Tag Archives: Company Coverage
Trading stocks based on biz news
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Reuters has begun selling a service that allows people to buy and sell stocks based on news events, according to a New York Times story.
Jeremy Peters wrote, “They will give subscribers the ability to mine past and present Reuters news articles in real time and automatically buy, sell or hold a stock based on market-moving events.
“The mining and sifting of news take place in computers dedicated to algorithmic trading; that is, automatic buying and selling based on complex mathematical formulas that aim to pick the optimal time to trade a stock.
“Although algorithmic trading on news events already exists, Reuters says its system is the most advanced. ‘;If an event breaks somewhere in the world, you want to be able to respond to that, or manage the event risks,’ said Richard W. Brown, business manager for Reuters NewsScope, as the new program is being called. ‘At a very simplistic level it’s about speed.’”
Read more here. Business journalists can now say that they do move the market.Â
Barron's and Pfizer: A lethal combination
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TheStreet.com’s Marek Fuchs takes a look at Barron’s coverage of the recent news out of Pifzer, which included the halting of one of its major new drugs due to people dying during the trials, and comes away less than satisifed with the story.
Fuchs wrote, “Considering how many people died in the torcetrapib trials, I found the lead almost comically tasteless: ‘Patients and their doctors weren’t the only ones left heartbroken this weekend … investors, too.’
“But, hey, we’re talking business tactics here, not taste, so I was willing to give Barron’s a one-time pass, especially after getting caught up in the excitement of this next line: ‘Yet investors have a chance to turn Pfizer’s flop into a hit for their portfolios.’
“Do tell, do tell! And that, unfortunately, is where Barron’s told. ‘Investors with a little patience may embrace Pfizer as a value play, assuming the company accelerates cost cuts, hikes its dividend and [my emphasis] cuts more deals with other drug makers to fill the gap in its pipeline created by torcetrapib’s demise.’
“Let’s graciously overlook the fact that it is not always so easy to cut thousands of jobs while you are simultaneously hiking a dividend beyond tomorrow. There is something almost magical about the uselessness of the following line, that all they have to do is make some deals to make up for torcetrapib. Oh, is that all?”
Later, he wrote, “That’s a little like telling a young man that all he needs to do to live a happy life is partner with a good-tempered, supremely attractive and brilliant person, and make a lot of money in a field that he loves that also allows him to take Fridays off. Really, that’s all.”
Read more here.
Former Sun CEO shoots back at USA Today reporter
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Former Sun Microsystems CEO Scott McNealy didn’t like the column that USA Today tech reporter Kevin Maney wrote about him earlier this week, so he replied with a sentence-by-sentence rebuttal that Maney posted on his blog.
Maney wrote, “Scott wasn’t all that happy with the column. Some of his comments the he emailed me this afternoon. What I wrote in the column is in quotes; his response in italics:
“McNealy could have become bitter. Among his peers at the most elite level of the tech industry, McNealy is the one who felt pressure to leave.”
Quite the opposite.
“Sun’s stock has languished at less than one-third its price in January 2002. Wall Street blamed McNealy for resisting layoffs and taking too long to embrace new technologies. The day McNealy stepped aside for Schwartz in April, Sun’s stock rose 9%.”
We announced huge growth that day at our earnings call. Stock plunged soon thereafter.
“Such passions seem a lot more productive than one that used to consume McNealy: fighting Microsoft.”
I was consumed creating a F200 company that has added enormous value to many folks.
“It’s just one of Silicon Valley’s Hall of Famers enjoying life again.”
I have enjoyed my life at every stage.
Read more here.
Some companies cutting back on WSJ advertising
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Technology and automotive industry spending on advertising in the Wall Street Journal is expected to slow in 2007, according to a Bloomberg story that looks at newspaper ad trends.
The story stated, “At Dow Jones, technology ad spending will remain weak while automotive ads will slow next year, said Gordon Crovitz, an executive vice president and Wall Street Journal publisher.”
Later, the story noted, “Crovitz, speaking at the Credit Suisse media investment conference in New York, said computer makers International Business Machines Corp. and Dell Inc. cut back on advertising in the Wall Street Journal this year. Technology ads will continue to weaken in 2007, while financial advertising will strengthen.
“With the acquisition of the Factiva news database, 40 percent of Dow Jones’s revenue will come from digital properties, Chief Executive Officer Richard Zannino said at the UBS conference. He said that amount will exceed 50 percent in 2009.”
Read more here.
Yahoo issues release early due to WSJ
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Tom Foremski of Silicon Valley Watcher wrote on his web site that the reason that Yahoo put out its press release at 5:34 p.m. Pacific Time on Tuesday was because it had heard that the Wall Street Journal was going with its version of the management changes.
Foremski wrote, “Yahoo prereleased it because the Wall Street Journal said it would go live with the story. The Wall Street Journal had been prepped by sources and agreed to publish the reorganization story in Wednesday’s newspaper. But it wanted an interview with Terry Semel, Yahoo CEO, which he kept missing Tuesday afternoon.
“WSJ editors grew increasingly concerned with no show from Terry Semel. They worried that Yahoo might be pre-briefing the rest of the universe and it might lose pole position on the story, so the Wall Street Journal told Yahoo it would go with what it had and publish the story online. Which prompted Yahoo to try to scoop the Wall Street Journal and get its version out first.
“All I can say is that things have gotten very strange at Yahoo this year. This reorg is needed but the one that’s needed is at the very top, IMHO.”
Read more here.
Fuchs: Media cover Yahoo shakeup with reserve
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TheStreet.com’s Marek Fuchs noted that many business journalists will fall all over themselves when a female company executive appears to be headed to the top of the corporate ladder.
But in the case of the recent management shakeup at Yahoo, the coverage was reserved.
Fuchs wrote, “The Business Press Maven believes the business media do a special disservice to investors when they get too excited about a management change or single prominent person entering a business’ picture, even when that business is as purportedly cutting-edge as satellite radio and the person is the renowned Fartman.
“As a basic writing method, personality-driven journalism works well. It is very readable. But from an investor’s perspective, it holds good thought captive to cult-of-personality nonsense.
“It takes a long time for any single person or management to improve a business, if they ever can. But there is probably nothing that loses the average investor more money than chasing after the sort of stock-price pops that come from excited white-knight coverage like what we saw when Howard Stern came to Sirius late last year.
“Fortunately in this case, though, Yahoo! is putting different people in prominent spots, and coverage has been appropriately muted. This is probably because the move involves a less-than-sexy bureaucratic shuffle of departments — and the head Fred remains the same.”
Read more here.Â
Seattle biz media missed downfall of mortgage company
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Michael van Baker, writing on the Seattlest.com web site, noted that most of the Seattle business media missed noticing the problems that led to the failure of an Eastside mortgage company. The Seattle Times business reporter Elizabeth Rhodes had the story this weekend.
Van Baker wrote, “We note that the local business media never saw it coming, due to the proximity of their lips with the company’s ass.
“To the Puget Sound Business Journal, Merit’s founder Scott Greenlaw was ‘an up-and-coming businessman,’ the Times points out. In 2004 Washington CEO magazine proclaimed Merit one of the best firms in the state to work for, and the next year, the PSBJ named Merit a finalist for its Eastside Business of the Year award. Greenlaw made the sports section of the Seattle Times for a profile of a young go-getter who made good.
“We’re not mortgage geeks, but trust us, this whole story makes for gripping reading. Okay, don’t trust us. How about this: ‘Some wonder if the company’s demise hinged on its practice of hiring jocks and stunning but inexperienced young loan officers and managing them loosely.’”
Read more here.
Good biz journalism = good investment?
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Forbes.com columnist Gary Weiss noted on his blog Sunday that Houston Chronicle business columnist Loren Steffy had a thought-provoking column on Friday about the New York Times Co.’s two-tiered stock structure.
In short, Steffy wrote that if the Times didn’t want the money from investors, it should have never gone public. Former Times’ ombudsman Daniel Okrent has criticized the column, as has others, Steffy noted on his blog.
And Weiss makes an interesting point as well. He wrote, “What makes this whole issue fascinating is that it deals with something we in journalism don’t like to talk about, which is that good journalism is not necessarily a good investment, and vice versa.
“Yes, it seems the Times was trying to insulate its management from investors. Steffy points out that “if the Times, or any news organization, didn’t want to answer to investors, then it shouldn’t have sought the public’s investment.’
“Well, he’s got a point there. Public companies have an obligation to their shareholders to maiximize their return on investment, but that has a nasty way of conflicting with their obligations to provide readers with the best possible newspaper.”
Read more here.
Pfizer plays biz media like a fiddle
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TheStreet.com’s Marek Fuchs noted that drug company Pfizer’s public relations strategy in the past week should be used as a case study because of the way it manipulated the business press.
On Tuesday, the company announced that it was cutting 2,000 salespeople, or about 20 percent of its sales force. Its sales force had been considered its strength.
Fuchs wrote, “Then Thursday rolled around. Pfizer cleverly invited analysts and investors to its research facilities in Groton, Conn., and sang (at top volume) the praises of the drugs in their pipeline. It also raised estimates a tad, but without meaningful higher revenue growth — that’s no big deal long term, so let’s ignore that.
“Pfizer, a true blue pipeline? Speaking of blue, this is a company whose last big bang came with the rise of Viagra, about eight years ago.
“Nevertheless, chief executive Jeffrey Kindler prattled on and was quoted widely about ‘significant scientific breakthroughs’ and how the company was ‘hungry for more.’
“Well, hunger and a quarter won’t shine your shoes, but who am I to quibble? It is extraordinarily hard to predict what is going on with FDA approval on any given Thursday, but the business media was not so cautious. This was a company that said it was ‘hungry.’
“A string of laudatory articles followed Thursday’s meeting, including one from Forbes titled ‘Six Pfizer Drugs to Watch’ about ‘intriguing’ drugs that ‘bear watching’ and another from Forbes titled: ‘Pfizer Fights Back.’”
Read more here.
Barron's editor: Should Yahoo buy Dow Jones?
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Eric Savitz, the West Coast editor of Barron’s, which is owned by Dow Jones, suggested on his Tech Trader Daily blog that no one would complain at his shop if Internet company Yahoo should consider making a bid for his parent company.
Meckler replied back by stating, “Mr. Tech Dirt is clueless. First of all WSJ.com has over 700,000 paid subscribers to The Wall Street Journal. Name another property online that has such a significant motherlode of valuable subscribers that are paying real money for content? It also has lots of other valuable Internet real estate. And finally, the WSJ franchise has lots of assets that can still be unlocked online not to mention the fact that the so-called ‘low growth business’ which includes The Wall Street Journal print edition is solid gold as a print property and likely to be the last newspaper standing 50 years out.”
Savitz ended the post by stating, “As a Dow Jones shareholder, and someone who has put in close to 20 years working here, let me just say, I think no one around here would complain if Yahoo made a bid at a very large premium. I’d also point out that Dow Jones has a market cap of just $3 billion; Yahoo has a market cap of close to $36 billion. If YouTube, with basically no revenue, was worth $1.65 billion, what do you pay for the leading paid subscription site on the Web?
“And, of course, as a bonus, you’d get this blog.”
Read more here. Dec 12 UPDATE: Savitz now says he had his tongue “planted firmly in cheek.”