MGT 401, Final Activity-5

Income quality is poor. $36 million upwards by 2% and enhanced comes back from
rebuilding. Winning force of $1.5 billion. Standardized Capex? It is safe to say that
they are overspending capex now? -Joel Greenblatt question. Their profit are
exaggerated -not exactly the money income number.

In the event that you put a numerous on that income control, that expands your lapse
on the off chance that you are incorrect. Make certain to modify for "standardized
capex"

Substitution esteem. Substantial value and took out working rents and included back
brand esteem. Unmistakable book and included the expense of capital. A scope of
brand quality -a bit of the Greenwald book. I (Joel Greenblatt discover assessing
brand worth is hard to do). Regardless of the possibility that they have an incredible
arrangement on land -underestimated on the books, their rents may be financed
because of an under-business rent.

think that it exceptionally hard to do. You can't twofold number. Yes, land is
underestimated on the books, however the income are exaggerated because of
under business sector rents. Try not to twofold check in your valuation.

Negative FCF. Regardless of the possibility that liberal edges and 3% development,
you get negative CF. The amount of left do they have for profits -include back profits.
$400 billion in deals, constrained CF, Wal-Mart going to come in. This is appalling. All
numbers are weakening.

They are to some degree less expensive to their comps. Separation valuation.

Joel Greenblatt: If I was an Investment financier for these fellows. Is it worth more
separated? A few organizations are worth all the more in a few business sectors.
They are productive in a few businesses and less in others. They may be a more

productive venture by being littler and separated. Maybe they have a huge measure
of worth in their land.

Work expense is a huge issue. Focused scene: Not No. 1 in neighborhood markets
aside from in a couple of neighborhoods.

Contends with Wal-Mart and Club Warehouses.

Exchanging with Peers no impetus for short. Yet, their business is powerless.

6.2% ROIC- -6.2% stinks. They claim their own land.

$30 billion in income. 10 premise focuses implies a huge change. Work expenses
are key. Their work is union. Neighborhood piece of the pie is key. Anyway, they are
just 1 to 2 in just 6 of their 15 businesses.

Post charge ROIC 1988 2004 is going down. Declining profits for resources, value
and capital.

In the end THE MARKET GETS IT RIGHT.

Neg. FCF under 0. Mgt. has been offering. Stake in Company versus their pay rates
for mgt. is vital to concentrate on for remuneration.

Working leases may need to be promoted for examination purposes. Exchanging

stock so net salary falsely helped. No annuity arrangement recorded under
supported. No expensing of alternatives in the wage explanation. Net wage
misleadingly high. D&A is $948 mil. No opening stores. Overspending on capex?
Undercounting D&A?

Their income ought to deduct more for D&A.

Different on Earnings Power. Make sense of ordinary capex is key. 1.5x capex more
noteworthy than D&A.