more right than wrong

Is Radio Shack Poised for Another Double?

I thought I would point out just how wrong you were about the future stock prospects of RSH. Have you looked at the stock lately? It closed today at $13.40.

Not only were you wrong about the future you don’t even have your facts right about the past.

First of all, the CEO of RadioShack from May of 1999 through May of 2005 was Len Roberts, not David Edmondson. Mr. Edmondson was CEO of RadioShack from May 2005 through February 2006.

Second the reduction in stores, that you gave Julian Day credit for, were announced and were in progress prior to Mr. Day joining the company. In addition the reduction in corporate staff that you gave Mr. Day credit for was also announced and put into action prior to Mr. Day joining the company. The reduction in advertising spending you give credit to Mr. Day for accomplishing was also announced and put into action prior to Mr. Day's arrival.

Mr. Day deserves credit for the execution of the plan but you cannot give him credit for developing the plan. That plan was developed by David Edmondson and his senior management team prior to Mr. Edmondson resigning from the company.

While Mr. Edmondson clearly made some mistakes in his personal life, you cannot and should not take away the credit due him for making some pretty tough decisions against the expressed desires of his direct boss, Board Chairman Len Roberts.

Mr. Roberts grew the top line through a single line of business, wireless phone sale. He let the balance of the business die on the vine and let cost get totally out of control.

Mr. Day got cost under control, but even to this day has no plan for what you refer to as the profitable growth phase. Did you attend the last shareholder meeting a few weeks ago? If Mr. Day has a plan he sure needs let someone know what it is soon, because without some articulated plan you should not be surprised when this stock dips below $10.00 a share. Look for that to happen sometime prior to the end of the third quarter.

Cost have now been cut to the bone and sales keep declining. Put those facts in your model and tell your readers the truth about what happens next.

Furthermore, sales will decline even more in future months because one of the Shack's major wireless carriers (Sprint) has tightened it's credit standards. Don't be shocked when wireless sales decline by 20% in the third quarter as a result.

You got the history wrong, you got the most recent past wrong...and you have the future wrong. I hope you will have the integrity to correct your mistakes and lack of knowledge in as public a way as you made them.