SUCCESSFUL INVESTING: Tyco rates a 'buy' under new leader

Q. Despite its many troubles, I'm still hopeful that TycoInternational could emerge a winner. What's the outlook for thestock? -R.B., via the Internet

A. No one is more hopeful about the prospects for that troubledinternational conglomerate than its new chief executive officer.

Edward Breen, who collected a $3.5 million signing bonus to leavehis job as president of Motorola Inc., could receive tens of millionsof dollars more if he succeeds in accomplishing a turnaround at TycoInternational (TYC).

Shares of this firm that makes products ranging from diapers toADT burglar alarms are down 79 percent in value this year, followinglast year's 6 percent gain.

The no-nonsense Breen replaced Dennis Kozlowski, who resigned hispost just before an indictment on criminal charges of avoiding salestaxes on artwork purchases. Kozlowski, one of America's most richlypaid CEOs, reportedly received $135 million in interest-free orforgiven loans and other payments from the company over five years.

Breen has wasted no time in cleaning house.

The company's chief financial officer and interim general counselwere on their way out shortly after his arrival. With Tyco'saccounting practices long criticized and a Securities and ExchangeCommission probe underway, Breen also widened management's owncompany-wide investigation beyond the dealings of Kozlowski.

On a positive note, Tyco recently spun off its financial servicesbusiness, bringing considerable cash to meet its near-term liquidityneeds.

The consensus rating on these depressed Tyco shares is a "buy,"according to the Boston-based First Call research firm. That consistsof four "strong buys," eight "buys" and one "hold."

Leckey answers questions only through the column. Addressinquiries to Andrew Leckey, P.M.B. 184, 369-B Third St., San Rafael,CA 94901-3581 or by e-mail at an drewinv@aol.com.