From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1337 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Thursday, May 3 2001 Volume 02 : Number 1337 In this issue: [CANSLIM] TRR Re: [CANSLIM] Ouch, that hurts Re: [CANSLIM] SERO Re: [CANSLIM] Thoughts on RLRN? RE: [CANSLIM] SERO Re: [CANSLIM] TRR Re: [CANSLIM] Ouch, that hurts Re: [CANSLIM] SERO Re: [CANSLIM] SERO Re: [CANSLIM] CHIC Re: [CANSLIM] SERO Re: [CANSLIM] IBD Investors Corner today. Re: [CANSLIM] SERO Re: [CANSLIM] CHIC Re: [CANSLIM] SERO ---------------------------------------------------------------------- Date: Thu, 03 May 2001 15:03:38 -0600 From: DougC Subject: [CANSLIM] TRR TRR has tried yesterday and today to break past 52 week high of 33 bucks. Today vol was 4x ADV but still couldnt do it. Looks like an excellent CANSLIM stock. The C&H, if you agree to call it that, has'nt been the smoothest. Tomorrow should be interesting. I bought in early couple weeks ago and weathered a brutal shakeout. Now I'd like to be rewarded with a breakout. Maybe I should make a sacrifice and sell half my shares?? - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 18:38:06 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Ouch, that hurts Interesting, DGO has the group Bldg-Resident/Commercial still ranked at the top with a GRS of 99. I don't understand why WON doesn't just do away with the A to E ratings and use GRS instead. At least then you can see movement up and down without having to wait for the letter to change as it moves from one 20% group to the next. In this case, tho, GRS didn't show the decline I was expecting. Hummm! Tom Worley stkguru@netside.net - ----- Original Message ----- From: Eric Daviscourt To: Sent: Thursday, May 03, 2001 12:04 PM Subject: Re: [CANSLIM] Ouch, that hurts Patrick, I have found that the IBD Industry rankings tend to lag. I use IRL with QP2 data and find my rankings using the Wilder RSI with 14 week. Doing so, the residential builders as of yesterday ranked 45th with a RS of 78. The week of 4/27 they ranked 25th with a RS of 88 and the prior week of 4/20 they ranked 62nd with a RS of 69. I am new to using the IRL but found it after noticing that the IBD Industry rankings tended to lag and wanting to find something more accurate for my personal needs. If you desire more information on this product you might want to go to www.ianforum.com. Eric - ----- Original Message ----- From: "Patrick Wahl" To: Sent: Wednesday, May 02, 2001 10:19 PM Subject: Re: [CANSLIM] Ouch, that hurts > > > On 2 May 01, at 17:28, Kent Norman wrote: > > > Earl > > > > Looking back, we can see that home builders had been > > leading for quite a while. It was only a matter of > > time till they ran out of steam. Perhaps we should > > start looking for an age limit? > > > > Does anyone have information on how long typical (if > > there is such a thing) leaders keep the lead? > > Someone on CNBC pointed out the home builders are a cyclical > type group, and you want to buy them when they look awful, and > get out when earnings are very good, which is what is going on > now. This may explain why they are weak. > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 19:05:41 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] SERO Hi Jans, I am not an accountant, but maybe we have one in the group who can jump in here. My understanding of cash flow is that it is EBITDA (Earnings Before Income Tax Depreciation Amortization). This sometimes is also called gross profit, but is not the same. My understanding of EBITDA is that it is the gross revenues, minus virtually all expenses other than the three mentioned above. So cash flow measured this way can be affected by a lot of things, including significant changes in R&D expenses, other major capital expenses, a lot of new hiring, layoffs with associated severance packages, launching a new product line with heavy marketing expenses, etc. While dividends are not deductible from the corp taxes, I do believe they are deducted ahead of EBITDA, thus they serve to reduce taxable income. That is why they are taxable income to the recipient. At least that's my logic, altho I seem to recall someone trying to convince me they are taxed at both the corp and the recipient level. The only way I know to understand changes in cash flow is to compare the 10Qs and the 10K, and see where changes are occurring out of proportion to the change in gross revenue. Tom Worley stkguru@netside.net - ----- Original Message ----- From: To: Sent: Thursday, May 03, 2001 2:27 PM Subject: Re: [CANSLIM] SERO Tom: One reason, I believe, cash-flow will drop is when there is an increase in dividends. Companies must pay taxes on their earnings, and dividends cannot be deducted from the taxes (ie. it is a discretionary payment that the company must pay out of earnings). Can you think of any other reason why earnings increase, but cash-flow comes in as less than earnings? The only other reason I can think of is because the company is paying its debts (or what if foresees as debts) ahead of time. jans jans In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, stkguru@netside.net writes: << ...Also, cash flow is slightly lower than last year's earnings.... >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 19:10:51 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Thoughts on RLRN? I took a look at the short interest report at DGO tonight, as of Apr 15, it totaled 1,091,863 shares short. That's a lot on this size float. Next report will be as of May 15, and likely reported around May 22. Will be interesting to see if it changed. Tom Worley stkguru@netside.net - ----- Original Message ----- From: To: Sent: Thursday, May 03, 2001 2:43 PM Subject: Re: [CANSLIM] Thoughts on RLRN? Tom: Nice observation on the short squeeze; I hadn't even noticed that shorts made up approx. 10% of the stocks float. When I read the post I looked at RLRN in Tuesday's sponsorship ratings. Last Tues. it was rated an "E". In a message dated 5/2/2001 11:15:22 PM Eastern Daylight Time, stkguru@netside.net writes: << Personally, I think today was a short squeeze. With a short position of over 1 million shares, and a float of 9.9 million shares, that would explain today's 6+X ADV and price spike. Stock has been up now 7 straight days, so be prepared to give a little back, but hopefully not below the 36.5 to 37 level. I can't disagree with getting in a little early. The base that was forming was tight. I have the same problem of waiting for the b/o to buy, due time limitations at work. But the CS elements look good, except for the cash flow. Tom Worley >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 16:22:34 -0700 From: "Shen, Eric" Subject: RE: [CANSLIM] SERO Dividends are taxed twice - both at the corporate level and at the individual level. It's commonly referred to as "double taxation" http://www.ncpa.org/pi/taxes/double.html http://www.yk.psu.edu/~dxl31/econ4/lecture2.html (look under Business Firms) - -----Original Message----- From: Tom Worley [mailto:stkguru@netside.net] Sent: Thursday, May 03, 2001 4:06 PM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] SERO Hi Jans, I am not an accountant, but maybe we have one in the group who can jump in here. My understanding of cash flow is that it is EBITDA (Earnings Before Income Tax Depreciation Amortization). This sometimes is also called gross profit, but is not the same. My understanding of EBITDA is that it is the gross revenues, minus virtually all expenses other than the three mentioned above. So cash flow measured this way can be affected by a lot of things, including significant changes in R&D expenses, other major capital expenses, a lot of new hiring, layoffs with associated severance packages, launching a new product line with heavy marketing expenses, etc. While dividends are not deductible from the corp taxes, I do believe they are deducted ahead of EBITDA, thus they serve to reduce taxable income. That is why they are taxable income to the recipient. At least that's my logic, altho I seem to recall someone trying to convince me they are taxed at both the corp and the recipient level. The only way I know to understand changes in cash flow is to compare the 10Qs and the 10K, and see where changes are occurring out of proportion to the change in gross revenue. Tom Worley stkguru@netside.net - ----- Original Message ----- From: To: Sent: Thursday, May 03, 2001 2:27 PM Subject: Re: [CANSLIM] SERO Tom: One reason, I believe, cash-flow will drop is when there is an increase in dividends. Companies must pay taxes on their earnings, and dividends cannot be deducted from the taxes (ie. it is a discretionary payment that the company must pay out of earnings). Can you think of any other reason why earnings increase, but cash-flow comes in as less than earnings? The only other reason I can think of is because the company is paying its debts (or what if foresees as debts) ahead of time. jans jans In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, stkguru@netside.net writes: << ...Also, cash flow is slightly lower than last year's earnings.... >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 19:22:32 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] TRR Doug, I agree, a nice looking CS stock. Eight sequential qtrs of not just growth, but consistent growth, in both earnings and revenues. What you see as a cup, I see as a "V" bottom, which are more prone to failure, as you found out. What disturbs me about the V bottom is that the "capitulation" selling day was only 3X ADV. But then, the volume on the right side was below ADV until it was back even with the left side. You had a heavy day of selling on 4/17, but the price remained steady. May have been one institution crossing a block to another. But on 4/19, you again had heavy selling, this time with a 10% price drop. This would concern me. Today's heavy volume without price gain suggests to me institutional activity again. Funds are reported holding only 7%, but I haven't checked the venture capitalists. Bottom line, I would probably keep a tight trailing stop, but not sell any for now. Tom Worley stkguru@netside.net - ----- Original Message ----- From: DougC To: Sent: Thursday, May 03, 2001 5:03 PM Subject: [CANSLIM] TRR TRR has tried yesterday and today to break past 52 week high of 33 bucks. Today vol was 4x ADV but still couldnt do it. Looks like an excellent CANSLIM stock. The C&H, if you agree to call it that, has'nt been the smoothest. Tomorrow should be interesting. I bought in early couple weeks ago and weathered a brutal shakeout. Now I'd like to be rewarded with a breakout. Maybe I should make a sacrifice and sell half my shares?? - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 19:38:58 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Ouch, that hurts Tim, After reading this article on why the stock tanked on incorrect info, do you step back in? From the chart, it looks to me like a lazy LLUR, but the spike down clearly broke the pattern. Does this count when it is broken on bad information, then doesn't immediately recover the lost ground when the error is corrected? How do you call this one now, with the new information? Tom Worley stkguru@netside.net - ----- Original Message ----- From: can slim To: Sent: Thursday, May 03, 2001 5:15 PM Subject: Re: [CANSLIM] Ouch, that hurts http://messages.yahoo.com/bbs?.mm=FN&action=m&board=7079926&tid=h ov&sid=7079926&mid=739 >From: "Tim Fisher" >Reply-To: canslim@lists.xmission.com >To: canslim@lists.xmission.com >Subject: Re: [CANSLIM] Ouch, that hurts >Date: 2 May 2001 08:34:28 -0700 > >HOV dumped me this AM. At least I had a profit! Looks like a complete >meltdown. > > At 08:33 PM 5/1/2001 -0600, you wrote: >>First, I have had a couple of people respond to my Clearstation "sell" >>notifications here. For those who didn't know, my original message wasn't >>posted here, and it basically said I was dumped out of several stocks. >> >>Now, back to our regularly scheduled program..... >> >> >>Ouch. I went into this week with 3 Home Builders, 2 other stocks, and >>added my last position in PPDI yesterday morning. At that point, 4 of 5 >>stocks were up nicely, and I was thinking maybe this rally would be >>different. Here we are about 1 1/2 trading day later, and I've been >>stopped out of 4 positions, and lost another 4% of my funds (more or >>less). >> I got burned 2-fold. >> >>I had 3 Home Builders, and all 3 went down strongly on Monday and Tuesday. >>One, MDC, was up for a while today, but then plummeted. In the end, I >>took >>losses on all three as they hit my stops. Overall, I'm very surprised to >>see an industry group that is ranked #1, and has 5-10 potential CANSLIM >>breakouts in about a week fail so strongly. Is this something that >>happens >>to the top group very often? Have others witnessed this kind of meltdown >>very often? >> >>My other position was PPDI. It had moved up nicely late last week, and >>then seemed to be resting a bit just above the pivot. It looked ready to >>move higher, especially with its group moving up rapidly, so I gave it a >>shot. It dropped rapidly today and I sold out as soon as I saw the drop >>(about 10%). After looking closer, I found that the stock had moved up on >>the earnings annoucement last week, but there was a VERY UNUSUAL dividend >>announced, 1 share/share owned. In other words, everyone who owned the >>stock as of Thursday (I think) gets an extra share in a few weeks. At >>that >>point, anyone who wanted to could sell all their holdings at a new high, >>and still have the same amount of stock in 3 weeks. Given this, there >>seems to be a lot of downward pressure on the stock. I mean, the value of >>last week's holders doubled instantly. I expect HUGE downward pressure on >>the stock over the next few weeks, and today was an example. This is >>clearly my fault for not reading the news before buying, but has anyone >>seen this kind of dividend before? Is it likely that the stock price >>would >>hold up to a "double"? This seems really unusual to me. >> >>- >>-To subscribe/unsubscribe, email "majordomo@xmission.com" >>-In the email body, write "subscribe canslim" or >>-"unsubscribe canslim". Do not use quotes in your email. > >Tim Fisher >Ore-ROCK-On Rockhounding Web Site >Pacific Fishery Biologists Information >mailto:tim@OreRockOn.com >WWW http://OreRockOn.com > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. _________________________________________________________________ Get your FREE download of MSN Explorer at http://explorer.msn.com - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 19:36:13 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] SERO Thanks, Eric, never having done corp taxes I knew I was fuzzy on the issue. Still, doesn't seem fair for Uncle Sam to take a slice of the pie twice. Maybe Bush can be petitioned for tax relief for one of us, preferably the corps. Then they would have more profits to pay out, or better EPS, and smaller companies would have an added incentive to start a dividend program when earnings are good and expected to get better (one of my more successful signals to plunge into a smaller company is when they initiate a dividend). Tom Worley stkguru@netside.net - ----- Original Message ----- From: Shen, Eric To: Sent: Thursday, May 03, 2001 7:22 PM Subject: RE: [CANSLIM] SERO Dividends are taxed twice - both at the corporate level and at the individual level. It's commonly referred to as "double taxation" http://www.ncpa.org/pi/taxes/double.html http://www.yk.psu.edu/~dxl31/econ4/lecture2.html (look under Business Firms) - -----Original Message----- From: Tom Worley [mailto:stkguru@netside.net] Sent: Thursday, May 03, 2001 4:06 PM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] SERO Hi Jans, I am not an accountant, but maybe we have one in the group who can jump in here. My understanding of cash flow is that it is EBITDA (Earnings Before Income Tax Depreciation Amortization). This sometimes is also called gross profit, but is not the same. My understanding of EBITDA is that it is the gross revenues, minus virtually all expenses other than the three mentioned above. So cash flow measured this way can be affected by a lot of things, including significant changes in R&D expenses, other major capital expenses, a lot of new hiring, layoffs with associated severance packages, launching a new product line with heavy marketing expenses, etc. While dividends are not deductible from the corp taxes, I do believe they are deducted ahead of EBITDA, thus they serve to reduce taxable income. That is why they are taxable income to the recipient. At least that's my logic, altho I seem to recall someone trying to convince me they are taxed at both the corp and the recipient level. The only way I know to understand changes in cash flow is to compare the 10Qs and the 10K, and see where changes are occurring out of proportion to the change in gross revenue. Tom Worley stkguru@netside.net - ----- Original Message ----- From: To: Sent: Thursday, May 03, 2001 2:27 PM Subject: Re: [CANSLIM] SERO Tom: One reason, I believe, cash-flow will drop is when there is an increase in dividends. Companies must pay taxes on their earnings, and dividends cannot be deducted from the taxes (ie. it is a discretionary payment that the company must pay out of earnings). Can you think of any other reason why earnings increase, but cash-flow comes in as less than earnings? The only other reason I can think of is because the company is paying its debts (or what if foresees as debts) ahead of time. jans jans In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, stkguru@netside.net writes: << ...Also, cash flow is slightly lower than last year's earnings.... >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 03 May 2001 18:11:16 -0600 From: esetser Subject: Re: [CANSLIM] SERO I would say there are 3 possible explanations. Accounting, accounting, and accounting. (I pause to remember the "Dilbert" where the main character was required to check his "ethics" before entering the accounting department!) There are numerous ways the company accountants can impact the earnings numbers for a quarter, both up and down. It isn't unusual for a company with a particularly strong quarter to "delay" recognizing some of that revenue to the next quarter. This gives the impression of 2 strong quarters, that may, in fact, be totally wrong. Many investors feel that cash flow is a much harder number to influence, and therefore is more indicative of actual performance for a quarter than earnings. Companies that consistently show earnings well above cash flow are questionable in my opinion. At 02:27 PM 5/3/01 EDT, you wrote: >Tom: > > One reason, I believe, cash-flow will drop is when there is an increase >in dividends. Companies must pay taxes on their earnings, and dividends >cannot be deducted from the taxes (ie. it is a discretionary payment that the >company must pay out of earnings). > > Can you think of any other reason why earnings increase, but cash-flow >comes in as less than earnings? The only other reason I can think of is >because the company is paying its debts (or what if foresees as debts) ahead >of time. > >jans > > > >jans > > >In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, >stkguru@netside.net writes: > ><< ...Also, cash > flow is slightly lower than last year's earnings.... >> > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 03 May 2001 18:14:00 -0600 From: esetser Subject: Re: [CANSLIM] CHIC After 5 consecutive up days starting with a strong move up, I feel today was a justified break to take a rest and move with the market. The stock traded quite a bit lower during the day, but finished mid-range. I'm not concerned about today's action, but I would be if the stock moved 2 or 3% lower over the next few days. For now, I'm okay to sit on it and wait for better days. At 02:27 PM 5/3/01 -0400, you wrote: > >Hi, > >what is group's opinion on CHIC? I do not like today's behaviour - it >seems to me it is ready to go down. > >Anna > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 20:09:25 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] SERO One correction here, I knew my translation of EBITDA didn't sound right, but didn't spot it till it was sent. The "I" in EBITDA is for Interest, not Income (tax). So it is Earnings Before Interest Taxes Depreciation Amortization. All other corporate expenses would have already reduced the gross revenues, other than these four debit items. I told you I was not an accountant, in fact I hate the subject! When my wife took it for two years in college, she gave up on me helping her, because I always had to do it standing on my head and reading it in a mirror. Tom Worley stkguru@netside.net - ----- Original Message ----- From: Tom Worley To: Sent: Thursday, May 03, 2001 7:36 PM Subject: Re: [CANSLIM] SERO Thanks, Eric, never having done corp taxes I knew I was fuzzy on the issue. Still, doesn't seem fair for Uncle Sam to take a slice of the pie twice. Maybe Bush can be petitioned for tax relief for one of us, preferably the corps. Then they would have more profits to pay out, or better EPS, and smaller companies would have an added incentive to start a dividend program when earnings are good and expected to get better (one of my more successful signals to plunge into a smaller company is when they initiate a dividend). Tom Worley stkguru@netside.net - ----- Original Message ----- From: Shen, Eric To: Sent: Thursday, May 03, 2001 7:22 PM Subject: RE: [CANSLIM] SERO Dividends are taxed twice - both at the corporate level and at the individual level. It's commonly referred to as "double taxation" http://www.ncpa.org/pi/taxes/double.html http://www.yk.psu.edu/~dxl31/econ4/lecture2.html (look under Business Firms) - -----Original Message----- From: Tom Worley [mailto:stkguru@netside.net] Sent: Thursday, May 03, 2001 4:06 PM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] SERO Hi Jans, I am not an accountant, but maybe we have one in the group who can jump in here. My understanding of cash flow is that it is EBITDA (Earnings Before Income Tax Depreciation Amortization). This sometimes is also called gross profit, but is not the same. My understanding of EBITDA is that it is the gross revenues, minus virtually all expenses other than the three mentioned above. So cash flow measured this way can be affected by a lot of things, including significant changes in R&D expenses, other major capital expenses, a lot of new hiring, layoffs with associated severance packages, launching a new product line with heavy marketing expenses, etc. While dividends are not deductible from the corp taxes, I do believe they are deducted ahead of EBITDA, thus they serve to reduce taxable income. That is why they are taxable income to the recipient. At least that's my logic, altho I seem to recall someone trying to convince me they are taxed at both the corp and the recipient level. The only way I know to understand changes in cash flow is to compare the 10Qs and the 10K, and see where changes are occurring out of proportion to the change in gross revenue. Tom Worley stkguru@netside.net - ----- Original Message ----- From: To: Sent: Thursday, May 03, 2001 2:27 PM Subject: Re: [CANSLIM] SERO Tom: One reason, I believe, cash-flow will drop is when there is an increase in dividends. Companies must pay taxes on their earnings, and dividends cannot be deducted from the taxes (ie. it is a discretionary payment that the company must pay out of earnings). Can you think of any other reason why earnings increase, but cash-flow comes in as less than earnings? The only other reason I can think of is because the company is paying its debts (or what if foresees as debts) ahead of time. jans jans In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, stkguru@netside.net writes: << ...Also, cash flow is slightly lower than last year's earnings.... >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 03 May 2001 18:15:29 -0600 From: esetser Subject: Re: [CANSLIM] IBD Investors Corner today. I think this is only a consideration when the stock breaks out. I don't generally look at it at all until I'm considering a buy, and even then, it can be difficult to judge where the RS will be after the strong day! At 11:58 AM 5/3/01 -0700, you wrote: >I guess we should start indicating whether thr RS line >is at a new high when listing the numbers? > >Kent Norman > >--- Bill Triffet wrote: >> With some failed breakouts, as usual IBD reads this >> group (I'm sure of that >> now). Today's Investors Corner is about breakouts >> that can succeed after a >> false start. >> >> Interesting to note: at the time of the b/o the RS >> line should be at a new >> high... something I have been failing to notice (not >> any more though). My >> only problem with this is how does this work with >> stocks that are not at all >> time highs that are now forming new bases after >> falling so much last year? I >> can't see the RS line hitting any new highs soon. >> I don't have any specific issues at this time to >> list but as the days go by >> and more bases are formed by the techs, I feel this >> will be the situation >> we'll be in. Any thoughts? >> >> -Bill Triffet >> >> >> >> - >> -To subscribe/unsubscribe, email >> "majordomo@xmission.com" >> -In the email body, write "subscribe canslim" or >> -"unsubscribe canslim". Do not use quotes in your >email. > > >__________________________________________________ >Do You Yahoo!? >Yahoo! Auctions - buy the things you want at great prices >http://auctions.yahoo.com/ > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 03 May 2001 18:23:40 -0600 From: esetser Subject: Re: [CANSLIM] SERO Really, double taxation? What a shame. Think about driving your car. 1 - You earn some money, pay income tax. 2 - You buy the car, pay sales tax. 3 - You fill it up, pay gasoline tax. 4 - Generally, you pay property tax each year for owning it. Hmm, I consider double or more taxation business as usual!! At 07:36 PM 5/3/01 -0400, you wrote: >Thanks, Eric, never having done corp taxes I knew I was fuzzy on >the issue. Still, doesn't seem fair for Uncle Sam to take a slice >of the pie twice. Maybe Bush can be petitioned for tax relief for >one of us, preferably the corps. Then they would have more >profits to pay out, or better EPS, and smaller companies would >have an added incentive to start a dividend program when earnings >are good and expected to get better (one of my more successful >signals to plunge into a smaller company is when they initiate a >dividend). > >Tom Worley >stkguru@netside.net > > >----- Original Message ----- >From: Shen, Eric >To: >Sent: Thursday, May 03, 2001 7:22 PM >Subject: RE: [CANSLIM] SERO > > > >Dividends are taxed twice - both at the corporate level and at >the >individual level. It's commonly referred to as "double taxation" > >http://www.ncpa.org/pi/taxes/double.html >http://www.yk.psu.edu/~dxl31/econ4/lecture2.html (look under >Business Firms) > > >-----Original Message----- >From: Tom Worley [mailto:stkguru@netside.net] >Sent: Thursday, May 03, 2001 4:06 PM >To: canslim@lists.xmission.com >Subject: Re: [CANSLIM] SERO > > >Hi Jans, > >I am not an accountant, but maybe we have one in the group who >can jump in here. > >My understanding of cash flow is that it is EBITDA (Earnings >Before Income Tax Depreciation Amortization). This sometimes is >also called gross profit, but is not the same. > >My understanding of EBITDA is that it is the gross revenues, >minus virtually all expenses other than the three mentioned >above. So cash flow measured this way can be affected by a lot of >things, including significant changes in R&D expenses, other >major capital expenses, a lot of new hiring, layoffs with >associated severance packages, launching a new product line with >heavy marketing expenses, etc. > >While dividends are not deductible from the corp taxes, I do >believe they are deducted ahead of EBITDA, thus they serve to >reduce taxable income. That is why they are taxable income to the >recipient. At least that's my logic, altho I seem to recall >someone trying to convince me they are taxed at both the corp and >the recipient level. > >The only way I know to understand changes in cash flow is to >compare the 10Qs and the 10K, and see where changes are occurring >out of proportion to the change in gross revenue. > >Tom Worley >stkguru@netside.net > > >----- Original Message ----- >From: >To: >Sent: Thursday, May 03, 2001 2:27 PM >Subject: Re: [CANSLIM] SERO > > >Tom: > > One reason, I believe, cash-flow will drop is when there is >an increase >in dividends. Companies must pay taxes on their earnings, and >dividends >cannot be deducted from the taxes (ie. it is a discretionary >payment that the >company must pay out of earnings). > > Can you think of any other reason why earnings increase, but >cash-flow >comes in as less than earnings? The only other reason I can >think of is >because the company is paying its debts (or what if foresees as >debts) ahead >of time. > >jans > > > >jans > > >In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, >stkguru@netside.net writes: > ><< ...Also, cash > flow is slightly lower than last year's earnings.... >> > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 21:00:25 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] CHIC Anna, I am inclined to agree with Earl. My initial impression after reading your email and looking at the chart was to say, "come on, give the stock a break, it's had five days up from 30, it's entitled to give a little sacrifice to the stock gods". Earl's comments just strengthen that sense. Up/down ratio is still a very healthy 2.1, I would try to watch it closely, but give it some room to roam. Tom Worley stkguru@netside.net - ----- Original Message ----- From: esetser To: Sent: Thursday, May 03, 2001 8:14 PM Subject: Re: [CANSLIM] CHIC After 5 consecutive up days starting with a strong move up, I feel today was a justified break to take a rest and move with the market. The stock traded quite a bit lower during the day, but finished mid-range. I'm not concerned about today's action, but I would be if the stock moved 2 or 3% lower over the next few days. For now, I'm okay to sit on it and wait for better days. At 02:27 PM 5/3/01 -0400, you wrote: > >Hi, > >what is group's opinion on CHIC? I do not like today's behaviour - it >seems to me it is ready to go down. > >Anna > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 3 May 2001 21:03:51 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] SERO :You have a point, Earl, but with the examples there is at least some form of "value added" benefit, or a change in product. Taxing the corps on their profits, then taxing us again on their sharing of those profits, has not added any further benefit, or changed the product at all. Tom Worley stkguru@netside.net - ----- Original Message ----- From: esetser To: Sent: Thursday, May 03, 2001 8:23 PM Subject: Re: [CANSLIM] SERO Really, double taxation? What a shame. Think about driving your car. 1 - You earn some money, pay income tax. 2 - You buy the car, pay sales tax. 3 - You fill it up, pay gasoline tax. 4 - Generally, you pay property tax each year for owning it. Hmm, I consider double or more taxation business as usual!! At 07:36 PM 5/3/01 -0400, you wrote: >Thanks, Eric, never having done corp taxes I knew I was fuzzy on >the issue. Still, doesn't seem fair for Uncle Sam to take a slice >of the pie twice. Maybe Bush can be petitioned for tax relief for >one of us, preferably the corps. Then they would have more >profits to pay out, or better EPS, and smaller companies would >have an added incentive to start a dividend program when earnings >are good and expected to get better (one of my more successful >signals to plunge into a smaller company is when they initiate a >dividend). > >Tom Worley >stkguru@netside.net > > >----- Original Message ----- >From: Shen, Eric >To: >Sent: Thursday, May 03, 2001 7:22 PM >Subject: RE: [CANSLIM] SERO > > > >Dividends are taxed twice - both at the corporate level and at >the >individual level. It's commonly referred to as "double taxation" > >http://www.ncpa.org/pi/taxes/double.html >http://www.yk.psu.edu/~dxl31/econ4/lecture2.html (look under >Business Firms) > > >-----Original Message----- >From: Tom Worley [mailto:stkguru@netside.net] >Sent: Thursday, May 03, 2001 4:06 PM >To: canslim@lists.xmission.com >Subject: Re: [CANSLIM] SERO > > >Hi Jans, > >I am not an accountant, but maybe we have one in the group who >can jump in here. > >My understanding of cash flow is that it is EBITDA (Earnings >Before Income Tax Depreciation Amortization). This sometimes is >also called gross profit, but is not the same. > >My understanding of EBITDA is that it is the gross revenues, >minus virtually all expenses other than the three mentioned >above. So cash flow measured this way can be affected by a lot of >things, including significant changes in R&D expenses, other >major capital expenses, a lot of new hiring, layoffs with >associated severance packages, launching a new product line with >heavy marketing expenses, etc. > >While dividends are not deductible from the corp taxes, I do >believe they are deducted ahead of EBITDA, thus they serve to >reduce taxable income. That is why they are taxable income to the >recipient. At least that's my logic, altho I seem to recall >someone trying to convince me they are taxed at both the corp and >the recipient level. > >The only way I know to understand changes in cash flow is to >compare the 10Qs and the 10K, and see where changes are occurring >out of proportion to the change in gross revenue. > >Tom Worley >stkguru@netside.net > > >----- Original Message ----- >From: >To: >Sent: Thursday, May 03, 2001 2:27 PM >Subject: Re: [CANSLIM] SERO > > >Tom: > > One reason, I believe, cash-flow will drop is when there is >an increase >in dividends. Companies must pay taxes on their earnings, and >dividends >cannot be deducted from the taxes (ie. it is a discretionary >payment that the >company must pay out of earnings). > > Can you think of any other reason why earnings increase, but >cash-flow >comes in as less than earnings? The only other reason I can >think of is >because the company is paying its debts (or what if foresees as >debts) ahead >of time. > >jans > > > >jans > > >In a message dated 5/2/2001 11:04:43 PM Eastern Daylight Time, >stkguru@netside.net writes: > ><< ...Also, cash > flow is slightly lower than last year's earnings.... >> > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > > >- >-To subscribe/unsubscribe, email "majordomo@xmission.com" >-In the email body, write "subscribe canslim" or >-"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ End of canslim-digest V2 #1337 ****************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.