证券分析报告英文范本柯达公司(1)

1OffWallStreetConsultingGroup,Inc.P.O.Box2647Cambridge,MA02238tel:[phone]fax:[phone]internet:[e-mail]:Federalcopyrightlaw(Title17oftheU.S.Code)makesitillegaltoreproducethisreportbyanymeansandforanypurpose,unlessyouhaveourwrittenpermission.Copyrightinfringementcarriesastatutoryfineofupto$100,000perviolation.Weofferarewardof$2,000forinformationthatleadstothesuccessfulprosecutionofcopyrightviolators.NewRec:EastmanKodak(EK$43.23)September14,2001Position:SellTarget:$22Timing:2(1=aggressive;5=cautious)$000,000Q201AQ301EQ401E2001E2002E2003ERevs3,5923,4403,53513,54213,58313,393EPS$1.121.020.953.633.212.17Y/Y%-33%-27%40%-23%-12%-32%PE11.913.519.9PSR0.931.080.94Consens1.031.013.704.34n/aSharesOut:291MMarketCap:$12.6BFYE:DecSummary:EastmanKodakdevelops,manufacturesandsellsimagingproductsandservices.ConsumerImagingaccountsforabout53%ofrevenueand54%ofoperatingprofit.HealthImagingisabout16%ofrevenueand23%ofprofit.ProfessionalandOtherImagingconstitutethebalanceofrevenueandprofit.Kodakmanagementhasledinvestorstobelievethatitcangenerate$6Boffreecashflowoverthe2001-2005timeperiod.Thisistobeachievedmainlybyanaverageof5%-7%annualgrowthinrevenueandprofitintheConsumerImagingbusinessandby6%-9%annualgrowthinrevenueandearningsinHealthImaging.2ProfessionalissupposedtogrowinlowsingledigitsandOtherImagingissupposedtogrowby6%-11%onaverage.Inadditiontogeneratinghigheroperatingprofits,KodakclaimsthatitwillbeabletodoubleinventoryturnsandcutDSObyabout8days.Thetotalimpactofincreasedoperatingprofitsandbetterassetmanagementinconjunctionwithareductionincapitalspendingwould,theoretically,yieldthe$6Binfreecashflow.Wehavestudiedthesevariousclaimsandassumptions.OuranalysisconcludesthattheConsumerImagingbusinessshouldbeunabletomeetexpectations.Analystshopefor2%-4%growthforanalogand15%-25%growthfordigital.Theanalogbusinesshasbeendeclining.Wethinktheproblemisfundamental.Filmuseisdecliningduetothesuccessofdigitalphotography,andweexpectthetrendtocontinue.Ontheotherhand,thedigitalbusinesswillprovetobefarmoredifficultthanexpectedforKodaktonavigatetoprofitability.Kodak'sdigitalbusinesswillnotenjoythesamemarketadvantages,suchasmanufacturingscale,thatithasenjoyedinanalogfilm.WeexpecttheConsumerImagingbusinesstobewellshyofexpectations,withanoveralldeclineofabout2%nextyear,followedbyacceleratingdeclinesthrough2005.WhileinvestorsseemtohavehighhopesfortheHealthImagingbusiness,ourresearchsuggeststhatKodakwillsufferfromtheshiftthatisgoingonintheHealthImagingbusinessawayfromanalogfilmimagingandtowarddigitalimaging.Thecompanyclaimsthatitcansuccessfullynegotiatetheshift,withonlymarginalgrossmarginimpact.However,wedoubtthatdecliningfilmusageanddecliningfilmpriceswillbereplacedbyKodak'sdigitalhealthofferings.Kodak'sdigitalhealthoffering,now50%ofthesegmentrevenue,ismainlytheresultofthepurchaseofImation'smedicalimagingbusinessin1998.Themainproductisadryimagingprinterthatusesdryfilm.However,thebiggrowthareaindigitalhealthimagingproductsisPACS,(picturearchiveandcommunicationsystem).WithPACSimagesarekeptandvieweddigitally,whichmeansthattheneedfordryfilmisobviated.Kodak'sproblemisthatitdoesnotappeartohaveaPACSofferingthatisabletocompetewiththosesoldbyGE,Philips,Siemens,Agfa,Fujiandothers.WealsoexpecttheProfessionalsegmentandtheOtherImagingsegmenttobeshyofexpectations,butthisisjustasideshowrelativetothesizeofthedisappointmentweexpectinConsumerandinHealth.Onthebalancesheetside,inventoryturniscurrentlyabout5times,andhashistoricallybeenbetween3to5.5times.Wehavetroubleunderstandinghowitcangoto10times.DSOisnow69.Inthecurrentenvironment,gettingto60dayswillbeverychallenging.In2001andin2002weexpectKodaktogenerateabout$400Minfreecashflowineachfiscalyear.Thestreetexpects$600M-$800Min2002.Thereafter,however,iswherewereallypartwayswiththestreet.Weexpectfreecashtobeapositive$140Min2003,anegative$39Min2004andanegative