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Kansas City Southern Message Board

  • mhirschey mhirschey Jun 27, 2000 10:39 AM Flag

    Morningstar Ignorance


    In a series of recent
    misinformation pieces, Morningstar's financial journalists have
    managed to so confuse the KSU/Stilwell/Janus issue that
    their readers are apt to become as confused as they

    Due to a complete lack of understanding, they cannot
    grasp that:

    1. Post-split, the same people own
    Janus as pre-split. Even their percentage ownership is
    the same.

    2. Janus Capital Corp., manager of
    the Janus funds, is 80% owned by shareholders of
    Stilwell. Shareholders in Stilwell own these shares, and
    control those votes.

    3. Janus fund shareholders do
    not own Janus Capital Corp. Changes in the ownership
    of Janus Capital have no impact on Janus funds so
    long as any such change does not cause an adverse
    change in the ability of Janus funds to retain top fund
    management talent.

    Any Morningstar suggestions that
    Janus fund shareholders might wage a proxy fight for
    control of Janus Capital reflect a complete lack of
    understanding of points 1-3.

    After looking at the few
    most recent vitrolic Morningstar "reports" on
    Stilwell, I have a couple of questions of my own:

    Why does Morningstar employ so many ignorant
    financial journalists?

    2. Why are the ignornant
    Morningstar financial journalists so angry about matters that
    they clearly do not understand? (Being fat, dumb and
    happy is always better than starving, dumb and

    Best wishes,
    Mark Hirschey
    Professor of Finance
    Stockton Research fellow
    University of

    PS: I'm a big fan of KSU management, big shareholder
    too. I'm also very happy.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Mr. Hirschey./Professer/ Sir,

      It is you
      that I have been wanting to talk to. Maybe you, with
      your vastly informed and accomplished brain, can
      answer some of my questions about the Janus vs. Stilwell
      "problem", since I know nothing about "it" other than
      reading the articles by Morningstar and CBS marketwatch,
      and some various posts.

      How will I, as a
      Janus Mutual Fund shareholder, be directly affected
      (Finacially) from the Stilwell spinoff? Will Janus management
      quit, will Stilwell change the way Janus does things.
      It seems to me that no one can possibly know until
      the spinoff is done and the managers leave or stay.
      Why would Janus management threaten to quit over a
      silly name change.(Stilwell is a funny name isn't it)
      Does it not seem smarter to you, to keep things as
      they are i.e. if it ain't broke don't fix it. I assume
      that if you had your money in Janus Funds rather than
      KSU stock you would questioning KSU management also,
      but hey we all know for sure that Stilwell will still
      bring in big profits for KSU shareholders no matter who
      is running the Janus funds right! One fund manger is
      the same as another, right? Berger sure as hell kept
      up those great profits?!

      Do we know for sure
      that the fund managers at Janus are "bought"? In the
      end, we can ALL only hope and pray that the current
      fund mangers at Janus, will not leave, and that
      Stilwell will let them run things as they have. Janus
      should just be left alone to do their money magic as
      they have done for all of us for so long. I hope
      Stilwell is all only a name change.

      Long live Janus
      and my retirement,
      Ryan S. Wynder
      24 year old
      Sous Chef at a restaurant in Sunny Florida. My step
      father has his D.V.M. from KSU, that means I am only
      half biased!

      • 2 Replies to ryanwynder
      • > How will I, as a Janus Mutual Fund
        shareholder, be directly affected (Fina[n]cially) from the
        Stilwell spinoff? < Not at all that I know of. Why
        should you be ? You have bought a mutual fund product.
        Your financial interests are affected by the Stock
        Market performance of the individual stocks in that
        fund. The spinoff to benefit KSU shareholders has no
        effect on that. In the future your financial interests
        will _also_ be affected by decisions made by your
        Janus fund manager to add/delete individual stocks from
        your fund. > Will Janus [fund managers] quit? <
        Depends on Janus _TOP_ management I would think. As
        always they will weed out marginal performers and reward
        superior performers and encourage them to stay. Why would
        this change? Janus is a company with its own
        management, own Board of Directors, its own compensation
        policies; this has not changed. > Will Stilwell change
        the way Janus does things? < Stilwell, formerly a
        subsidiary of KSU (and prior to a couple of years ago called
        "FAM"), has owned Janus for close to 20 years. The same
        Stilwell top management that has run the shop for most if
        not all of that time is still running the shop today.
        Their policy has always been that the companies they
        own are autonomous as long as they perform. Why would
        that successful strategy change? > Why would Janus
        management threaten to quit over a silly name change? < A
        lot of people make money in a transaction like a
        spinoff. Banks, Lawyers, consultants, top management.
        Bonuses, fees; it's like a trip to Disney World for the
        Rich & Avaricious. Some Janus people may have felt
        they weren't getting enough of the action; they were
        paid more. The issue has died down except for a couple
        of clueless reporters sniffing around the edges.
        > Does it not seem smarter to you, to keep things
        as they are i.e. if it ain't broke don't fix it?
        < Always a good idea. Trouble was, it WAS broke.
        Stilwell (formerly FAM) has always been tied to a
        railroad. In the old days this was regarded as "protection"
        for the smaller Stilwell. As Stilwell (FAM) has
        prospered and the railroad has not, it was time to jetison
        the railroad (which its advocates think has wonderful
        potential on its own and will blossom). That spinoff of the
        railroad is EXACTLY what has happened, accomplished in a
        very clever way that achieves enormous tax advatages
        to the benefit of KSU shareholders. Hooray for us.
        > Janus should just be left alone to do their money
        magic as they have done for all of us for so long. <
        Wise words.

      • Yahooligans:

        Your mother loves you. She
        wants good things for you. She showers you with love
        and affection.

        I hope you love your mother. I
        hope you show your love to your mother in many little
        ways. Stop reading this and call her right now "just to
        "say I love you.".

        I'm not your

        We've never met.

        And who gives a damn when (or
        if) I shower?

        I'm just trying to gather
        valuable insight about the valuation of KSU from
        anonmyous, biased sources, like you. That's tough. I will
        have to sort out that part of what you post which is
        biased, baloney, or just plain biased baloney.

        example, you might THINK I am a finance professor at the
        University of Kansas. Do you know that?

        There is a
        Mark Hirschey, Professor of Finance and Stockton
        Research Fellow at the University of Kansas (check it out
        on the Web

        However, how do you know that I am that

        Moreover, even if I am, who cares?

        Does that guy
        ever get it right? And if he does, why would he give
        it away?

        What part of what mhirschey posts is
        biased, baloney or just plain biased

        IMHO, all of what I post is biased. (I LOVE this
        stock.) A cynic might say that I want you to buy KSU
        right now and make its price go up a lot! That cynic
        would be right.

        Whoa, before you e-mail the SEC
        enforcement staff, round up the police, and get the dog
        catcher involved, be sure that I'm not pulling your leg a
        bit in the paragraph just above. Again, how would you

        Truthfully (again, who knows?), I believe:

        1. Nothing
        I say here can move KSU. I am no Tom or David

        2. KSU is run by smart, shareholder motivated
        management. They will do nothing to harm the Janus Capital,
        Inc. franchise. They have nurtured this baby, and will
        ensure that it grows, and grows, and grows. They will
        maximize shareholder value.

        3. The
        Stilwell/railroad split up is a great first step in this
        restructuring process. (Why do you think they called it
        Stilwell Financial, and not Janus Capital?)

        Janus funds are run by extremely capable management
        that has done exceedingly well in a robust investment
        environment for growth stocks. They will continue to do well
        in a market environment that I expect will be a bit
        rougher for growth stock investors.

        5. Sometimes,
        I will be able to decipher bias from baloney.
        Sometimes, I won't.

        From Asolo, Italy, I

        Best wishes,
        Mark Hirschey

    • Your insights are right on target. Both of the
      Morningstar "writers" can be emailed (addresses listed at the
      end of their "articles"). Given your grasp of the might be worthwhile to respond to them directly.
      Uninformed journalism should not go unchallenged. Thanks.

    • mhirchey,
      You put these so called "financial journalists" back in their misinformed place. They have no clue !

      KSU is a GREAT stock.

      Long time shareholder,


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