Wednesday, April 07, 2010

Monsanto Disappoints; Hugh Grant Still Confident

Monsanto (MON) issued a slippery press release but the market still managed to be rightfully disappointed. The short term results were disappointing. Monsanto came out with long term promises of earnings growth in mid teens. A bird in hand is worth two in bush.

The press release was crafted in the third person making it easy for media to cut and paste. Guess which comments were easy to lift. A press release is a REG FD process. The press release utilized this line to help manage perceptions “As part of its earnings results for the quarter ending Feb. 28, 2010, the company discussed performance against projections in both the seeds and traits and agricultural productivity segments during a year of intense competitive pressure for both sides of the business.”

Excuse me the press release is supposed to provide information. The comment that they have discussed something relevant to shareholders is not disclosure. But not to worry; Hugh Grant, chairman, president and CEO for Monsanto offered up this quote for shareholder encouragement “...I am confident that we're a growth company going forward."

Something is wrong with the business plan and previous guidance is fallen apart. What to fix? Well maybe Hugh Grant should not be Chairman and President and CEO. That’s a lot of work Hugh. Besides Hugh you may need someone to blame. Right now you are a little bit naked.

Disclosure: No position in this stock