GOOD CONSERVATIVE ACCOUNTING
by: kbloisab2 01/28/06 07:22 am
Msg: 3361 of 3370
Our 8 person investment fund includes two accountants--we have a big investment in CX, and it is one of our favotite stocks.
We were very impressed by the honest and up front way this company accounted from the take over costs from RMC.
To show short term profits, or to meet Wall Street expectations, the approx. $220M in one time take over costs could have been capitilized, or booked as good will or intangible costs, etc. This is a common practice in the U.S.A. because it complies with GAAP, but thankfully this type of accounting is not common in Mexico.
We see CX as a super buy. It is a well managed profitable company in a growth business, with a just completed sucessful take over of RMC and a favorable resolution of a tariff dispute with the USA. Additionally, and critically, it has honest management, with a believable balance sheet and conservative accounting methods.
Folks, it does not get much better than that.!!!!
We used the small down turn to buy more shares. We see CX going to $100 in the next year to 18 months...
We are a conservative 8 person investment group, which was established 7 years ago. Therefore, we went through the dot.com. and tel.com market busts.
We have always been profitable and have capital in the $15M range. As to the stocks we own, we are usually short term in and out traders only holding positions for a short time. We rarely own stocks more than 18 months.