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What would be extremely useful from here is if we could get some better sense of the financial direction of these companies.

Okay, Tom. I did work out the numbers over the last 3 years. Here's what I found (using Zacks year-end #'s):

Forget about LVMHY. I couldn't find enough numbers to even calculate their performance.

I must be missing something on Pioneer. I got a current flow ratio of 2.44 and unleveraged of 3.47 (much different than in the nominating post). Looks to me like this is related to their relatively high inventory levels. Gross margin has also been falling.

Directionally, TLAB is one of the best. Gross and Net Margin has been decreasing, Flow (unlev and lev) have both been falling. CTD is increasing as well. The only negative I found was that A/R turns went up last year (inventory turns have been falling though). ROE has been increasing as well. To me, this one definitely makes the cut.

Not surprisingly, Dell is another one that has been moving in the right direction. I can understand if it's included, but I still am leery because of my feeling that it will just have to be watched closer than the rest of our holdings.

Medtronic, which wasn't on your list, doesn't make this cut. Margins have been improving, but the flow is going in the wrong direction and CTD is not consistent. Knock it off my list.

Schering -- Margins have been flat (but at just over 80% it's hard to complain). Net margin has improved slightly. The lev flow is pretty much even (though up slightly -- 0.69, 0.70, 0.76). Unlev flow is falling. CTD, ROE, A/R Turns and Inv turns are all moving in the right direction.

J&J -- Margins have been improving (which they have to due to a slowdown in sales growth. Both flow ratios are relatively stable. They have been doing a good job at paying down debt. ROE has fallen slightly, A/R turns are getting better, inventory turns worse.

Amgen, margins moving in the right direction. Flow is about flat. Cash-Debt has been going down though. A/R and Inv Turns are increasing (which coincides with my earlier post about their business model changes).

If I had to pick 3 out of this group, I'd definitely go with TLAB and SGP. The numbers say that Dell should be the third choice, but I just can't do it. I'd take J&J instead (yes, I know that many others like Dell, but this is just my opinion).

Phil
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