The deal chatter surrounding the company appears to be signaling just how bad its underlying performance really is.
Here is the latest roundup of Reality Check and the Watch List.
In a letter to employees filed with the SEC Thursday, Valeant Pharmaceuticals' CEO Michael Pearson claimed critics are using “the wrong assumptions” as they analyze the company.Wrong assumptions. Really? That’s like a company telling a reporter or analyst, who pushes too hard, that they’re asking the “wrong” questions. (Which, in general, usually means they're the right questions.)From the letter:"Our actions have generated a lot of attention from the media, and we expect this transaction will continue to be the focus of many press reports. Unfortunately, some of these reports have criticized our overall business model and raised questions about our approach to R&D. We disagree with these criticisms and they are often based upon wrong assumptions, and we have been setting the record straight with facts about our operating model and the performance of our businesses."
I totally missed this story when it first came out in May, but it's just as relevant today -- even more so with the surge in shares of Boulder Brands BDBD, a gluten-free play: The doctor behind the gluten-free craze says he was wrong.Dr. Peter Gibson's reversal has been widely reported in a variety of publications, including Real Clear Science, the New Yorker and even on Good Morning America.But you wouldn't know it by the stock-goosing comments of Boulder Brands' CEO Stephen Hughes, at a William Blair conference earlier this week. Boulder owns a number of leading gluten-free brands, including Udi's and Glutino.In his presentation, speaking of gluten, he said:"So the reality is, this is one of those ingredients that we screwed around with. We hybridized wheat to make it more glutinous, so you could make bread faster, cheaper, better. Gluten is glue in Latin, and what we created was something that did make better bread, did make cheaper bread, but it's very hard to digest and it creates a lot of unintended consequences."
Tibco Software has quietly attracted value-oriented investors known to rattle cages.
That lovely comps growth came at the expense of gross margin. Plus, updates on Neustar and RealPage.
The "One Sick Bird" in that headline, regarding United Continental Holdings, is straight out of a headline in today's Wall Street Journal, which refers to the airline as "one sick bird."I fly United monthly from San Diego to New York. I have Gold status. I generally sit in first class, which means I should see the airline at its best.What I see is an airline that offers zero consistency in product, morale or service.And this is four years after the two airlines merged. Yet, as the Journal points out, they still haven't merged their fleets because they can't get the flight attendants to sign a new, joint contract. (Compare that with Delta, which somehow not only managed to rapidly merge two airlines, but do it swiftly and almost seamlessly.)In the Journal piece, United CEO Jeff Smisek, who hit my list of nominees last year for Worst CEO, put the blame everywhere but at his office. He said, notably:"Every hub has to earn its keep every day. Nothing is sacrosanct at any hub. We will make adjustments as are appropriate."
Here's a recap of late Friday and also some Watch List adjustments.
The stock fell 9% after hours. But was the news really new?
I was on-air at CNBC Tuesday when one of the anchors asked Jeff Saut, the chief strategist of Raymond James, his favorite stocks. Jeff, an old friend, immediately said, Iridium. To which I said, 'I just red-flagged Iridium in a 3,000-word piece on Reality Check.' To which he said, 'Ron Baron,' of Baron Funds, a well-respected manager, with an extraordinary track record, just bought a lot of Iridium's stock.' To which I said, 'Green flags and red flags, that's what makes markets.' That is the one thing I don't believe you'll find any disagreement regarding Iridium, or any other company. In my years of doing this, there is one truism: There are very smart people, who think they know better, on both sides of many stocks. Often they both get it right and wrong, depending on timing. But in the end, one often prevails.