Posts by Michael Santoli

  • Coke, McDonald's and IBM are not safe. No company's too big to assail

    Michael Santoli at Yahoo Finance9 days ago

    In the past two days, three companies comprising one-tenth of the Dow Jones Industrial Average have been run through a cycle of disappointment, blame-casting and pining for a tough-love savior.

    This is the market we inhabit now:

    -A corporate titan with a venerated old American brand reports lousy results first thing in the morning.

    -Wall Street awakens to the fact the businesses have been stagnant for years, the stocks kept afloat by financial maneuvers and halfhearted cost-cutting programs. The share price is hammered before the opening bell.

    -Commentators tut-tut about the decline of stalwart brands in a fast-changing culture, or the squandering by poor CEOs of so much accumulated customer loyalty.

    -Before noon, investors start asking whether an activist investor is marshaling his resources and a sense of righteous capitalist outrage to make a run at shaking up these cozy blue-chip companies.

    Yesterday it was International Business Machines Corp. (IBM), falling far short on revenue and profit forecasts while paying another company $1.5 billion to take its chip-manufacturing business off its hands.

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