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Becton, Dickinson and Company Message Board

  • HedgeGP HedgeGP Aug 7, 2000 12:40 PM Flag

    NEW HERE

    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
    effortlessly.

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    • Yes, it is the same one who did such a wonderful
      job increasing Yale's endowment. I don't have the
      title, I have only read a review of the book, which came
      out recently. The reviewer found it extremely
      "dense", almost unreadable, so I did not buy it.

    • Thanks. Is that the David Swenson who was with
      Yale's endowment fund? What's the book? I used to be
      with an LBO fund and the guys I worked with knew him
      very well if its the same guy -- I'm a bit out of THAT
      loop now.

    • Well said. It's obvious by the wisdom of your
      comments that you really are, in fact, what you say you
      are. I own a great deal of BDX, and I will be patient.
      As an aside, the fact, as you say, that private
      money will likely accept only a 15% return is
      indicative of the fact that while the 90's were the decade
      of best returns in the private arena, we are now in
      a climate where you no longer have to "overpay for
      liquidity" as David Swensen says in his recent book. Public
      situations like BDX will produce excellent returns.

    • According to Babc America's strong buy
      recommendation of Med-Design (MEDC), "We think Becton Dickinson
      licensed Med Design's technology technology because
      centerline retractable appears to be the best design because
      of its simplicity and ease of use. Med-Design's
      products are similar in appearance and size to standard
      devices. The needle retracts automatically and permanently
      into the body of the device after use. There is no
      change in the commonly used one-handed injection
      technique."

      "OSHA's safety mandate creates the potential for BD to
      introduce differentiated devices and significantly improve
      its profitablity. Not only do prices rise by a factor
      of two to three, but BD should be able to slightly
      improve gross profit margins because we think it should
      be able to manufacture retractable syringes for less
      than it current cost to produce sleeve-type safety
      syringes. BD's current safety syringes sell for $0.31, but
      we expect the retractable to be prices as a premium
      product. Since BD is essentially a monopoly, we don't
      expect much or any price erosion in the early years and
      not more than 1-2% per year after that. Even if gross
      margins remain the same (and we suspect they rise), BD
      should be able to more than double its gross profit
      dollars in its largest markets."

      "Two competitors
      with retractable syringes include Dallas based
      Retractable Technologies (RTI) and London-based New Medical
      Enterprises (NME). In our opinion, companies that attempted
      to build up manufacturing and distribution to
      compete with BD have faulty strategies. We think
      successful navigation of patent litigation and the
      associated expenses, if necessary, depend on
      800-pound-gorilla status."

    • Look it says so right in my anonymous sign on.
      Thats why I post to an anonymous message board. I am
      sure the Yahoo message board will be the source of
      real change. Most serious investors dumped the WSJ for
      this.

      When you sold your company how many of the little
      people lost their jobs for the immense shareholder
      wealth? Who cares, we are shareholders we are not in it
      for the long run. Damn these people who think we have
      time for them to turn this company around. Lets get it
      over and done with so we can make our immense
      shareholder wealth!!!

    • What does building a 103 year old company have to
      do with anything? You probably are an employee and
      thus are nervous about any thought of a takeover of
      the company- nonetheless it seems that something
      drastic has to be done. Either the company has to improve
      its performance significantly and quickly in order to
      enhance shareholder value or some external force will
      intervene.After all in the final analysis it's the shareholders'
      money that is at stake and although any company is
      entitled to a temporary misstep, BD's doldrums have been
      going on for a totally unacceptable length of time.
      Good luck to you and BD.

    • 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
      rate.

      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.

    • 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
      movement soon.

    • 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?

    • 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
      accountability?

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