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National Presto Industries Inc. Message Board

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  • mikehunt84010: Did you see something particular in the annual report that you think made the stock drop?

    I also want to ask another question about your message 1089 on 3-16-03. That message refers to goodwill accounting for about one-half of the stock market. Where you referring to the usually phony accounting goodwill on financial statements? Would you please explain?

    By the way, I am one of the conspirators that made the price go up today in an efort to ease your conscience for making it go down lately.

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    • Biblioguy made a good analysis of the annual. Poor earnings is the problem.

      Regarding goodwill: yes I was referring to all the phoney accounting goodwill that has been booked when companies overpay in purchasing other companies. See Broadcom for example. Overstates earnings big time for a while but like any ponzi comes home to roost. Recent WSJ's have reported goodwill makes up about one third of the net worth of traded stocks. I saw this same accounting tomfoolery in the late 1960's and early 1970's. It was resurrected in the 1990's to again fleece the naive public. I always subtract out goodwill in my analysis of value.

      The other problem that is abusive is not reflecting full dilution of all shares in computing per share earnings. Should not have to dig for this info.

      A recent article in the WSJ said most directors have little knowledge of how to decipher financial data. No wonder we have a problem. The average person holding stocks in one form or another can't even fathom the stupidity and skuldugery that exists on wall street.

      But for those with control over their emotions, some bull and bear market experience, and, ability and knowledge of how to analize stocks, it can be a gold mine, especially for the little guy. The big guys lack liqudity.

      • 1 Reply to mikehunt84010
      • mikehunt84010: You are so correct about the goodwill and bad accounting. I simply refuse to buy any company that has much "accounting goodwill". I can't understand why Wall Street is not more suspicious of the serial acquirers that do not seem to care what they pay for a business. I guess they simply worship the god of growth and don't care how it is accomplished until it blows up.

        Do you have any stocks that you do like now? I would be interested in looking at them if you do. Thanks.

 
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