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Has anyone found any companies that score above 50 using the new RM calculations for Foolish Flow ratio and cash to debt?


Actually, in the post immediately prior to yours (#2295), I ranked Intel's most recent quarter versus AMD and National Semi, and Intel scored a 54. Interestingly enough, I may have even short-changed Intel a little bit because I accidentally used the balance sheet numbers from the Dec '98 quarter, rather than the year-ago quarter (Mar '98). Intel is without a doubt the Rule Maker exemplar of the microprocessor industry.

Should we lower the ranges of what's considered Tier 1/Tier 2/Tier 3 when we are using the new formulas?

I may be in the minority on this, but I think it's advantageous to have a strict scoring system. The current tier structure makes a score above 50 a truly remarkable accomplishment, and even a score above 40 is pretty darn good (especially if we have reason to believe the company is moving up).

I've scored several of our companies recently, and each time I grow more convinced that our present ranking system is dead-on right. For example, I recently scored Pfizer vs Schering-Plough using their 1998 full-year numbers. Pfizer scored 48, so it's at the top end of Tier II. This seems exactly right to me considering that in almost every way Pfizer is a fantastic company, but its Flowie isn't quite up to par. So, 48 registers in my mind as the fair score for the company. Another example is Coke. I just scored it vs Pepsi based on their full-year '98 numbers, and Big Red came in with a 42. Considering that '98 was a tough year with the turbulence in foreign economies, a low-end Tier II seems right. I expect that when overseas markets regain some normalcy, Coke will score closer to 50. By the way, Pepsi scored a measly 27 when I turned the tables.

What do other Fools think on this issue?

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