In his letter, Icahn points to a dysfunctional corporate America as the lifeblood of his strategy. He says, “true corporate democracy does not exist in America and as a result many unfit CEOs are not held accountable.” Icahn credits his success to “adhering to the activism model which we have spent many years developing. What we essentially do is attempt to hold managements accountable through our rights as shareholders and seek to ensure the right people run the companies we invest in.”
In short, there will always be the opportunity to step in and shake up management, remove bad CEO’s, replace them with good CEO’s, and unlock value in poorly performing companies. Until every company in America is optimally run and is maximizing shareholder value, Icahn will be in business, and so will the art of shareholder activism.
Perhaps the biggest nugget in Icahn’s letter was his analysis on the power of the board seat. Over the past five years, if any investor would have bought an Icahn-owned stock the day that he (or his team) joined the board of the company, and sold it the day they left the board, according to Icahn’s study that investor would have made a 27% annualized return. That means Icahn’s “board seat screen” would have turned $30,000 into just over $100,000. Moreover, these stocks were winners nearly 8 out of every 10 times, when this condition of a board seat was met.
Apparently he never even considered buying any shares in ALOT, or the percentage return would have been much greater. We must make Management Accountable through our rights as shareholders, and ensure that the best people run those companies.
Well stated Carl...
Sentiment: Strong Sell
Too funny, the people who bought into this entire business model. All of the weight loss stocks are scams and continue to be shorted into oblivion. One of the tip-offs was the Vivus management, all selling their shares ASAP and getting over $30 at the time. 38 total employees, all being lawyers with zero scientists or R&D guys.
ARNA was mauled by hedge funds who took great license in selling it relentlessly, whether legitimate or naked, it didn't matter to them. Then this one comes along with another "blend" of two old generics that were invented before aspirin, and actually selling the concept to the unsuspecting public. Hammer away guys, they'll keep coming back to buy more!
Every time I attempt to short, I get a rejection of order telling me that there are no shares available to short. It's been happening for the last 3 days. How can any retail short GTAT if this is the case?
Good luck with that...Why would you sell at $5.20-5.40 if you plan on re-buying shares tomorrow at $5.87?
Maybe you meant $4.87?
Then why are they not buying today, and telling their clients about it?
He's got no money, he's just a pay for hire journalist. He'll slant the piece any way you like for the right price.
They just approved time release hydrocodone, Zydone, and all of the politician and states people are up in arms about it. There are more than enough painkillers in the marketplace, and this is another easy one to abuse. The FDA does not always make the "best" decision.
Exact same drug as Buprion. Zyban is the identical drug. He wants you to quite smoking.
And it's still down 4-1/2 hours later? The tutes were selling into it in a big way this morning, not on a miscommunication. Do you buy or sell anything on news if you don't know what the news is?
Yes, but this is only if Fartstain is telling the truth, which he has a problem doing sometimes.
The market cap for Arena is $883 Million. That's a far cry from $2.1B! Already, Fartstain is showing his ignorance, as Vivus' market cap is $419M. So Orex is already valued more highly than Vivus. Those other numbers are from around a year ago and are meaningless now.
Good question. This stock had its run from 3 to 6, and it wont' get any better until they deliver some respectable sales and earnings. I would not hold this stock at this point in time. What they have is a mixed generic product, which now may have to be reviewed by the FDA for scheduling. Naltrexone is made with Thebaine, which is super-powerful opiate from which all others are derived. That is how it keeps drug addicts from seeking street drugs. It was schedule II in the 1970s.
That can be the kick-back when a company tries to simply market a blend of 2 generics, instead of coming out with a novel, new chemical entity.
Cramer's flunky wrote: "Still, it's hard to ignore the potential value in Best Buy shares and the company could become 2015's best turnaround candidate in retail."
How many turnarounds can one company have???
Especially ones from the ghetto, where they really need to make some money! Spread the word amongst your friends.