The Ins And Outs Of Cash Flow

These reports offer clues about companies' health

When Motorola announced on Oct. 11 that its earnings and sales would fall short of Wall Street's expectations for late 2000 and 2001, the stock plunged 19%. Investors caught in the sell-off had only themselves to blame. The statement of cash flows Motorola published on July 31 showed inventories rising much faster than sales--an imbalance that often points to softening demand for a company's products.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.