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Financial Skeptic

Accentuating the caveat emptor with critical commentary concerning investor relations and financial communications. I look at how information is (mis)managed and manipulated thereby creating possible investors losses.

Advanced Medical Optics Poor Optics

Posted on 09/26/2006 00:00 AM | Link | Post Comment
Advanced Medical Optics AMO (EYE) has revised guidance downward claiming that the shift to higher margin products is taking longer than anticipated. Long term debt has mounted at an alarming rate almost doubling since year end from $500 million to $871 million at last quarter. Much of this debt was taken on assuming higher margins could adequately debt service the obligations. The company soft peddled their leverage saying that it expects total debt outstanding to be approximately $900 million at the end of the third quarter and adjusted cash from operations for the nine months ended September 29, 2006 to exceed $70 million. Management has been playing with fire. Investors are getting burned.
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