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Boston Scientific Corporation Message Board

  • thisissurreal thisissurreal Jan 20, 2000 9:52 AM Flag

    BSX has good relationship with analysts


    12/16/99 - Abn Amro reiterates buy,
    believe gross and operating margins will be essentially
    flat next year.

    1/20/00 - Boston Scientifc Cut
    to 'Outperform' at ABN Amro.

    What has changed
    this past month to warrant the downgrade?

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    • Cruzer, the oil price is more a function of
      demand than supply. The recovering economies you point
      out in Europe and Asia have been demanding more oil
      and oil based products, plastics, etc. That has been
      accelerating for more than a year, and I don't remember that
      there has been any supply shrinkage to speak

      As an oil investor, I know that it takes quite a bit
      of time to get more production going. It will chase
      the price though, and supply will surely bring the
      price back to a more normal point. There is only one
      other thing on earth more plentiful than oil; that is
      sea water.

      I doubt that oil will do more than
      slow down growth a bit, but that's an educated guess.
      Healthier economies should drive demand for more exotic
      medical and other products, IMHO.


    • Well, LU is either the waitress at the local
      burger stand outside my double-wide, or Lucent
      Technologies, the old Bell Labs. Look at their profile and

      Debt is actually very attractive to start-up
      companies. Money is fairly cheap today, even at 8%'ish
      levels. The whole name of the game for start-ups is
      equity and how to get money without giving up equity.
      Debt is attractive for those reasons, plus in a
      liquidation scenario, debt gets serviced before preferred
      shares so if the company show signs of survival, debt is
      relatively easy to get.

    • Closed one day at 69.XX Opened the next day around 52. Look at their chart, then read the press releases of those two days. It was quite dramatic.


    • A lot of debt can sink a company. The amount of
      debt in some of the startups is dismaying. Doesn't the
      amount of debt that a company has figure into the
      earnings of a company? And then into the PE ratio? And
      pardon my ignorance; what is LU?

      I guess it is
      time for the PE discussion. Discussion of the P/E
      makes BSC look good, it is cheap now. I am not sure all
      of the questions have been answered but will have to
      wait. route17cruzer.

    • IMO OPEC is a good example of how market forces
      discipline people who try to corner markets. You screw the
      customer, he goes out of business and then there is no
      market. Now the seller is screwed too. If prices are too
      high sales fall. It is a 15 second course in
      economics. These OPEC guys have tried this a lot of times in
      the past and usually it doesn't work. They hold down
      productiona and prices rise but someone in Opec cheats and
      sells more that he is alloted and the prices fall. The
      the OPEC members fall over themselves chopping prices
      until the cycle is repeated. While I would not call
      these guys friends they are too disorganized to be

    • The predicted increase is 25 points. I am
      wondering if it will be more but since the oil increases I
      doubt it. The oil increase may not slow things down
      immediately but it will soon. Maybe Greenspan is thinking
      this too. I am also wondering if Iraq is coming on
      line soon. This may have been done to keep Iraq from
      knocking the bottom out of the market. Iraq is pretty
      desperate for income.

      What does this have to do
      with Med stocks and BSX? My opinion it will float all
      of the medical boats.

    • Yikes - recession? The older I get the more I
      think that recessions are a type of "group screw-it"
      than anything else. Sure, rising prices could create
      rising interest rates which causes a slow down in
      spending. Unfortunately they seem to be orchestrated by the
      FED as opposed to being natural. Look at '94, clearly
      FED endowed. But that said, the best way to make
      money is to go into a recession with money - you always
      come out with more. I actually am more concerned about
      the amazing amount of debt that some of these
      companies are starting to amass. What happened to LU when
      they missed. The analysts did the math, looked at all
      that debt and rising rates and absolutely hammered
      them. I think this is a new paradigm (we like that word
      alot in the Valley) where there are going to be
      surgical excisions of companies that underperform.


    • I whole heartedly agree about oil. Our best friends are OPEC - you gotta love a group that essentially form a controlling market, yet would rather cut each other's balls than ours!

    • This country moves most goods with oil. I think
      that we have our head in the sand if we do not pay
      attention to trends in oil prices. OPEC seems to beholding
      the line this time with production quotas. Asia's
      recovery will only increase world demand and make it
      possible for the "cheaters" to have less effect on overall
      supply. I filled up this morning at 1.39 a gallon here in
      Minnesota. That is the highest price at the pump in years.
      I'm going to stick my neck out and predict a 50 basis
      point rise in interest rates next week when Greenspan &
      Co. meet.

    • When opec has tried to jack up the price of oil
      by cutting production usually it works for a while
      until one of the oil producers gets a little greedy
      then the cutback falls appart. This is an unfortunate
      time for such an action. With the Asian economies
      recovering and European ones starting to prosper along comes
      high oil prices. Since oil affects just about every
      part of the economy it will have a slowing effect on
      every aspect of the economy. It is going to take a
      little bit of time as the cheaper inventories draw down,
      but this is the event that will pull the economy into
      recession. I am going to stick my neck out on this one.

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