Thursday, April 27, 2006

ExxonMobil High Oil No Dividend Increase

Today ExxonMobil reports a 7% net income increase for Q1 2006 over 2005. EPS was up an impressive 14%. But yesterday's declared dividend remains unchanged. Chairman Rex W. Tillerson remarks that US$7 Billion was returned to shareholders of which only US$2 Billion was by dividend. Also the share repurchase program will be increased by another US$1 Billion. By not increasing the dividend and relying so heavily on share repurchase the company is betting against today's market price in favor of tomorrow's oil/share price. The bias favors capital gains against increasing dividend income. Subtle with many ramifications depending on your investment objectives/requirements.

Wednesday, April 26, 2006

Asensio Disagrees with SEC Chairman

Chairman Cox in testimony before Senate Banking Committee seems to have shown his hand in favor of regulations requiring short sellers to delver the underlying security. Chairman Cox maintains that it would assist in maintaining orderly markets. Asensio disagrees and takes an opposing view arguing against the requirement to deliver underlying shares. Some will say this creates a "might is right bias" Reader comments please?

Align Technology Tortured Loss Explanation

Align Technology (Nasdaq:ALGN) lost money in Q1 2006. The press release does not deal with the loss until you are well into the text. CEO and president Thomas Prescott is attributed some very convoluted language about product mix within the press release. He also claims in his remarks that revenue and volume growth are critical. The press release clearly states revenues are down. Are they really switched on in this shop? Or are they blowing smoke?

Tuesday, April 25, 2006

Wrigley's Candy Coating

Wrigley's (NYSE:WWY) experiences lower profits yet announces record sales. Financial Spin from the candy coating specialists. The results where actually not that bad and had good explainations. But the company elected to whistle through what they thought was a grave yard. Everyone is reporting new costs for expensing stock options and there was the impact of previously announced restructuring charges. But continue reading the entire release and hidden in the verbiage is an explaination of shrinking margins as low margin products surge in popularity. They want it to sound like good news but its fraught with angst. Some straight talk would be appreciated and probably respected within the market.

Avid Technologies Corporate Noise Machine

Avid Technologies (Nasdaq:AVID) issued thirteen (13) press releases over the weekend touting new products and enhancements. I must confess to not reading them all. Even in the world of marketing communication where hyperbole rules this level of over-exuberance kills message(s) and does not enhance shareholder valuation.

Monday, April 24, 2006

Weekend Follies April 22-23, 2006

Weekend follies attempts to expose companies which issue substantive press releases at odd-ball hours over the weekend when no one is looking. This weeks culprits number three. Washington Mutual (NYSE:WM) and Commercial Capital Bancorp (Nasdaq:CCBI) announced mergers with each other. The third was Avid Technologies (NASDAQ:AVID) which will have a special post of its own.