With decent revenue growth, better bottom line
growth, some solid products and a valuation at 16x or so,
what am I missing? Should hold up well in a downturn
and more important, even if it doesn't knock your
socks off re internal growth, why won't it just get
bought out in the $40-45 range. I mean, it's so cheap
that you have to figure someone could easily swallow
them up, cut costs, further develop promising products
etc. and they could do it in the $40 range rather
What you're missing is that the company has
disappointed Wall Street too often and even when the earnings
consensus has been met the numbers are not clean,e.g.,a few
pennies of the earnings have been from the gain on the
sale of investments.As for the sale of BD,why has it
not happened yet? As a shareholder I share your pain
but not your optimism.
I'm not a shareholder yet -- I like to invest in
situations at points of extreme pain. I agree re the
earnings issues. However, I just feel like there is too
much asset value here. Maybe I should make some noise?
I have to guess that there are several companies in
the sector that would be interested at up to $40 and
BDX's results have certainly been
modest. However, realize that even in '99 when it
corrected severely, it was still trading at like 20x foward
numbers. At 15-16X, still growing decently, and with a $5
billion market cap, it even becomes an interesting
candidate for a financial buyer (i.e. LBO group), many of
who are flush with capital.
The Street is also very concerned about the
system "Monster" called SAP that the Company had been
expecting/projecting major cost savings from but has instead invested
$200+ million with questionable future
(look at Market Guide analyst reports available from
Appreciate your comments.BDX certainly looks
undervalued with expected EPS of $1.60 this year(ending 9/30)
and $1.78 next.But as they say, don't fight the tape
and day in and day out there always is a heck of a
lot of stock available for sale, blunting any
attempts at a rally in the stock.
I don't intend to fight the tape. I have
determined what I think BDX is "worth" and I am happy to buy
it today at a substantial discount to this value. I
beleive there will be a catalyst that will unlock this
value over the next year, and it won't be accelerating
earnings, if you know what I mean.
Why are you so negative towards King 800m? I
thought his message made a lot of sense. Doesn't it
bother you that the stock price is about half of what it
was 2 years ago?Where is the management
With shareholders like you, it's clear why
management is so complacent. But some of us in the
shareholder community demand performance. By the way, I am a
retired CFO of a Fortune 500 company. I have helped build
a company, which we then sold, creating immense
shareholder wealth in the process. What have you done?
I had much respect for Mr. Castellini. He made
some much needed changes at BD. But as an investor and
an employee I am very disappointed with his results.
I continue to be hopeful that Mr. Ludwig will
agressively turn this situation arround. I think he has the
strength to do it. There a lot of people counting on him
to make some tough decisions. We need to see some
Don't worry about that comment. Undervalued
assets only remain undervalued for so long. There is
real value here, particulalry to a strategic buyer.
And the good news is, even if we can't get the
strategic buyers involved, there has been a ton of
LBO/private equity money raise over the past few years, which
probably at this point has only a 15% hurdle
This isn't a trading stock. And remember, you don't
buy these things after the rumors start. You just buy
and wait and make your uncorrelated returns.
P.S. Speaking of corporate governance and investing,
check out CCN. On Friday it was trading down $8 to $62
intraday on rumors that it would not be sold to VIA. Then
it was halted and the rumors were confirmed. Some
sellers probably felt pretty lucky to be able to get out
at even $62 since a chunk of the price was based on
a probable deal with VIA. However, after the close,
NWS announced that THEY would be buying CCN for $85!
Gotta love Wall Street.