Asensio & Co. Announces Investment Opinion on Tyco International.Business Editors NOTE TO EDITORS: The following is an investment opinion issued by Asensio & Co. NEW YORK--(BUSINESS WIRE)--June 13, 2002 Asensio & Co.: Tyco's Accounting Concerns Appear Grossly Over-Blown Tyco International For the unrelated division of Mattel, see . Tyco International Ltd. NYSE: TYC is a diversified manufacturing conglomerate incorporated in Bermuda, with United States operational headquarters in New Jersey. Ltd.'s (NYSE NYSE See: New York Stock Exchange : TYC TYC Texas Youth Commission TYC Torneos Y Competencias (Argentina) TYC To Your Credit TYC Toronto Youth Cabinet (youth members of the Toronto City Council) TYC Teconnaught Youth Club (Ireland) , Price: $10.15) stock remains severely depressed on credit concerns. At yesterday's prices, Tyco's bonds and bank debt implied that the market was valuing Tyco at approximately 2.6 times Latest Twelve Month EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become . We are aware of the market's concern that Tyco's reported EBITDA may be overstated o·ver·state tr.v. o·ver·stat·ed, o·ver·stat·ing, o·ver·states To state in exaggerated terms. See Synonyms at exaggerate. o . We are aware of the accounting policies at issue. Our Tyco valuation discounts reported EBITDA by 20% and increases historical capital expenditures by 30%. Our estimated free cash flow based on these adjustments, which we believe to be adequate and conservative, is sufficient to allow us to believe Tyco's debt is manageable. Copyright 2002 by Asensio & Company, Inc. All rights reserved. This report should not be construed as an offer to sell or solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of an offer to buy any securities. Opinions expressed are subject to change without notice. This report has been prepared from original sources and data, which we believe to be reliable but accuracy is not guaranteed. This research report was prepared by Asensio & Company, Inc. whose stockholders, officers and employees may from time to time acquire, hold or sell a position in the securities mentioned herein. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion