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No. of Recommendations: 7
Well, after surfing thru the JDSU board, TMF Grape pointed out that :
1) Short-term investments are included in cash when
calculating the flow ratio.
2) For calculating net margins (from net income), you
should eliminate the acquisition related charges and
the amortization.
His post in the JDSU board regarding these 2 issues can
be found here:
http://boards.fool.com/Message.asp?id=1150100001053008&sort=postdate

So, I have restated my results by accounting for the
above 2 changes.

Financial AnalysiCompany Being Evaluated Competitor #1 Competitor #2 Competitor #3

JDS Uniphase Corp. E- Tek Dynamics Nortel SDL Inc.
(JDSU) (ETEK) (NT) (SDLI)
Current Period Year-ago PeriodYear-over-Year Current Period Current Period Current Period
Sept 30/99 Sept 30/98 Growth Sept 30/99 Sept 30/99 Sept 30/99
Income Statement . . .
Sales 230.10 57.40 3.01 60.34 5393.00 47.51
Cost of Goods S 125.20 28.90 3.33 30.18 3099.00 26.66
Net Income 59.00 8.10 6.28 13.31 150.00 7.59
Shares Outstand 168.50 84.50 0.99

Balance Sheet . . .
Cash & Equivale 959.20 75.40 11.72 178.72 1213.00 292.35
Current Assets 1,218.70 463.60 1.63 268.93 11673.00 368.99
Short-term Debt 0.00 0.00 No Debt 6.98 351.00 0.00
Current Liabili 148.80 148.80 0.00 69.74 7019.00 30.26
Long-term Debt 0.00 0.00 No Debt 17.64 1470.00 4.25
1.00 1.00 1.00Competitors
Margins & Ratios . . .
Gross Margins 0.46 0.50 (4.06) 0.50 0.43 0.44 45.5%
Net Margins 0.26 0.14 11.53 0.22 0.03 0.16 13.6%
Cash-to-Debt No Debt! No Debt! No Debt! 7.26 0.67 68.79 0.91
Net Cash 959.20 75.40 11.72 154.09 -608.00 288.10 -55.3
Fool Flow Ratio 1.74 2.61 (0.33) 1.44 1.57 2.53 1.85


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Ranking Rule Makers

1) Brand Points (0-1) 3) Financial Dire Points (0-3)
Familiarity 0 Sales Growth 3
Openness 1 Gross Margins 0
Optimism 1 Net Margins 3
Legitimacy 1 Shares Outstandin 0
Inevitability 0 Cash-to-Debt 3
Solitariness 1 Fool Flow Ratio 3
Humor 1 Expansion Potenti 3
Subtotal 5 Subtotal 15


2) Financial Location Points (0-2) 4) Monopoly Status Points (0-4)
Mass Market Habit 1 Gross Margins 2
Gross Margins 1 Net Margins 4
Net Margins 2 Net Cash 4
Cash-to-Debt 2 Fool Flow Ratio 2
Fool Flow Ratio 0 Convenience 4
Your Interest 1 Subtotal 16
Subtotal 7
5) Your Enjoyment 1

Total Score 44 Second Tier

Wow! What a difference these 2 simple changes make!
JDSU has a stash of short term investments (almost as
much as its stash of cash), and also by taking out the
acquisition related charges helped to bump up the net
income into positive territory.

I think that JDSU should definitely be chosen as the next addition to the Rule Maker Port!


Thx.
Cheers,
Albert
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