Tuesday, January 20, 2009

JNJ When Did It Disclose?

Johnson & Johnson (JNJ) laid out its Q4 and full year earnings. Investors were disappointed to realize that they were being guided down. Why investors still hold to delusional hopes is beyond me, but the JNJ balloon popped today. The problem I have with JNJ is the contrast between the press release and the conference call.

The press release crossed the wire at approximately 07:45 ET. The conference call was scheduled to start at 08:30 and was to run to approximately 10:00. Half an hour in market trading. When you line up the press release and the conference call transcript the conference call has deeper and richer disclosure and is infinitely more valuable than the press release. Even before you get into the Q&A. The level of disclosure and detail is superior in the press release.

By the time you finish reading the conference call transcript you have no further use for the press release. This brings up an interesting Reg FD dilemma. At the end of the day JNJ can say they have disclosed. But at the end of the day the press release which becomes a statutory document becomes useless. The conference call replay may disappear and investors may not know where to get the transcript.

This is not a level playing field.