Jonathan Goldberg on Value Investing - Topic: Banking on Barnes & Noble (NYSE:BKS)

akwon on Banking on Barnes & Noble (NYSE:BKS)

Thu, 22 Oct 2009 17:19:07 -0700

I haven't had the time to do a detailed study of BKS' reports, but just from glancing over their financial statement from google finance, the company is at 1 bil market valuation, and they have around 1 bil in net PPE. So hey, thats some decent downside protection, tho I still dont' feel too comfortable in relying on PPE as something to mitigate downside risk, I still prefer cash for that.

escondido on Banking on Barnes & Noble (NYSE:BKS)

Wed, 21 Oct 2009 09:51:10 -0700

While I am not as concerned about the working capital management of BKS as akwon (they have been able to decrease working capital requirements for the 26 week period ending Aug 1 each year since 2006), a lot of BKS's earnings power for 2009 is being driven by lower capex, which looking at historical trends, appears unsustainable. Due to this one time fluctuation, I would look at the past 3 to 5 years as a more realistic valuation and settle on an entry price that is below BKS's current price.

akwon on Banking on Barnes & Noble (NYSE:BKS)

Tue, 20 Oct 2009 19:15:11 -0700

About Barnes and Nobles, I am actually more worried that the company will go bankrupted before it implements its plan. Seeings how their payables are more than their cash equivelant at hand and their net income combined. This company will probably have to eventually leverage themselves to pay for the new ebook strategy as well as their cash flow problems. With negative operating cash flows the past two quarters, this company feels more of a speculative play for me, than a value play. Maybe if that had 500 mil- 1 bil more in cash at hand I would be more comfortable with this company.

Jonathan Goldberg on Banking on Barnes & Noble (NYSE:BKS)

Mon, 19 Oct 2009 01:00:44 -0700