If you buy the company known as Hewlett-Packard (NYSE:HPQ) today, you're getting yourself a Whitman sampler.
Meg Whitman may or may not be a great turnaround CEO, but she's a great corporate infighter, and now the Queen of all she surveys. That much was made clear yesterday as Ray Lane, the former Oracle president who had been chairman of her board, resigned from that position.
The reason given was shareholders' anger over the acquisition of Autonomy by then-CEO Leo Apotheker. That decision was approved by the HP board. Meg Whitman was on that HP board.
But somehow she skates from that decision, as she has managed to deflect blame for the company's troubles on others throughout her tenure as CEO.
Since Whitman became CEO in September 2011, HP stock has gone both up and down. But it's actually little changed from where it was when she started. The company has not grown at all, and gone through almost $15 billion in losses, many of them blamed on past acquisitions. The last quarter, ending in January, saw 4% of revenue flow through to the bottom line.
Whitman has no new exciting products on offer, just a statement of intent regarding cloud computing that could have been written by a telecom company, and which matches those companies' strategies. The PC niche continues to circle the drain, there is no HP phone, the HP tablets are not competitive, printers are dying.
But she promises great things to come in two or three years.
What Whitman has succeeded in doing is stopping the rot. The company is no worse off now than it was a year and a half ago. The only shareholder gain I can see, assuming you're happy with a 2.37% dividend that the last quarter's earnings could barely pay, would be a sale to a larger, more stable operator. IBM (NYSE:IBM) and Oracle (NYSE:ORCL) could both afford to make a run at HP right now.
So, for that matter, could Microsoft (NASDAQ:MSFT), which is worth more than five times what HP is, be interested? That would be interesting.
Of course, Microsoft is just as lacking in vision as HP is. But at least HP shareholders would have a better currency to throw around, and they'd be rid of Whitman. By buying HP, Microsoft would more than double its sales, it would gain control of what's left of its ecosystem, and it might get a second look from the market.
But that's purely speculative. If you want to bet on Meg Whitman today, go ahead. But the promise of a turnaround at some future time does not impress me. There are better places to park money.