Friday, September 18, 2009

Manulife Bitch Slaps Sun Life

Sun Life (SLF) pledges to keep dividend according to Dean O’Connor, Sun Life President. Manulife (MFC) promptly bitch slaps him when their CEO Donald Guloien declares that it’s unwise for high ratio dividends in financial services. Too much Jerry Springer not enough CEO coming from that exchange.

Manulife shocked its investors and broke their trust. Sun Life is saying they will not break that trust. Battling for shareholder loyalty is the stealth battle which will affect perceptions for a decade into the future.

Palm Rubinsteins Trifecta?

Palm (Palm) continued with the controversy. Lots of buzz about the Pre. The Pixie reminds me of the old IBM Peanut. They have started again with the guidance which is secret code that management thinks things will be better soon.

But the most interesting management tell was this comment in the conference call transcripts attributable to Jonathan J. Rubinstein Chairman of the Board and CEO:

“We successfully launched a technological trifecta that was years in the making.”

The Chairman and CEO is actually using gambling terminology to describe their business plan. I know technology is a risk but give me a break. Did we really see inside this guy’s head and find a casino?

Thursday, September 17, 2009

Marcus Corporation Poor Disclosure

The Marcus Corporation (MCS) disappointed investors and the stock sold off. They have a confusing mix of movie theatres, restaurants and hotels. The theatres are driven by block buster movies over which they have no control. The hotel business is not doing well. Surprise surprise. A new restaurant format they say is encouraging. This is a real estate play in disguise but they report financials as an operating business. The earnings release did not include a sources and uses of funds. They carry a lot of long term debt. Current maturities are well in excess of cash positions.

Clearly management does not want to explain itself. Therefore what conclusion can we arrive at.

Wednesday, September 16, 2009

Adobe "Snack du Jour"

Adobe (ADBE) makes a big fat offer for Omniture (OMTR). Adobe stock drops and Omniture climbs smartly. Adobe has been acquiring to keep its competitive position. Omniture is the “snack du jour”. Given that Adobe must acquire its very interesting to follow insider trading for the past two months or so. Surely these officers understood that a particular take over was contemplated. Surely these officers understood that Adobe stock would drop. Surely these officers still profited from insights not available in the open market place.

The list is an impressive one

Robert Tarkoff SVP Business Productivity Solutions
John Warnock Chairman of Board
Karen Cottle Counsel
Charles Gescheke Chairman of Board
Kevin Lynch SVP Chief Technology Officer

By the way they all sold.

Obama Health Insurance Stealth Consequence

Everyone complains about the cost of insurance. Employers face crippling costs. So you have to ask yourself. If two individuals apply for the same job and have comparable qualifications. One will enroll in the company insurance plan and create costs. The other guy has his own public option and does not need the expensive company plan. Financially which is the better hire.

Tuesday, September 15, 2009

Best Buy Needs Better Segment Reports

Best Buy (BBY) posted decent Q2 results. The stock sold off as did most of its comparables. Best Buy is reporting by region and product category. Given that Best Buy is such a global giant and retail spending is driven by many local issues such as employment and payroll we could use some more segmented reporting. Macro statements such as Europe is up or down do not really provide sufficient insight into a sophisticated operation such as Best Buy.

Monday, September 14, 2009

Obama Reforms Challenge Financial News

President Obama just announced from Federal Hall in lower Manhattan that a new agency will be created to regulate "Consumer Financial Protection". The government needs to get into the caveat emptor business and many will welcome this move. Many details need to be developed; here is a scenario that may affect the earnings of Google (GOOG), Yahoo (YHOO) and Microsoft (MSFT).

The financial ad business seems to be lightly regulated.On line investors are frequently bombarded with word ads promising huge returns which are clearly not plausible. Offers of 450% returns if not more are served by search engine algorithms to probable investors. Search engines do only cursory reviews of the offerings and are really not protecting the public.

If as and when the new agency rides into town and starts regulating how much revenue will disappear.

Tenet Lets Cat Out Of The Bag

Tenet Health Care (THC) popped its stock some 8% by announcing investor positive changes to its guidance. Q3 is coming in better than expected. Q3 is usually slow and this time it was not as bad as previously thought. The problem I have is the extent to which Tenet is explaining its changes in guidance. The share is very low and abets volatility. The louder you beat the drum of investor relations that better the stock performs. The quarter is almost over so the sneak peak guidance change challenges the concept of Fair Disclosure.

Sunday, September 13, 2009

GM Selling Credibility Not Cars

General Motors (GMGMK.PNKS) has launched a barrage of new ads. I know because they interrupted some of the NFL football games I was watching.

According to Bob Lutz GM Vice chairman

“This is a big bet on the power of communication and effective advertising in changing public perception,"

The Ad’s under the tagline “May the best car win” feature the new Chairman Ed Whitacre, a former telecommunications executive who took his post when GM emerged from a government-sponsored bankruptcy in July. Basically you can return the car within 60 days and you have to have driven less than 4,000 miles. They also remind you that the power train warranty is 160,000 miles.

At the same time they are re-instated salary cuts to much of their management team. Hmmm there go the costs again. The return policy is easily matched so it will not be a competitive advantage for very long.

Car guy’s say it’s about the cars not the gimmicks. What about the cars. That’s what people want to buy. B y the way that ad for Cadillac with multi stage launches racing across the desert flats did not impress me. Crowded messages. But that’s just me.