Tag Archives: TheStreet.com
Did Countrywide CEO lie on CNBC?
by Chris Roush
TheStreet.com media critic Marek Fuchs wants to know if Countrywide Financial CEO Angelo Mozilo lied during an interview on CNBC last week when he said the lender had stopped making loans to people who wouldn’t have qualified.
Fuchs asks the question because he received a mortgage solicitation from Countrywide that included generous terms designed to get someone who would probably not have received a loan during tighter times to apply.
Fuchs wrote, “Anyhow, I called Countrywide to get an explanation. I wanted to see precisely how many of the current loans are stated-income loans and how many are to people with lame credit scores. And I wondered whether that recent corporate line about finding religion when it came to lame loans is legit. And, well, I’m still waiting for a reply.
“Countrywide does not seem to be talking much these days. It is always a source of concern when a public company decides to have some quiet time. If I had a shiny nickel for all its ‘no comments’ lately, including a big one to The New York Times, which took a look into the crisis and were actually told that Countrywide spokesmen were too busy. I’m guessing they still are.
“When I tried to bridge this gap between company line and competing evidence, Ginny Zoraster, who works in the communications office, told me that she sent my inquiries on to four officials. She did that three separate times.”
Read more here.
Differing coverage of the Acer-Gateway deal
by Chris Roush
TheStreet.com’s Marek Fuchs writes Wednesday that the coverage of Acer’s proposed acquisition of Gateway was all over the map, from references to former Chinese leaders to former CEOs of other computer makers.
But The Wall Street Journal, wrote Fuchs, got it right.
Fuchs wrote, “They don’t indulge themselves with some lead that traces back 60 years or one, much worse, that throws wet kisses to the disgraced CEO of a company that wasn’t even involved.
“Instead, Jason Dean and Christopher Lawton take a step back and look at what the deal signifies for the PC market at large. In a dreadfully competitive market the world round, they say, the main thing is that size matters.
“‘The banding together of Taiwan-based personal-computer maker Acer Inc. and Gateway Inc. of the U.S. underlines how crucial scale is in the consolidating global personal-computer market, where margins are thin and competition is increasing,’ they say in their lead.”
Read more here.
Biz media could be harder on Countrywide CEO
by Chris Roush
TheStreet.com’s Marek Fuchs writes Friday that the business media has been a little too soft on home lender Countrywide CEO Angelo Mozilo.
Fuchs wrote, “But while Mozilo goes on his one-man campaign of self-interest, the business media need to do a better job of pointing out his long trail of inconsistencies. You, the savvy investor, need to be aware of the sort of contradictory things he has said and done in the past, lest you take too seriously the things he is saying and doing right now.
“How did CNBC’s Maria Bartiromo do Thursday? When the subject of Bank of America’s $2 billion investment came up, Maria’s first reaction was to go warm and fuzzy, to flash back decades to when Mozilo and Countrywide got their very first, bouncing baby of a loan … a $75,000 job.
“Said Bartiromo, about how things have come full circle so beautifully: ‘This on a personal level must be incredible for you, this relationship…’
“Aww. … I could have sworn I even saw Mozilo blanch just a slightly paler shade of orange with surprise.”
Read more here.
Wal-Mart, Home Depot stories ignore competitors
by Chris Roush
TheStreet.com’s Marek Fuchs writes that earnings stories on Wal-Mart and Home Depot where the economy and the weather are blamed for poor results ignore the fact that competitors Target and Lowe’s aren’t having the same issues.
Fuchs wrote, “Now let me show you how a whole mess of articles gets this important weighting wrong. Then we’ll see how The Wall Street Journal dances away with a coveted Business Press Maven ‘Nod of Approval’ for getting it right.
“Also, do tell me if you see the names Target or Lowe’s mentioned in any of these articles. I must have missed it in most, other than in The Associated Press. These companies are competitors of Wal-Mart and Home Depot and have been outperforming them for quite a while now. Even though it operates in the same economy, Target recently reported better-than-expected same-store sales. Don’t you think that should at least be set against claims that the consumer has completely clammed up?
“Apparently not. Soon after the company claimed that the consumer done it, Drudgereport.com ran with a banner headline: ‘Slowdown Hits Wal-Mart.’
“Don’t think it’s only the news aggregators. The trusted Financial Times ran with headline ‘Economic pressures’ hit Wal-Mart profit. Fully committing to the Wal-Mart and Home Depot corporate lines, the Financial Times compounded its error in the lead.”
Read more here.
TheStreet.com's Fuchs and Barron's Savitz in a tiff
by Chris Roush
Apparently Barron’s writer Eric Savitz didn’t take too kindly to TheStreet.com’s Marek Fuchs criticizing him for writing the same story about Microsoft stock over and over again.
Fuchs wrote, “He first said that my coverage was obnoxious. To this, I must say: I resemble that accusation. But beyond that, he only had one point I agreed with — and even that was pretty close to semantics.
“Savitz held my hand through Microsoft’s middling stock performance in a great market. He went over its revenue and profit growth and compared it with other software companies, all to prove to me that his call on Microsoft hadn’t been terrible.
“But his call was that Microsoft was a growth stock. That has been a bad one — and once again, my major criticism was not that he misled investors with his (so far, misguided) call but that he misled them by not letting them know it was the third time that he had been making the same precise call without being right. (He knew enough to do this in his second article, by the way, but dropped it by the third.)”
Biz media forget about Nardelli's problems at Home Depot
by Chris Roush
TheStreet.com’s Marek Fuchs writes that the coverage being bestowed upon new Chrysler CEO Robert Nardelli seems to be using revisionist history about his time as Home Depot’s CEO.
Fuchs wrote, “So how did the business media cover his appointment to lead Cerberus Capital Management’s Chrysler, one that many will be watching to gauge the ultimate fate of the troubled American auto industry? Well, to forgive these following sins, I’m going to need a spiritual implant.
“Forbes referred to Nardelli’s leading Home Depot through ‘a period of explosive growth, including expansion in Mexico and China.’
“Through a period of explosions, shareholders and store customers would probably accept as more accurate. But in this article, which was called somewhat prematurely Nardelli Makes Comeback With Chrysler (he has comeback in terms of resume filler, but if he runs Chrysler into a ditch like he did Home Depot, it won’t quite qualify as one), there is no mention of Home Depot’s stock price, store troubles or inability to capitalize on a boom every Lowe’s and their brother did.”
Read more here for other examples of bad coverage.
Barron's writer needs to stop with Microsoft story
by Chris Roush
TheStreet.com’s Marek Fuchs wants to know why Barron’s writer Eric Savitz has written the same Microsoft story about the company still being a growth stock three times in the past three years.
Fuchs wrote, “The Business Press Maven has a couple of concerns here. These articles appear written from the same template, without enough new information to merit such repetition, especially this latest one.
“Stop the presses! A company stated publicly that it was still relevant! It is overkill, boosterism. Microsoft has a public relations department that takes care of that; it does not need outside help.
“All articles in this collection (maybe I should market a collector’s edition) start by talking about how Microsoft is misunderstood by investors before going on to make faintly similar cases for why the stock is … c’mon, everyone together this time … a growth stock.
“In his most recent love letter to Microsoft, Savitz leads by saying that, while not many professional money managers seem to agree, ‘the nattering nabobs are dead wrong.’
“Last year, Savitz opened by talking not about nabobs, but for variation ‘the cynics’ who thought Microsoft would keep ‘shuffling along.’”
Read more here.
TheStreet.com posts better results, will relaunch in 2008
by Chris Roush
TheStreet.com reported Thursday higher revenues and profits for the second quarter of the year and announced it would unveil a redesigned business news web site in 2008.
A story on the web site stated, “For the quarter ended June 30, TheStreet.com reported record revenue of $14.9 million, up from $12.4 million for the second quarter of 2006. The company’s three revenue streams contributed to the increase, with advertising revenue up 48% over the prior year, while subscription revenue rose by 2% and other revenue, comprised 
primarily of syndication revenue, climbed 197%.
“TheStreet.com provides financial commentary, analysis, research, news and financial ratings, and is the publisher of this Web site.
“‘This quarter further positioned TheStreet.com as a leader in the creation and distribution of a broadening category of financial content,’ said Thomas J. Clarke Jr., chairman and chief executive officer of TheStreet.com. ‘Looking forward our customers and advertisers can expect to see ongoing innovations at Stockpickr.com and TheStreet.com Ratings, the continued evolution of our multimedia offerings, and the relaunch of a completely redesigned TheStreet.com Web site in early 2008. All of these content initiatives reflect our commitment to create additional premium advertising inventory and sponsorship opportunities.’”
Read more here.Â
Business press suckered in sequential reporting on earnings
by Chris Roush
TheStreet.com media critic Marek Fuchs writes that some companies are asking business reporters to cover their earnings sequentially and not year-over-year, and some are being suckered into the tactic.
Fuchs wrote, “Texas Instruments reported after the close on Monday. And then there’s the press release. The first two bullet points, coming right after the headline, and in bold no less, are about how revenues and earnings were up … sequentially.
“Sequential. Sequential. Sequential.
“Texas Instruments is really pressing the sequential point here. In the second sentence of the body of the press release, we hear about those revenues again — up 7% compared to the ‘prior quarter.’
“Of course, we are soon reading a mention about how, compared to the same quarter last year (the second), revenues were down. And this, of course, is all The Business Press Maven cares about. Each quarter, you see, has its own characteristics — its own seasonal issues and the like — which is why it is generally accepted practice to make year-over-year comparisons.
“Sequential comparisons are for those who want to avoid the more telling one.”
Read more here. Fuchs notes that the Financial Times dutifully reported the earnings sequentially.
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Cutting the price is good news, right?
by Chris Roush
TheStreet.com’s Marek Fuchs rips the business press to shreds for taking Apple’s word that cutting the price of the iPhone by $200 was actually a good thing.
“To CNBC, it was a “bold move,” while Forbes actually wrote that investors, who reacted (unlike the business media) with bitter disappointment to the surprise price cut but had pushed the stock up ahead of the top secret announcement, were buying on the rumor but selling on the news.
“Uh, there was no rumor of a notably gruesome price cut. That would not have made the stock fly in the days before what was billed as a ‘special event.’ True, a tweak of the iPod line was announced, but it looks much like the iPhone, and that prompts me to ask: Will the unique look of the iPhone, a major selling point, be lost?
“Investor’s Business Daily highlights the thoughts — and I use that term lightly — of an analyst who essentially says: This was the plan all along, to take an ax to the price by a factor of a third. Uh, dude, if it was the plan all along, they sure didn’t account for the rebellion of the loyal Apple customers who waited in line for the higher-priced iPhone weeks back. Jobs had to rush out an apology and store credit to those suckers.”
Read more here.