Eric Jackson - Seeking Alpha 'Eric Jackson' Tag RSS Syndication from SeekingAlpha.com SeekingAlpha.com http://seekingalpha.com/author/eric-jackson Why Is Bank of America So Bad at Picking Its Leaders? http://seekingalpha.com/article/176312-why-is-bank-of-america-so-bad-at-picking-its-leaders?source=feed 176312 Reports are out Wednesday that several of the candidates under consideration for the top job at Bank of America (BAC) have called on the board to consider breaking up the bank. They are having none of it. As a result, the CEO search for Ken Lewis' replacement continues.

All in all, you would have to give the board of Bank of America an "F" for how they've monitored management and succession planning since a firestorm enveloped the company last Fall.

]]> Thu, 03 Dec 2009 04:39:02 -0500 Eric Jackson Reports are out Wednesday that several of the candidates under consideration for the top job at Bank of America (BAC) have called on the board to consider breaking up the bank. They are having none of it. As a result, the CEO search for Ken Lewis' replacement continues.

All in all, you would have to give the board of Bank of America an "F" for how they've monitored management and succession planning since a firestorm enveloped the company last Fall.


Complete Story »]]> BAC Eric Jackson Facebook's Dual Class Shares: Another Reason to Avoid This Company http://seekingalpha.com/article/176141-facebook-s-dual-class-shares-another-reason-to-avoid-this-company?source=feed 176141
Facebook announced last week before the Thanksgiving holiday that it has created a dual-class share structure.

If you are an existing shareholder, your shares now have 10 times the voting power of any subsequently issued shares. It's widely viewed as a precursor move to holding an IPO in the next year or two.

]]> Wed, 02 Dec 2009 09:05:58 -0500 Eric Jackson
Facebook announced last week before the Thanksgiving holiday that it has created a dual-class share structure.

If you are an existing shareholder, your shares now have 10 times the voting power of any subsequently issued shares. It's widely viewed as a precursor move to holding an IPO in the next year or two.


Complete Story »]]> GOOG YHOO Eric Jackson Paulson's Future Performance: No Guarantees http://seekingalpha.com/article/175389-paulson-s-future-performance-no-guarantees?source=feed 175389 There were two reactions I got to my column last week on Greg Zuckerman's new book The Greatest Trade Ever about John Paulson's $20 billion bearish housing trade in 2007: "He was lucky" and "He won't do it again."

Even though these comments are mostly sour grapes, here's the problem with overanalyzing winners -- for the financial media, potential investors and even money managers, like Paulson himself.

]]> Thu, 26 Nov 2009 02:42:55 -0500 Eric Jackson There were two reactions I got to my column last week on Greg Zuckerman's new book The Greatest Trade Ever about John Paulson's $20 billion bearish housing trade in 2007: "He was lucky" and "He won't do it again."

Even though these comments are mostly sour grapes, here's the problem with overanalyzing winners -- for the financial media, potential investors and even money managers, like Paulson himself.


Complete Story »]]> Eric Jackson Red Robin Must Start Marketing Aggressively Again http://seekingalpha.com/article/174853-red-robin-must-start-marketing-aggressively-again?source=feed 174853 One of the more surprising sectors of 2009 has been casual dining restaurants. At the start of the year amid concerns of consumer deleveraging, some analysts were expecting a prolonged battering of any stocks with consumer discretionary exposure. Yet restaurants have held up very strongly, especially snapping back from the March lows. It turns out Americans like eating out -- even when times are tough -- and I've identified a stock poised to benefit from the casual-dining trend.

The Powershares Dynamic Food & Beverage (PBJ) ETF is up 9% for the year, but many specialty restaurant chains have far outpaced that. PF Chang's Bistro (PFCB) is up 53% so far this year, and Buffalo Wild Wings (BWLD) is up an even more impressive 64% year to date. The well-regarded restaurant conglomerate Darden (DRI) is up a more modest 15% YTD (after a very strong recovery in the spring that has since tailed off).

]]> Mon, 23 Nov 2009 11:29:44 -0500 Eric Jackson One of the more surprising sectors of 2009 has been casual dining restaurants. At the start of the year amid concerns of consumer deleveraging, some analysts were expecting a prolonged battering of any stocks with consumer discretionary exposure. Yet restaurants have held up very strongly, especially snapping back from the March lows. It turns out Americans like eating out -- even when times are tough -- and I've identified a stock poised to benefit from the casual-dining trend.

The Powershares Dynamic Food & Beverage (PBJ) ETF is up 9% for the year, but many specialty restaurant chains have far outpaced that. PF Chang's Bistro (PFCB) is up 53% so far this year, and Buffalo Wild Wings (BWLD) is up an even more impressive 64% year to date. The well-regarded restaurant conglomerate Darden (DRI) is up a more modest 15% YTD (after a very strong recovery in the spring that has since tailed off).


Complete Story »]]> RRGB DIN EAT BWLD PFCB PBJ DRI TXRH Eric Jackson Gregory Zuckerman's 'The Greatest Trade Ever' Teaches the Lessons of John Paulson http://seekingalpha.com/article/174014-gregory-zuckerman-s-the-greatest-trade-ever-teaches-the-lessons-of-john-paulson?source=feed 174014 If it wasn't clear already that John Paulson had reached the zenith of his hedge fund profession, one only had to watch how fervently the media and blogosphere digested the news of Paulson & Co.'s quarterly holdings which was released last Friday.

Market commentators immediately pounced on how the one-time housing bear had loaded up on 300 million shares in Citigroup (C) during the quarter, while dumping his entire holdings in Goldman Sachs (GS).

]]> Wed, 18 Nov 2009 08:12:19 -0500 Eric Jackson If it wasn't clear already that John Paulson had reached the zenith of his hedge fund profession, one only had to watch how fervently the media and blogosphere digested the news of Paulson & Co.'s quarterly holdings which was released last Friday.

Market commentators immediately pounced on how the one-time housing bear had loaded up on 300 million shares in Citigroup (C) during the quarter, while dumping his entire holdings in Goldman Sachs (GS).


Complete Story »]]> C GS Eric Jackson Two Important Yet Overlooked Exec Comp Factors http://seekingalpha.com/article/173817-two-important-yet-overlooked-exec-comp-factors?source=feed 173817
We read a lot about corporate governance and executive compensation these days, in the wake of last year's economic collapse. Many politicians are now jumping into the fray, saying we need to legislate certain governance requirements, such as splitting the roles of CEO and chairman or lowering CEO pay. Although philosophically I support many of these arguments, it turns out that many of these prescriptions have no long-term relationship with an increase in a company's stock price. Which of these governance and executive pay factors should you pay attention to as an investor?

As any good investor knows, there's no silver-bullet metric (such as P/E ratio or price-to-book or leverage ratio) that, on its own, predicts a stock future increase or decrease. Even if you take a number of internal factors into account, your perfect analysis can be thrown out the window by an industry downturn or some random comment by Tim Geithner on his trip to Asia.

With this in mind, I believe you can improve your investment batting average by paying attention to two factors relating to corporate governance and executive compensation that most people overlook.

]]> Tue, 17 Nov 2009 11:47:08 -0500 Eric Jackson
We read a lot about corporate governance and executive compensation these days, in the wake of last year's economic collapse. Many politicians are now jumping into the fray, saying we need to legislate certain governance requirements, such as splitting the roles of CEO and chairman or lowering CEO pay. Although philosophically I support many of these arguments, it turns out that many of these prescriptions have no long-term relationship with an increase in a company's stock price. Which of these governance and executive pay factors should you pay attention to as an investor?

As any good investor knows, there's no silver-bullet metric (such as P/E ratio or price-to-book or leverage ratio) that, on its own, predicts a stock future increase or decrease. Even if you take a number of internal factors into account, your perfect analysis can be thrown out the window by an industry downturn or some random comment by Tim Geithner on his trip to Asia.

With this in mind, I believe you can improve your investment batting average by paying attention to two factors relating to corporate governance and executive compensation that most people overlook.


Complete Story »]]> LVS HPQ Eric Jackson Clear 'Rules of the Game' for Free Market Capitalism http://seekingalpha.com/article/172920-clear-rules-of-the-game-for-free-market-capitalism?source=feed 172920 Appreciate all the Seeking Alpha comments I've received on my article titled "It's time to champion real free market capitalism."

Several have said that "real" free market capitalism should have no government involvement.

]]> Thu, 12 Nov 2009 03:31:19 -0500 Eric Jackson Appreciate all the Seeking Alpha comments I've received on my article titled "It's time to champion real free market capitalism."

Several have said that "real" free market capitalism should have no government involvement.


Complete Story »]]> Eric Jackson Four Risks to Las Vegas Sands' Shareholders http://seekingalpha.com/article/172913-four-risks-to-las-vegas-sands-shareholders?source=feed 172913 With its stock price up over 800% since its March lows, Las Vegas Sands (LVS) plans to raise up to $3.3 billion in a Hong Kong IPO listing of its Asian assets later this month. While it has great potential upside from its properties in gambling territory Macau, there are still a number of risk factors facing the casino that could cause it to trip its debt covenants on its massive $12 billion in liabilities over the next 18 months. Because of those risks and lax corporate governance oversight, I've initiated a short position on the stock. Here's why.

Risk 1: Losses will persist without a meaningful upturn in operating performance. Despite a surge in Macau-based profits and management claims of cutting $500 million in operating costs from the business, Sands is still losing money, and at an increased rate year-on-year. It had over $1 billion in operating expenses in the recent quarter alone. The bet that bulls on the stock are making is that we've hit bottom and that rooms, banqueting and convention revenue will all come back from current levels. On the recent earnings call, management noted that Macau had done particularly well recently, partially because of increased traffic over the October Golden Week holiday. The company pointed out that Las Vegas room bookings were up for January and February. However, the likelihood of a continued soft market in Vegas (especially with MGM's new CityCenter dumping 5,000 new rooms on the strip next month) seems high, even with Macau. It appears reasonable to assume that losses will persist over the next two years, at a time when it's vital for LVS to navigate its way through its debt obligations.

]]> Thu, 12 Nov 2009 03:26:04 -0500 Eric Jackson With its stock price up over 800% since its March lows, Las Vegas Sands (LVS) plans to raise up to $3.3 billion in a Hong Kong IPO listing of its Asian assets later this month. While it has great potential upside from its properties in gambling territory Macau, there are still a number of risk factors facing the casino that could cause it to trip its debt covenants on its massive $12 billion in liabilities over the next 18 months. Because of those risks and lax corporate governance oversight, I've initiated a short position on the stock. Here's why.

Risk 1: Losses will persist without a meaningful upturn in operating performance. Despite a surge in Macau-based profits and management claims of cutting $500 million in operating costs from the business, Sands is still losing money, and at an increased rate year-on-year. It had over $1 billion in operating expenses in the recent quarter alone. The bet that bulls on the stock are making is that we've hit bottom and that rooms, banqueting and convention revenue will all come back from current levels. On the recent earnings call, management noted that Macau had done particularly well recently, partially because of increased traffic over the October Golden Week holiday. The company pointed out that Las Vegas room bookings were up for January and February. However, the likelihood of a continued soft market in Vegas (especially with MGM's new CityCenter dumping 5,000 new rooms on the strip next month) seems high, even with Macau. It appears reasonable to assume that losses will persist over the next two years, at a time when it's vital for LVS to navigate its way through its debt obligations.


Complete Story »]]> LVS Eric Jackson 7 Steps Towards Real Free Market Capitalism http://seekingalpha.com/article/172664-7-steps-towards-real-free-market-capitalism?source=feed 172664 Market commentators and the White House have been quick to blame last year’s economic meltdown on a free market run amok. And they’ve used that false assumption to justify their unprecedented response of government intervention and increased regulation.

But we’ve never really had free market capitalism in this country. The last 30 years of America’s market system is better described as “mixed crony capitalism” – one part capitalism, one part government intervention through various programs, and one part corporate cronyism where officers and directors of big businesses pay themselves more, lobby politicians on both sides of the aisle and gain more power through favorable governmental regulations including mergers.

]]> Wed, 11 Nov 2009 03:07:24 -0500 Eric Jackson Market commentators and the White House have been quick to blame last year’s economic meltdown on a free market run amok. And they’ve used that false assumption to justify their unprecedented response of government intervention and increased regulation.

But we’ve never really had free market capitalism in this country. The last 30 years of America’s market system is better described as “mixed crony capitalism” – one part capitalism, one part government intervention through various programs, and one part corporate cronyism where officers and directors of big businesses pay themselves more, lobby politicians on both sides of the aisle and gain more power through favorable governmental regulations including mergers.


Complete Story »]]> BAC C Eric Jackson What the SEC Should Learn from Galleon http://seekingalpha.com/article/171380-what-the-sec-should-learn-from-galleon?source=feed 171380 The government's case against Raj Rajaratnam, founder of hedge fund Galleon Group, on the charge of insider trading, alleges that the hedge fund manager's primary competitive advantage for investors was a web of connections close to or inside technology companies feeding him illegal tips on future directions of the companies' stock prices.

What's shocking is how Rajaratnam is accused of having, over at least 10 years, cultivated a network of insiders feeding him nonpublic information about future earnings announcements from public companies like AMD (including its former CEO), IBM, Intel (INTC), and some of their most prestigious advisers like McKinsey & Co.

]]> Thu, 05 Nov 2009 02:10:36 -0500 Eric Jackson The government's case against Raj Rajaratnam, founder of hedge fund Galleon Group, on the charge of insider trading, alleges that the hedge fund manager's primary competitive advantage for investors was a web of connections close to or inside technology companies feeding him illegal tips on future directions of the companies' stock prices.

What's shocking is how Rajaratnam is accused of having, over at least 10 years, cultivated a network of insiders feeding him nonpublic information about future earnings announcements from public companies like AMD (including its former CEO), IBM, Intel (INTC), and some of their most prestigious advisers like McKinsey & Co.


Complete Story »]]> Eric Jackson Icahn Should Give Up Running Other People's Money http://seekingalpha.com/article/169609-icahn-should-give-up-running-other-people-s-money?source=feed 169609 After a string of disastrous investments and his departure from Yahoo!'s (YHOO) board last Friday, it's time for Carl Icahn to hang it up running other people's money. Here's why.

Icahn's decision to leave the Yahoo! board comes a year after mounting a costly and distracting proxy contest to get elected. That's his right, of course. After all, investors in his Icahn Partners hedge fund were the ones who footed the bill for his efforts.

]]> Wed, 28 Oct 2009 16:08:17 -0400 Eric Jackson After a string of disastrous investments and his departure from Yahoo!'s (YHOO) board last Friday, it's time for Carl Icahn to hang it up running other people's money. Here's why.

Icahn's decision to leave the Yahoo! board comes a year after mounting a costly and distracting proxy contest to get elected. That's his right, of course. After all, investors in his Icahn Partners hedge fund were the ones who footed the bill for his efforts.


Complete Story »]]> YHOO MSFT Eric Jackson The Truth in Lessig's Critique of Transparency http://seekingalpha.com/article/168103-the-truth-in-lessig-s-critique-of-transparency?source=feed 168103 Lawrence Lessig's recent thought-provoking article in the New Republic challenges the assumption that more sunlight is always a better disinfectant for corruption and bad behavior than less.

Although his primary focus is on how more transparency doesn't always lead to better political outcomes, there are obvious implications of his argument to the world of corporate governance and executive compensation.

]]> Thu, 22 Oct 2009 08:40:13 -0400 Eric Jackson Lawrence Lessig's recent thought-provoking article in the New Republic challenges the assumption that more sunlight is always a better disinfectant for corruption and bad behavior than less.

Although his primary focus is on how more transparency doesn't always lead to better political outcomes, there are obvious implications of his argument to the world of corporate governance and executive compensation.


Complete Story »]]> RMG MCO MHP Eric Jackson HP Employee Disgruntlement Runs Deep http://seekingalpha.com/article/165651-hp-employee-disgruntlement-runs-deep?source=feed 165651 My post a few weeks ago on Mark Hurd's perks at HP (HPQ) has generated a lot of traffic and email comments -- especially from current or former HP/EDS employees.

Here is a link from one ex-EDS'er in Germany upset at the way things have played out.

]]> Fri, 09 Oct 2009 03:58:00 -0400 Eric Jackson My post a few weeks ago on Mark Hurd's perks at HP (HPQ) has generated a lot of traffic and email comments -- especially from current or former HP/EDS employees.

Here is a link from one ex-EDS'er in Germany upset at the way things have played out.


Complete Story »]]> HPQ Eric Jackson Yahoo! CEO Carol Bartz's Continued Share Dumps Reflect Poorly on Leadership http://seekingalpha.com/article/165419-yahoo-ceo-carol-bartz-s-continued-share-dumps-reflect-poorly-on-leadership?source=feed 165419 Editor's note, 10/10/09: Yahoo's public relations firm sent an official dispute to Seeking Alpha regarding this and other recent articles by Eric Jackson on CEO Carol Bartz's sale of stock and compensation agreement, claiming the articles are 'inaccurate and misleading.' Read Yahoo's response here.

As predicted last month, when I first raised this issue, Yahoo! (YHOO) disclosed late Friday that Carol Bartz had sold another $1.3 million of Yahoo! stock at the end of September. This brings her total Yahoo! share sales for the year to $3.3 million.

]]> Thu, 08 Oct 2009 02:50:12 -0400 Eric Jackson Editor's note, 10/10/09: Yahoo's public relations firm sent an official dispute to Seeking Alpha regarding this and other recent articles by Eric Jackson on CEO Carol Bartz's sale of stock and compensation agreement, claiming the articles are 'inaccurate and misleading.' Read Yahoo's response here.

As predicted last month, when I first raised this issue, Yahoo! (YHOO) disclosed late Friday that Carol Bartz had sold another $1.3 million of Yahoo! stock at the end of September. This brings her total Yahoo! share sales for the year to $3.3 million.


Complete Story »]]> YHOO Eric Jackson Wynn's CEO Starts Cashing Out http://seekingalpha.com/article/165415-wynn-s-ceo-starts-cashing-out?source=feed 165415 Steve Wynn and his chief operating officer are pushing back from the table.

Since the end of July, Steve Wynn has sold $114 million worth of shares in Wynn (WYNN) and his Chief Operating Officer Marc Schorr has sold over $7 million. It's the first time in the last decade that Wynn has sold such a large chunk of shares. For Schorr, the proceeds from his sale exceeded his average annual total compensation over the past three years.

]]> Thu, 08 Oct 2009 02:24:47 -0400 Eric Jackson Steve Wynn and his chief operating officer are pushing back from the table.

Since the end of July, Steve Wynn has sold $114 million worth of shares in Wynn (WYNN) and his Chief Operating Officer Marc Schorr has sold over $7 million. It's the first time in the last decade that Wynn has sold such a large chunk of shares. For Schorr, the proceeds from his sale exceeded his average annual total compensation over the past three years.


Complete Story »]]> WYNN MGM LVS Eric Jackson While eBay Burned, Whitman Fiddled http://seekingalpha.com/article/164192-while-ebay-burned-whitman-fiddled?source=feed 164192 I've recently criticized Yahoo!'s (YHOO) Carol Bartz and Hewlett-Packard's (HPQ) Mark Hurd for excessive pay and perks, given their companies' performances.

My focus on Silicon Valley gluttony would be incomplete without discussing the perks at eBay (EBAY).

]]> Thu, 01 Oct 2009 03:39:11 -0400 Eric Jackson I've recently criticized Yahoo!'s (YHOO) Carol Bartz and Hewlett-Packard's (HPQ) Mark Hurd for excessive pay and perks, given their companies' performances.

My focus on Silicon Valley gluttony would be incomplete without discussing the perks at eBay (EBAY).


Complete Story »]]> EBAY Eric Jackson Yahoo Board Director Maggie Wilderotter Makes for the Door http://seekingalpha.com/article/163894-yahoo-board-director-maggie-wilderotter-makes-for-the-door?source=feed 163894 Maggie Wilderotter -- the most recent addition to Yahoo!'s (YHOO) board, joining in July 2007 (not including Carl Icahn and his band of merry men who joined last September) -- is now its most recent departing director. She gave the company notice last week that she plans to step down at the end of the year.

The fact that she's leaving is "not due to any disagreement with the Company on any matter related to the Company’s operations, policies or practices."

]]> Tue, 29 Sep 2009 09:27:56 -0400 Eric Jackson Maggie Wilderotter -- the most recent addition to Yahoo!'s (YHOO) board, joining in July 2007 (not including Carl Icahn and his band of merry men who joined last September) -- is now its most recent departing director. She gave the company notice last week that she plans to step down at the end of the year.

The fact that she's leaving is "not due to any disagreement with the Company on any matter related to the Company’s operations, policies or practices."


Complete Story »]]> YHOO FTR XRX PG Eric Jackson Shareholders Must Put an End to Decoupled Pay-for-Performance http://seekingalpha.com/article/163597-shareholders-must-put-an-end-to-decoupled-pay-for-performance?source=feed 163597 Over the past 2 weeks, I’ve criticized Yahoo!’s (YHOO) Carol Bartz and HP’s (HPQ) Mark Hurd for excessive pay and perks, given their companies’ recent performance. It’s been interesting to read the many emails I’ve received on the articles – mostly from employees of both companies.

A few emails – maybe 5% -- take the CEO’s side and make the case that paying our leaders a lot of money is part of our capitalist system. Their advice to me: get over it already.

]]> Sun, 27 Sep 2009 07:24:03 -0400 Eric Jackson Over the past 2 weeks, I’ve criticized Yahoo!’s (YHOO) Carol Bartz and HP’s (HPQ) Mark Hurd for excessive pay and perks, given their companies’ recent performance. It’s been interesting to read the many emails I’ve received on the articles – mostly from employees of both companies.

A few emails – maybe 5% -- take the CEO’s side and make the case that paying our leaders a lot of money is part of our capitalist system. Their advice to me: get over it already.


Complete Story »]]> HPQ YHOO Eric Jackson HP's Executive Comp Is Troubling in a Year of Worker Pay Cuts http://seekingalpha.com/article/163169-hp-s-executive-comp-is-troubling-in-a-year-of-worker-pay-cuts?source=feed 163169 Mark Hurd was brought in to take the helm at Hewlett-Packard (HPQ) in 2005.

He's well regarded by Wall Street for turning the company from a bureaucratic has-been to a market leader again. In the first 2 1/2 years of Hurd's tenure as leader, HP's stock increased 137%. For the last two years, however, HP's stock performance has been mediocre, dropping 5%. Although that was better than the Nasdaq, it tracked that index very closely over that period.

]]> Thu, 24 Sep 2009 08:25:38 -0400 Eric Jackson Mark Hurd was brought in to take the helm at Hewlett-Packard (HPQ) in 2005.

He's well regarded by Wall Street for turning the company from a bureaucratic has-been to a market leader again. In the first 2 1/2 years of Hurd's tenure as leader, HP's stock increased 137%. For the last two years, however, HP's stock performance has been mediocre, dropping 5%. Although that was better than the Nasdaq, it tracked that index very closely over that period.


Complete Story »]]> HPQ DELL Eric Jackson Are Yahoo's Charitable Donations Right and Proper? http://seekingalpha.com/article/162864-are-yahoo-s-charitable-donations-right-and-proper?source=feed 162864 If I told you that Yahoo! (YHOO) had made a charitable contribution to an American University in the last year, which one would you guess? Stanford University, where Jerry and David dreamed up the company in the computer labs more than a decade ago? Cal? San Jose State? Try Duke.

You probably weren't familiar with a long fabled relationship between the Silicon Valley-based Internet company and the fine academic institution on the other side of the country on Tobacco Road. Let me connect the dots for you. Yahoo!'s Chairman, Roy Bostock, and fellow director, Gary Wilson (both appointed by former CEO Terry Semel), serve on the board of the Fuqua School of Business at Duke.

]]> Wed, 23 Sep 2009 03:29:07 -0400 Eric Jackson If I told you that Yahoo! (YHOO) had made a charitable contribution to an American University in the last year, which one would you guess? Stanford University, where Jerry and David dreamed up the company in the computer labs more than a decade ago? Cal? San Jose State? Try Duke.

You probably weren't familiar with a long fabled relationship between the Silicon Valley-based Internet company and the fine academic institution on the other side of the country on Tobacco Road. Let me connect the dots for you. Yahoo!'s Chairman, Roy Bostock, and fellow director, Gary Wilson (both appointed by former CEO Terry Semel), serve on the board of the Fuqua School of Business at Duke.


Complete Story »]]> YHOO Eric Jackson