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Sprint Corporation Message Board

  • loclac loclac May 28, 2008 8:52 AM Flag

    It's the balance sheet, stupid

    While DT may well have looked at S no doubt what they saw was $40 bil in debt and far less in assets. They still have $30 bil of intangible assets (of questionable value, remember the nxtl write-off) and another $30 bil in property and equipment that's no doubt very overstated. They have maybe $10 bil in cash, receivables and other assets of real value to offset the huge debt. When you buy a company you buy the debt, so if you look at their assets in the context of real value the company is virtually worthless. Nxtl's worth maybe $10 bil, wi-max is crap and their customer base is melting quicker than a snowball in hell. The billion dollar question here is how this dog is selling in the $8's. No one could possibly pay more than $4 a share with this debt in place so although some may look they'll never move until the stk gets well below that price.

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