ml difference between
March 31, 08 and 07s, Cash from Operating Activities. (2008) $-645ml - $-279= $-366ml). This was because of the large increase in A/Ps of
$1.2bn 2007/ 2006, with the Short-Term Cash from December Q sales paid to
suppliers in the March Q. (HOW CAN YOU CONSIDER THAT FCF?)


Instead of using fictional companies, why don’t you look at the numbers that Amazon issued in their Statements of Cash Flow. As I said putting billions of $s of valuation on their “FCF” is wrong, meaningless, and I repeat Warren Buffett would not consider the “FCF” from A/P as FCF. The company has little profit and is trying to justify their valuation of $33bn by use of this “FCF”.


finance.google.com/fin...

FCF, for the 12 months ending March 31, 2008
Cash from Operating Activities

3/31/08........-645ml
12/31/07.....1,148
9/30/07..........237
6/30/07..........299
Total....................
Less Cap Exp.......-251
FCF-12 Mos ended 3/31/08.........$788ml
FCF-12 Mos ended12/31/07...... ..1,181ml
Decrease in FCF......................

Above is their method of calculation, beginning with CF from operations.

One analyst projected $1.5bn in FCF for the year, I think he should re-evaluate his projection and thinking.
]]> http://seekingalpha.com/article/82311-amazon-is-free-cash-flow-more-important-than-net-income?source=feed#comment-192218 192218
How much market valuation is that FCF worth?


Company makes very little profit, a total of $1.5bn in the past 6 years
P/E 67- very high

Market Valuation $33bn

Their Total Debt has been increasing every year,

FCF seems to be a way to pump up or support the stock price

You said Berkshire recognized the valued that float, he used a more meaningful definition to measure it, as was mentioned in the article.

The way some analysts, Amazon, FCF it can be easily manupulated.

For example in the December quarter, if they obtained better terms on $100ml of A/Ps and delayed payment until January their "FCF" (their definition) would have been $100ml higher, $1.281bn rather than $1.181bn.
Would that add'l $100ml be meaningful? (except for some investment income)?



]]> Tue, 24 Jun 2008 21:04:35 -0400
How much market valuation is that FCF worth?


Company makes very little profit, a total of $1.5bn in the past 6 years
P/E 67- very high

Market Valuation $33bn

Their Total Debt has been increasing every year,

FCF seems to be a way to pump up or support the stock price

You said Berkshire recognized the valued that float, he used a more meaningful definition to measure it, as was mentioned in the article.

The way some analysts, Amazon, FCF it can be easily manupulated.

For example in the December quarter, if they obtained better terms on $100ml of A/Ps and delayed payment until January their "FCF" (their definition) would have been $100ml higher, $1.281bn rather than $1.181bn.
Would that add'l $100ml be meaningful? (except for some investment income)?



]]> http://seekingalpha.com/article/80690-adjusted-for-labor-force-growth-today-s-jobless-claims-are-below-average?source=feed#comment-185419 185419
someone posted-
"...As far as statistics showing that employment is steady and that there are fewer claims for unemployment for the months of..... That argument can be shot down through the common observation of people who have exhausted their unemployment claims and still can't find work. The longer a person is unemployed, the longer it takes to find employment; or so that is what they say! The areas of manufacturing, construction, and investment banking are now the "weak" sectors of the economy and are facing more and more lay-off's. .."]]> Sat, 14 Jun 2008 08:09:27 -0400
someone posted-
"...As far as statistics showing that employment is steady and that there are fewer claims for unemployment for the months of..... That argument can be shot down through the common observation of people who have exhausted their unemployment claims and still can't find work. The longer a person is unemployed, the longer it takes to find employment; or so that is what they say! The areas of manufacturing, construction, and investment banking are now the "weak" sectors of the economy and are facing more and more lay-off's. .."]]> http://seekingalpha.com/article/81206-canaccord-analyst-research-in-motion-to-hit-c-200?source=feed#comment-185413 185413
At a price of $200/sh the company would be valued at over $110bn.

Sale and Profits for the past 12 months were, $6bn and $1.3bn earning. Currently the stock is priced to more than perfection, with an unknown future.

The numbers are like the bubbles of 2000- currently RIM has a p/e of over 60 and is valued at over 13 times annual sales.




]]> Sat, 14 Jun 2008 07:41:00 -0400
At a price of $200/sh the company would be valued at over $110bn.

Sale and Profits for the past 12 months were, $6bn and $1.3bn earning. Currently the stock is priced to more than perfection, with an unknown future.

The numbers are like the bubbles of 2000- currently RIM has a p/e of over 60 and is valued at over 13 times annual sales.




]]> http://seekingalpha.com/article/80011-goldman-analyst-incredibly-bullish-on-research-in-motion?source=feed#comment-178979 178979
They were also very bullish on Enron, said Enron “Best of the Best”.

GS has a large holdings in RIMM, at 3/31/08 they owned 8ml shares after dumping 2.7 ml share in the Q.

They seemed to have ignored Valuation and put a $163/ target price on, that would give RIM a Valuation of over $90 billion, a little high for a company with $6bn in sales, slowing growth and a P/E of 60 now.

Will RIM ever be able to justify a $90bn valuation, who know what the future will bring with all of the competition out there?

GOLDMAN SACHS, October 9, 2001 -

Recommended List Large-Cap Growth
Price:US$33.45 Target price: US$48 S&P 500: 1051
United States Enron Corp. (ENE)

Gas & Power Convergence

Still the best of the best. With perceptions far below reality, we see major catalysts in third-quarter results and increased
disclosure in coming months. We strongly reiterate our Recommended List rating and our conviction in high and sustained growth prospects, even though we have cut 2002 EPS to $2.15 and our price target to $48. We expect Enron shares to recover dramatically in the coming months. We view the current period as an extremely rare opportunity to purchase the shares of a company that remains extremely well positioned to grow at a substantial rate and earn strong returns in the still-very-young and evolving energy convergence space.

We strongly reiterate our Recommended List rating on Enron stock. We spoke recently with top management including the CEO, CFO, chief accounting officer, and the head of wholesale services.

We challenged top management on the wide range of investor concerns that have weighed heavily on the shares and believe that the majority of market speculation is groundless, and that which has some truth to it, to be exaggerated.

Misconceptions abound and perceptions are far below reality, in our view We believe that investors have virtually given up on Enron (down 60% year to date) and its prospects based on the long list of extremely negative stories about the company and its financial condition.

The company's limited transparency on its sources of earnings, its cash flow, and financials in general has hurt investor perceptions as management has declined to be more specific in refuting outrageous claims that have assumed a life of their own.

We believe Enron's fundamentals are still strong despite the weak economy. We view Enron as one of the best companies in the economy, let alone among the companies in our energy convergence space. We are confident in the company's ability to grow earnings more than 20% annually for the next five years, despite its already large base.
www.actwin.com/kalostr...


]]> Wed, 04 Jun 2008 08:28:34 -0400
They were also very bullish on Enron, said Enron “Best of the Best”.

GS has a large holdings in RIMM, at 3/31/08 they owned 8ml shares after dumping 2.7 ml share in the Q.

They seemed to have ignored Valuation and put a $163/ target price on, that would give RIM a Valuation of over $90 billion, a little high for a company with $6bn in sales, slowing growth and a P/E of 60 now.

Will RIM ever be able to justify a $90bn valuation, who know what the future will bring with all of the competition out there?

GOLDMAN SACHS, October 9, 2001 -

Recommended List Large-Cap Growth
Price:US$33.45 Target price: US$48 S&P 500: 1051
United States Enron Corp. (ENE)

Gas & Power Convergence

Still the best of the best. With perceptions far below reality, we see major catalysts in third-quarter results and increased
disclosure in coming months. We strongly reiterate our Recommended List rating and our conviction in high and sustained growth prospects, even though we have cut 2002 EPS to $2.15 and our price target to $48. We expect Enron shares to recover dramatically in the coming months. We view the current period as an extremely rare opportunity to purchase the shares of a company that remains extremely well positioned to grow at a substantial rate and earn strong returns in the still-very-young and evolving energy convergence space.

We strongly reiterate our Recommended List rating on Enron stock. We spoke recently with top management including the CEO, CFO, chief accounting officer, and the head of wholesale services.

We challenged top management on the wide range of investor concerns that have weighed heavily on the shares and believe that the majority of market speculation is groundless, and that which has some truth to it, to be exaggerated.

Misconceptions abound and perceptions are far below reality, in our view We believe that investors have virtually given up on Enron (down 60% year to date) and its prospects based on the long list of extremely negative stories about the company and its financial condition.

The company's limited transparency on its sources of earnings, its cash flow, and financials in general has hurt investor perceptions as management has declined to be more specific in refuting outrageous claims that have assumed a life of their own.

We believe Enron's fundamentals are still strong despite the weak economy. We view Enron as one of the best companies in the economy, let alone among the companies in our energy convergence space. We are confident in the company's ability to grow earnings more than 20% annually for the next five years, despite its already large base.
www.actwin.com/kalostr...


]]> http://seekingalpha.com/article/79271-is-amazon-s-free-cash-flow-overstated?source=feed#comment-177696 177696
Point is- if you were evaluating a business to buy, how would you consider the Cash in Bank at Dec 31, that would be paid out during the next quarter? Would you pay multiples for it? Or would you be more interested in Net Income? (Which in Amazon's has very little of.

Is that so difficult to understand? check out the statement of Cash Flow and see how that large cash balance decreased over $1billion.

finance.yahoo.com/q/cf...



THE CPA JOURNAL

The Cash Flow Statement:
Problems with the Current Rules

By Neil S. Weiss and James G.S. Yang

...Concerning the concept of free cash flows, two points should be emphasized: First, increasing reliance is being placed on free cash flow numbers by a variety of users, including investor analysts, credit analysts, and finance and economics theoreticians. Second, as a result of the many users of free cash flow, a variety of definitions have been introduced for the determination of free cash flow....
The weaknesses with the cash flow statement can be divided into five sections:----
1) differences between commercial and industrial companies versus financial institutions; 2) problems with operating activities; 3) problems with investing activities; 4) problems with financing activities; and 5) the role of free cash flow. The authors offer potential solutions to these problems that could improve the cash flow statement.

The Role of Free Cash Flow-
... The concept of free cash flow was born for this reason. IT IS DEFINED AS CASH WITHOUT ANY RESTRICTIONS ON IT USE. It is available for any purpose at any time. It is similar to the concept of unappropriated retained earnings. Free cash flow has become increasingly important in financial statement analysis, yet the accounting profession has ignored it. ONE CURRENT PROBLEM WITH FREE CASH FLOW IS THAT IT HAS A NUMBER OF DEFINITIONS. As a result, different users may be using different definitions and drawing DIFFERENT CONCLUSIONS ABOUT A COMPANY’S PERFORMANCE....

* Cash provided by operations less capital expenditures
* Cash provided by operations less capital expenditures and dividends paid
* Net income plus depreciation less capital expenditures
* EBITDA less captial expenditures
* Earnings before interest and taxes (EBIT) multiplied by 1 minus the tax rate, plus depreciation and amortization less changes in operating working capital and less capital spending.....

The differences in definitions are based on key issues concerning what should be considered in determining free cash flow:------

.....Should it be before or after the adjustments for changes in operating assets and liabilities? Using a free cash flow figure based on funds-flow before adjustments for changes in operating assets and liabilities takes a long-run view. In the long run, the changes will vanish. Furthermore, these funds-flow numbers are not DISPORTED BY COMPANY PRACTICES SUCH AS DELAYING PAYMENT OF TRADE CREDITORS TO INFLATE CASH PROVIDED BY OPERATIONS....

www.nysscpa.org/printv...

]]> Sun, 01 Jun 2008 22:36:23 -0400
Point is- if you were evaluating a business to buy, how would you consider the Cash in Bank at Dec 31, that would be paid out during the next quarter? Would you pay multiples for it? Or would you be more interested in Net Income? (Which in Amazon's has very little of.

Is that so difficult to understand? check out the statement of Cash Flow and see how that large cash balance decreased over $1billion.

finance.yahoo.com/q/cf...



THE CPA JOURNAL

The Cash Flow Statement:
Problems with the Current Rules

By Neil S. Weiss and James G.S. Yang

...Concerning the concept of free cash flows, two points should be emphasized: First, increasing reliance is being placed on free cash flow numbers by a variety of users, including investor analysts, credit analysts, and finance and economics theoreticians. Second, as a result of the many users of free cash flow, a variety of definitions have been introduced for the determination of free cash flow....
The weaknesses with the cash flow statement can be divided into five sections:----
1) differences between commercial and industrial companies versus financial institutions; 2) problems with operating activities; 3) problems with investing activities; 4) problems with financing activities; and 5) the role of free cash flow. The authors offer potential solutions to these problems that could improve the cash flow statement.

The Role of Free Cash Flow-
... The concept of free cash flow was born for this reason. IT IS DEFINED AS CASH WITHOUT ANY RESTRICTIONS ON IT USE. It is available for any purpose at any time. It is similar to the concept of unappropriated retained earnings. Free cash flow has become increasingly important in financial statement analysis, yet the accounting profession has ignored it. ONE CURRENT PROBLEM WITH FREE CASH FLOW IS THAT IT HAS A NUMBER OF DEFINITIONS. As a result, different users may be using different definitions and drawing DIFFERENT CONCLUSIONS ABOUT A COMPANY’S PERFORMANCE....

* Cash provided by operations less capital expenditures
* Cash provided by operations less capital expenditures and dividends paid
* Net income plus depreciation less capital expenditures
* EBITDA less captial expenditures
* Earnings before interest and taxes (EBIT) multiplied by 1 minus the tax rate, plus depreciation and amortization less changes in operating working capital and less capital spending.....

The differences in definitions are based on key issues concerning what should be considered in determining free cash flow:------

.....Should it be before or after the adjustments for changes in operating assets and liabilities? Using a free cash flow figure based on funds-flow before adjustments for changes in operating assets and liabilities takes a long-run view. In the long run, the changes will vanish. Furthermore, these funds-flow numbers are not DISPORTED BY COMPANY PRACTICES SUCH AS DELAYING PAYMENT OF TRADE CREDITORS TO INFLATE CASH PROVIDED BY OPERATIONS....

www.nysscpa.org/printv...

]]> http://seekingalpha.com/article/79271-is-amazon-s-free-cash-flow-overstated?source=feed#comment-177511 177511
Think about this, for Amazon’s December Quarter- if AMZN received longer payment term on say $300ml of Accounts Payables, of which they paid in December and instead paid this $300ml in January 2008, this would have increased cash at Dec 31, 2007 by $300ml, and also Total Cash Flow From Operating Activities. Using your definition, FCF would have also increase by $300ml- (Net Income would remain the same).

It is correct that CFFOA would be increased by $300ml, but $300ml should not be considered as a part of FCF, it will be used to pay bills so how can it be considered FCF? Including this $300ml in FCF is wrong, it is not FCF. It is true that Amazon earns interest income from the float, but this $300ml is not FCF.

finance.yahoo.com/q/cf...

To consider FCF in valuing a business, you should use the FCF definition that Warren Buffett uses, he would laugh at the one the company and many analysts use.

“Structural free cash flow [SFCF] -- what Warren Buffett calls "owner's earnings" -- is net income from operations plus depreciation and amortization minus capital expenditures.”

You are confusing Cash Flow with Free Cash Flow]]> Sun, 01 Jun 2008 10:44:24 -0400
Think about this, for Amazon’s December Quarter- if AMZN received longer payment term on say $300ml of Accounts Payables, of which they paid in December and instead paid this $300ml in January 2008, this would have increased cash at Dec 31, 2007 by $300ml, and also Total Cash Flow From Operating Activities. Using your definition, FCF would have also increase by $300ml- (Net Income would remain the same).

It is correct that CFFOA would be increased by $300ml, but $300ml should not be considered as a part of FCF, it will be used to pay bills so how can it be considered FCF? Including this $300ml in FCF is wrong, it is not FCF. It is true that Amazon earns interest income from the float, but this $300ml is not FCF.

finance.yahoo.com/q/cf...

To consider FCF in valuing a business, you should use the FCF definition that Warren Buffett uses, he would laugh at the one the company and many analysts use.

“Structural free cash flow [SFCF] -- what Warren Buffett calls "owner's earnings" -- is net income from operations plus depreciation and amortization minus capital expenditures.”

You are confusing Cash Flow with Free Cash Flow]]> http://seekingalpha.com/article/79271-is-amazon-s-free-cash-flow-overstated?source=feed#comment-175800 175800
GOLDMAN SACHS, October 9, 2001 -

Recommended List Large-Cap Growth
Price:US$33.45 Target price: US$48 S&P 500: 1051
United States Enron Corp. (ENE)

Gas & Power Convergence
Still the best of the best. With perceptions far below reality, we see major catalysts in third-quarter results and increased
disclosure in coming months. We strongly reiterate our Recommended List rating and our conviction in high and sustained growth prospects, even though we have cut 2002 EPS to $2.15 and our price target to $48. We expect Enron shares to recover dramatically in the coming months. We view the current period as an extremely rare opportunity to purchase the shares of a company that remains extremely well positioned to grow at a substantial rate and earn strong returns in the still-very-young and evolving energy convergence space.

We strongly reiterate our Recommended List rating on Enron stock. We spoke recently with top management including the CEO, CFO, chief accounting officer, and the head of wholesale services.

We challenged top management on the wide range of investor concerns that have weighed heavily on the shares and believe that the majority of market speculation is groundless, and that which has some truth to it, to be exaggerated.

Misconceptions abound and perceptions are far below reality, in our view We believe that investors have virtually given up on Enron (down 60% year to date) and its prospects based on the long list of extremely negative stories about the company and its financial condition.

The company's limited transparency on its sources of earnings, its cash flow, and financials in general has hurt investor perceptions as management has declined to be more specific in refuting outrageous claims that have assumed a life of their own.

We believe Enron's fundamentals are still strong despite the weak economy. We view Enron as one of the best companies in the economy, let alone among the companies in our energy convergence space. We are confident in the company's ability to grow earnings more than 20% annually for the next five years, despite its already large base.
www.actwin.com/kalostr...
]]> Thu, 29 May 2008 07:48:49 -0400
GOLDMAN SACHS, October 9, 2001 -

Recommended List Large-Cap Growth
Price:US$33.45 Target price: US$48 S&P 500: 1051
United States Enron Corp. (ENE)

Gas & Power Convergence
Still the best of the best. With perceptions far below reality, we see major catalysts in third-quarter results and increased
disclosure in coming months. We strongly reiterate our Recommended List rating and our conviction in high and sustained growth prospects, even though we have cut 2002 EPS to $2.15 and our price target to $48. We expect Enron shares to recover dramatically in the coming months. We view the current period as an extremely rare opportunity to purchase the shares of a company that remains extremely well positioned to grow at a substantial rate and earn strong returns in the still-very-young and evolving energy convergence space.

We strongly reiterate our Recommended List rating on Enron stock. We spoke recently with top management including the CEO, CFO, chief accounting officer, and the head of wholesale services.

We challenged top management on the wide range of investor concerns that have weighed heavily on the shares and believe that the majority of market speculation is groundless, and that which has some truth to it, to be exaggerated.

Misconceptions abound and perceptions are far below reality, in our view We believe that investors have virtually given up on Enron (down 60% year to date) and its prospects based on the long list of extremely negative stories about the company and its financial condition.

The company's limited transparency on its sources of earnings, its cash flow, and financials in general has hurt investor perceptions as management has declined to be more specific in refuting outrageous claims that have assumed a life of their own.

We believe Enron's fundamentals are still strong despite the weak economy. We view Enron as one of the best companies in the economy, let alone among the companies in our energy convergence space. We are confident in the company's ability to grow earnings more than 20% annually for the next five years, despite its already large base.
www.actwin.com/kalostr...
]]> http://seekingalpha.com/article/78435-research-in-motion-price-target-raised-substantially-by-gmp-research?source=feed#comment-172246 172246


The latest BS "Target Price" was $190/sh for a valuation of $107bn.



A company with $6bn in sales and a profit of $1.3bn, pe of over 60 and now valued at over 12 times annual sales. With growth slowing-100% growth is over.



At the current price of $130/sh, RIM is valued at $240 for every man, woman and child in the USA,

RIMM market cap is $73 billion= $ 73,000 Million.



At a phony Target Price of $190/sh, RIM would be valued at $107 bn, Divided by 304ml it would be valued at $351 for every man, women and child in the USA.



Can longs UNDERSTAND THAT VALUATION BUBBLE????



Population at-

US population is 304,128,000

www.census.gov/main/ww...







]]> Thu, 22 May 2008 20:10:24 -0400


The latest BS "Target Price" was $190/sh for a valuation of $107bn.



A company with $6bn in sales and a profit of $1.3bn, pe of over 60 and now valued at over 12 times annual sales. With growth slowing-100% growth is over.



At the current price of $130/sh, RIM is valued at $240 for every man, woman and child in the USA,

RIMM market cap is $73 billion= $ 73,000 Million.



At a phony Target Price of $190/sh, RIM would be valued at $107 bn, Divided by 304ml it would be valued at $351 for every man, women and child in the USA.



Can longs UNDERSTAND THAT VALUATION BUBBLE????



Population at-

US population is 304,128,000

www.census.gov/main/ww...







]]> http://seekingalpha.com/article/77818-maverick-capital-portfolio-holdings?source=feed#comment-170778 170778 valued at 13 times annual sales- sales $6bn, growth slowing, no more 100% increases.

a p/e of over 60 , a bubble.]]> Tue, 20 May 2008 20:17:53 -0400 valued at 13 times annual sales- sales $6bn, growth slowing, no more 100% increases.

a p/e of over 60 , a bubble.]]> http://seekingalpha.com/article/77349-research-in-motion-s-plans-to-launch-blackberry-thunder-are-legit?source=feed#comment-168254 168254
The stock has a bubble valuation, but it seems the Greater Fools keep buying (but for how long?)]]> Thu, 15 May 2008 14:54:34 -0400
The stock has a bubble valuation, but it seems the Greater Fools keep buying (but for how long?)]]> http://seekingalpha.com/article/77027-on-rim-s-new-high-a-technical-view?source=feed#comment-167345 167345
In 2000 Cramer had this advice on how to make money in stocks- his advice ignored valuation and normal fundamental, Momo investing

See article, (all of his stocks crashed)

Cramer said-
"To answer that question, you have to throw out all of the matrices and formulas and texts that existed before the Web. You have to throw them away because they can't make money for you anymore, and that is all that matters. We don't use price-to-earnings multiples anymore at Cramer Berkowitz. If we talk about price-to-book, we have already gone astray. If we use any of what Graham and Dodd teach us, we wouldn't have a dime under management."

All of his picks back then crashed, even his 4 Horsemen of 2000.

article-

The Winners of the New World
By James J. Cramer

2/29/00 9:42 AM ET


You want winners? You want me to put my Cramer Berkowitz hedge fund hat on and just discuss
what my fund is buying today to try to make money tomorrow and the next day and the next? You want my top 10 stocks for who is going to make it in the New World? You know what? I am going to give them to you. Right here. Right now.
OK. Here goes. Write them down -- no handouts here!: 724 Solutions (SVNX:Nasdaq - news), Ariba (ARBA), Digital Island (ISLD), Exodus (EXDS), InfoSpace.com (INSP), Inktomi (INKT), Mercury Interactive (MERQ:), Sonera (SNRA), VeriSign (VRSN) and Veritas Software (VRTS).
We are buying some of every one of these this morning....



www.thestreet.com/fund...
]]> Wed, 14 May 2008 09:13:21 -0400
In 2000 Cramer had this advice on how to make money in stocks- his advice ignored valuation and normal fundamental, Momo investing

See article, (all of his stocks crashed)

Cramer said-
"To answer that question, you have to throw out all of the matrices and formulas and texts that existed before the Web. You have to throw them away because they can't make money for you anymore, and that is all that matters. We don't use price-to-earnings multiples anymore at Cramer Berkowitz. If we talk about price-to-book, we have already gone astray. If we use any of what Graham and Dodd teach us, we wouldn't have a dime under management."

All of his picks back then crashed, even his 4 Horsemen of 2000.

article-

The Winners of the New World
By James J. Cramer

2/29/00 9:42 AM ET


You want winners? You want me to put my Cramer Berkowitz hedge fund hat on and just discuss
what my fund is buying today to try to make money tomorrow and the next day and the next? You want my top 10 stocks for who is going to make it in the New World? You know what? I am going to give them to you. Right here. Right now.
OK. Here goes. Write them down -- no handouts here!: 724 Solutions (SVNX:Nasdaq - news), Ariba (ARBA), Digital Island (ISLD), Exodus (EXDS), InfoSpace.com (INSP), Inktomi (INKT), Mercury Interactive (MERQ:), Sonera (SNRA), VeriSign (VRSN) and Veritas Software (VRTS).
We are buying some of every one of these this morning....



www.thestreet.com/fund...
]]> http://seekingalpha.com/article/76692-research-in-motion-s-2009-guidance-tracking-ahead-of-consensus?source=feed#comment-165849 165849
Is this the same con as 2000? Cisco to a trillion $ valuation, it crashed 80% instead.

part of article-
Friday, March 17, 2000
Firm's market cap climbing to $1 trillion
Silicon Valley / San Jose Business Journal - by Dennis Taylor
One trillion dollars.

That's how much at least one analyst believes Cisco Systems Inc. will be worth in a few years--and you'd be hard pressed to find anyone to disagree.

The San Jose-based networking behemoth's stock closed March 14 at $131.75 a share, slightly down from its March 10 one-year high of $141.88 (The entire Nasdaq slid 4 percent on March 14.)

Thirty-seven investment banks recommend either a "buy" or a "strong buy." None recommend a "sell" or even a "hold." ...

George Kelly, an analyst with Morgan Stanley Dean Witter in New York who took Cisco public a decade ago, is one of the Cisco bulls. Cisco's stock is trading at roughly 120 times Mr. Kelly's earnings' estimate of $1.13 per share....

"A low P/E usually signals investors are uncomfortable," Mr. Kelly said.

As a reference, in 2000 Cisco's multiple of 120 compares to Microsoft Corp.'s multiple of 55 and Intel Corp.'s multiple of 42. Yet their values are below Cisco.

"One of the reasons investors value Cisco so highly right now is that, unlike Microsoft, Cisco doesn't have the uncertainty of a Justice Department settlement--it's a much cleaner situation," Mr. Kelly said. "Second, Cisco has had a tremendous track record of continuous upside surprises. And Cisco is viewed as opening several new markets, the biggest of which is optical, which is expected to be an explosive market."

Perfect returns
Paul Weinstein, an analyst with Credit Suisse First Boston, believes a $1 trillion market capitalization (stock price multiplied by shares outstanding) is within reach in a few years. He said Cisco's stock has increased 1,000 times, a perfect 100 percent annual return since it launched its IPO in 1990.

"We humbly submit that over the next two to three years, Cisco could be the first trillion dollar market cap company--and don't think they wouldn't love it," Mr. Weinstein wrote in his "strong buy" recommendation.

As of March 14, Microsoft's market cap stood about $510 billion, compared with Cisco's $465 billion, which is threefold the annual revenue of the state of California. ...



An opposing view
There are market watchers that are dubious, however, about the high valuation assigned to a large-cap company like Cisco.

Jeremy Siegel, a finance professor at the Wharton School, wrote this week in The Wall Street Journal that the high valuation assigned to large-cap technology stocks--Cisco is at the top of his list--are unsustainable.

"History has shown that whenever companies, no matter how great, get priced above 50 to 60 times earnings, buyer beware," Mr. Siegel wrote.....



..."If you had picked a price point to sell [high] at anytime in the past 10 years, you would have been wrong," he said. "They have such an impressive track record of growing ... that the financial community isn't thinking in terms of a multiple of what they're earning this year, but what they will be earning three or four years down the line." ...

full article@


sanjose.bizjournals.co...
]]> Sun, 11 May 2008 13:34:34 -0400
Is this the same con as 2000? Cisco to a trillion $ valuation, it crashed 80% instead.

part of article-
Friday, March 17, 2000
Firm's market cap climbing to $1 trillion
Silicon Valley / San Jose Business Journal - by Dennis Taylor
One trillion dollars.

That's how much at least one analyst believes Cisco Systems Inc. will be worth in a few years--and you'd be hard pressed to find anyone to disagree.

The San Jose-based networking behemoth's stock closed March 14 at $131.75 a share, slightly down from its March 10 one-year high of $141.88 (The entire Nasdaq slid 4 percent on March 14.)

Thirty-seven investment banks recommend either a "buy" or a "strong buy." None recommend a "sell" or even a "hold." ...

George Kelly, an analyst with Morgan Stanley Dean Witter in New York who took Cisco public a decade ago, is one of the Cisco bulls. Cisco's stock is trading at roughly 120 times Mr. Kelly's earnings' estimate of $1.13 per share....

"A low P/E usually signals investors are uncomfortable," Mr. Kelly said.

As a reference, in 2000 Cisco's multiple of 120 compares to Microsoft Corp.'s multiple of 55 and Intel Corp.'s multiple of 42. Yet their values are below Cisco.

"One of the reasons investors value Cisco so highly right now is that, unlike Microsoft, Cisco doesn't have the uncertainty of a Justice Department settlement--it's a much cleaner situation," Mr. Kelly said. "Second, Cisco has had a tremendous track record of continuous upside surprises. And Cisco is viewed as opening several new markets, the biggest of which is optical, which is expected to be an explosive market."

Perfect returns
Paul Weinstein, an analyst with Credit Suisse First Boston, believes a $1 trillion market capitalization (stock price multiplied by shares outstanding) is within reach in a few years. He said Cisco's stock has increased 1,000 times, a perfect 100 percent annual return since it launched its IPO in 1990.

"We humbly submit that over the next two to three years, Cisco could be the first trillion dollar market cap company--and don't think they wouldn't love it," Mr. Weinstein wrote in his "strong buy" recommendation.

As of March 14, Microsoft's market cap stood about $510 billion, compared with Cisco's $465 billion, which is threefold the annual revenue of the state of California. ...



An opposing view
There are market watchers that are dubious, however, about the high valuation assigned to a large-cap company like Cisco.

Jeremy Siegel, a finance professor at the Wharton School, wrote this week in The Wall Street Journal that the high valuation assigned to large-cap technology stocks--Cisco is at the top of his list--are unsustainable.

"History has shown that whenever companies, no matter how great, get priced above 50 to 60 times earnings, buyer beware," Mr. Siegel wrote.....



..."If you had picked a price point to sell [high] at anytime in the past 10 years, you would have been wrong," he said. "They have such an impressive track record of growing ... that the financial community isn't thinking in terms of a multiple of what they're earning this year, but what they will be earning three or four years down the line." ...

full article@


sanjose.bizjournals.co...
]]> http://seekingalpha.com/article/75805-rbc-analyst-rim-can-withstand-smartphone-competition?source=feed#comment-162483 162483
$6bn in sales, valuation of over $70bn, like 2000 is back]]> Tue, 06 May 2008 08:17:17 -0400
$6bn in sales, valuation of over $70bn, like 2000 is back]]> http://seekingalpha.com/article/74068-amazon-toying-with-vertical-integration?source=feed#comment-157076 157076 RE: AMZN's Free Cash Flow -they have Very Little
(posted on a message bd)
people have used the wrong formula to compute FCF for AMZN. There are various methods to compute the number depending on the type of enterprise you are dealing with.

If you use the formula from Investopedia Advisor, the link YOU posted earlier in this thread, you would see that there is no increase in FCF
www.investopedia.com/t...
Formula from your link-

Net income
+ Depreciation/Amortizat...
- Change in Working Capital
- Capital Expenditure
----------------------...
= Free Cash Flow
In some cases FCF can be calculated by taking operating cash flow and subtracting capital expenditures, (not meaningful in AMZN’s case, as it ignores cash on hand @12/31/07 that would be used to pay bills- it is not Free Cash, if accounts payables did not increase by $1.2 bn there would have been only a small increase in Cash Flow.
See Balance sheet- finance.yahoo.com/q/bs...
HOW CAN YOU ADD THIS INCREASE OF A/P TO FREE CASH FLOW?? IT’S NOT FREE CASH, IT HAS TO PAID OUT IN THE NEXT QUARTER?????
“Free cash flow, strictly speaking, is the amount of money left over from the operations of a company that is available for distribution owners of the capital employed in the company (stockholders)”.

FCF computation for AMZN using 12/31/07 from-
finance.yahoo.com/q/cf...
(ignoring other smaller input items)
Net Income...................
+Amortization/Deprecia...
-Change in Workng Capital........-832 (a/p, a/r etc)
–Capital Expenditure..............
________________
= Free Cash Flow.....................
There may be other ways to compute FCF, but the above is more accurate (other minor inputs can be added) as the definition of FCF


Article-
Free Cash Flow: Free, But Not Always Easy
by Ben McClure, Contributor - Investopedia Advisor

The best things in life are free, and the same holds true for cash flow. Smart investors love companies that produce plenty of free cash flow (FCF). It signals a company's ability to pay debt, pay dividends, buy back stock and facilitate the growth of business - all important undertakings from an investor's perspective. However, while free cash flow is a great gauge of corporate health, it does have its limits and is not immune to accounting trickery....


...To do it another way, grab the income statement and balance sheet. Start with net income and add back charges for depreciation and amortization. Make an additional adjustment for changes in working capital, which is done by subtracting current liabilities from current assets...


www.investopedia.com/t...]]> Sat, 26 Apr 2008 10:00:26 -0400 RE: AMZN's Free Cash Flow -they have Very Little
(posted on a message bd)
people have used the wrong formula to compute FCF for AMZN. There are various methods to compute the number depending on the type of enterprise you are dealing with.

If you use the formula from Investopedia Advisor, the link YOU posted earlier in this thread, you would see that there is no increase in FCF
www.investopedia.com/t...
Formula from your link-

Net income
+ Depreciation/Amortizat...
- Change in Working Capital
- Capital Expenditure
----------------------...
= Free Cash Flow
In some cases FCF can be calculated by taking operating cash flow and subtracting capital expenditures, (not meaningful in AMZN’s case, as it ignores cash on hand @12/31/07 that would be used to pay bills- it is not Free Cash, if accounts payables did not increase by $1.2 bn there would have been only a small increase in Cash Flow.
See Balance sheet- finance.yahoo.com/q/bs...
HOW CAN YOU ADD THIS INCREASE OF A/P TO FREE CASH FLOW?? IT’S NOT FREE CASH, IT HAS TO PAID OUT IN THE NEXT QUARTER?????
“Free cash flow, strictly speaking, is the amount of money left over from the operations of a company that is available for distribution owners of the capital employed in the company (stockholders)”.

FCF computation for AMZN using 12/31/07 from-
finance.yahoo.com/q/cf...
(ignoring other smaller input items)
Net Income...................
+Amortization/Deprecia...
-Change in Workng Capital........-832 (a/p, a/r etc)
–Capital Expenditure..............
________________
= Free Cash Flow.....................
There may be other ways to compute FCF, but the above is more accurate (other minor inputs can be added) as the definition of FCF


Article-
Free Cash Flow: Free, But Not Always Easy
by Ben McClure, Contributor - Investopedia Advisor

The best things in life are free, and the same holds true for cash flow. Smart investors love companies that produce plenty of free cash flow (FCF). It signals a company's ability to pay debt, pay dividends, buy back stock and facilitate the growth of business - all important undertakings from an investor's perspective. However, while free cash flow is a great gauge of corporate health, it does have its limits and is not immune to accounting trickery....


...To do it another way, grab the income statement and balance sheet. Start with net income and add back charges for depreciation and amortization. Make an additional adjustment for changes in working capital, which is done by subtracting current liabilities from current assets...


www.investopedia.com/t...]]> http://seekingalpha.com/article/72972-syntax-brillian-and-other-tv-sales-hurting-in-weak-u-s-economy?source=feed#comment-153615 153615 Sun, 20 Apr 2008 08:01:10 -0400 http://seekingalpha.com/article/72685-was-peter-lynch-wrong-crocs-and-other-trendy-companies?source=feed#comment-153608 153608
]]> Sun, 20 Apr 2008 07:33:11 -0400
]]> http://seekingalpha.com/article/71190-is-there-a-mobile-phone-recession?source=feed#comment-147472 147472 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.
]]> Wed, 09 Apr 2008 07:08:39 -0400 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.
]]> http://seekingalpha.com/article/70973-rimm-s-blackberry-pure-domination?source=feed#comment-136386 136386 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.

]]> Fri, 04 Apr 2008 06:24:27 -0400 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.

]]> http://seekingalpha.com/article/71155-research-in-motion-shares-up-on-outstanding-4q-results?source=feed#comment-136385 136385 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.

]]> Fri, 04 Apr 2008 06:19:43 -0400 RIM sales growth is decreasing, this quarter's increase was only $210 million, 12.5% as compared to $300 ml, 22% for the Dec Q, $278ml or 25% in the Sept quarters and $950ml or 100% for the year ago Qtr.



Quarterly sales Increases have decreased, is it because of the Recession or Competition??



100% GROWTH is Long Gone, how can RIMs sales double from $6bn to 12bn, when the quarterly sales increase was only $210 ml? They would need a quarterly increase of $1.5 bn for sales to double from here. The $210ml increase is a long way off.



Total Sales for the 12 months equaled $6bn, and RIM is currently valued at $70bn, 11+ times annual sales-Priced to more than Perfection.



RIMM HIGHLY OVERVALUED_


Who would buy RIM, with sales of $6bn for $70 to 100+bn??? For earnings of $1bn? A Potential buyer could invest that $70-100bn at 6% and earn almost as much as RIM has in sales and more than RIM earned it its lifetime.


Sales-Qtr, Increases, % of Increase

QTR Ended.--SALES/ml.. INCR/Q...% INCR/Q

Mar 3, 08...$1,880........210...
Dec 3, 07...$1,670........300...
Sept 3, 07..$1,370........278m...
June 3,07.....1,082.....151...
Mar 3, 07........930........ 95.3....11.4%
Dec 2, 06........835.......17... %
Sept 2, 06.......658....... 45.4......7.4%
Jun 3, 06.........613....... 51.8......9.2%
Mar 4, 06........561......

HUGE INCR IN MKT VALUATION, SMALL INCR IN SALES .
Sales for 12 mos ending Mar 3, 2008..........$6.0bn
Sales for 12 mos ending Dec 3, 2007.........$5.1bn



Sales Incr for the 12 Mos Ended Mar 3, 2008........$900ml



Val'n Incr'd over $12 billion in past few weeks.

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