Tyco International Ltd. (NYSE:TYC)

CAPS Rating: 4 out of 5

A diversified manufacturing and service company that, through its subsidiaries, designs, manufactures, installs, monitors and services electronic security and fire protection systems and provides consulting, engineering and construction management.

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Member Avatar chrlipat (< 20) Submitted: 12/7/2006 4:14:28 PM : Outperform Start Price: $41.99 TYC Score: +30.66

the company is spinning off several subs.

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Member Avatar hirshey (96.19) Submitted: 12/6/2006 6:24:37 PM : Outperform Start Price: $42.55 TYC Score: +29.63

Real solid valuation measures. Good growth potential. Buffett is a believer.

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Member Avatar evanell (66.42) Submitted: 12/6/2006 6:15:15 PM : Outperform Start Price: $42.55 TYC Score: +29.63

After watching this for about a year, stuck in the $25-28 range, it has recently clawed its way back over $30 and stabilized here. My bet is that its getting ready to turtle its way up to the mid-$30s. Conglomerate value greater than the sum of its parts, under good management that's extremely motivated to be a saint for shareholders after its notorious fiasco that still shadows the company to this day, which I view as an extremely good thing. (Disc: I don't own TYC, but with extra funds, I would seriously consider owning this value pick as a longer-term hold.)

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Member Avatar htfdphil (37.65) Submitted: 11/29/2006 2:58:42 PM : Outperform Start Price: $42.03 TYC Score: +30.23

earnings

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Member Avatar peigler (62.27) Submitted: 11/12/2006 5:43:07 AM : Outperform Start Price: $41.17 TYC Score: +31.16

New management, looks like ge in younger years.

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Member Avatar gulbadan (75.44) Submitted: 10/25/2006 12:31:17 AM : Outperform Start Price: $40.72 TYC Score: +32.33

Strong comback , new team focused

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Member Avatar madgerman1 (91.76) Submitted: 10/17/2006 10:32:17 PM : Outperform Start Price: $41.31 TYC Score: +29.93

Tyco has excellent electronics, healthcare, and engineered products divisions

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Member Avatar donpaolino (50.67) Submitted: 10/17/2006 9:48:11 PM : Outperform Start Price: $41.31 TYC Score: +29.93

tyco had bad mgt but is inherently a good stock. it manufactures necessary items like steel pipe .rubber gloves and other things we can't do without.

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Member Avatar oldschoolpicker (47.53) Submitted: 10/11/2006 1:50:32 PM : Outperform Start Price: $39.66 TYC Score: +33.60

soft because of bad news... good products win in the end.

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Member Avatar chasking1 (39.03) Submitted: 10/5/2006 8:53:09 AM : Underperform Start Price: $39.17 TYC Score: -35.45

going down

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Member Avatar bucksbro (< 20) Submitted: 10/4/2006 7:28:59 PM : Outperform Start Price: $39.17 TYC Score: +35.45

Great product plenty of franchise potential

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Member Avatar Rocket063 (< 20) Submitted: 10/4/2006 11:12:07 AM : Outperform Start Price: $39.28 TYC Score: +33.94

Breakup into severl companies, bullish overall

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Member Avatar clintmccaskill (87.23) Submitted: 9/19/2006 12:25:11 AM : Outperform Start Price: $37.20 TYC Score: +40.64

Once they get over the scandal and people start to forget, people will think more about what the company does now than did then.

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Member Avatar roberrabbit (90.28) Submitted: 9/18/2006 9:03:48 AM : Outperform Start Price: $36.91 TYC Score: +41.52

believe they are in mid turnaround, capable of earning more, buying back stock and breakup will all help stock price

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Member Avatar motleytimber (95.35) Submitted: 8/24/2006 1:48:21 AM : Outperform Start Price: $36.74 TYC Score: +40.35

sorting out the mess.

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Member Avatar EVAhunter (< 20) Submitted: 8/18/2006 7:11:09 PM : Outperform Start Price: $36.99 TYC Score: +39.52

Tyco trades at <10x normalized FY2005 EBIT and there is much room for margin improvement from cost-cutting and growth (operating leverage). Market is undervaluing TYC based on recent underperformance, conglomerate discount and undercertainty of 1Q07 spin-offs of electronics and healthcare businesses. Sum of the parts valuation suggests TYC worth $37-$40. Electronics seems valued at $22.3BB (11.5x EV/EBIT). Healthcare appears valued at $33.5BB (14x EBIT). Engineered products carries a fair value of $7.4B (10.8x EV/EBIT). Fire & Security has a fair value of ~ $28.3BB (12.8x EV/EBIT). After removing ~$5.5BB in value for Corp Exp (assuming 12x '05), TYC carries an EV of ~$86bb. This implies equity value of ~$75.5bb (after $8.5BB in net debt) or about $37.50 per share. There are 3 catalysts to achieve target: 1) 1Q spin-off; 2) investor activism; and 3)Fire & Security div traction.

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