4. Insulting AMD
Okay, we admit it. We here at the 5 Dumbest may be overly sharp with our barbs at times, and our commentary can occasionally be a tad too malicious even for the thickest-skinned Wall Street warrior. So for all those folks out there who we may have offended -- knowingly or unknowingly -- by stretching a joke beyond its breaking point, please accept our humblest apologies.
We repeat. We're very, very sorry if we went beyond our Dumbest mandate and were unreasonably unkind to you. And by "you," we're talking about all our past targets, not just those overpaid do-nothings Dick Parsons and Robert Rubin at Citigroup.
All that said, it must also be noted that we aren't the only flamethrowers out there. Not by a long shot. Take Bernstein Research's Stacy Rasgon for example. His jabs at AMD (AMD) late last week after its disappointing earnings report were as -- if not more -- vicious than any punches we've failed to pull.The chip maker said revenue in its third quarter fell 25% since last year to $1.27 billion, yielding a loss of 20 cents a share. Analysts, for their part, had penciled in a top-line total of $1.28 billion and a loss of 13 cents per share. The company also announced plans to reduce its workforce by 15% on account of problems in the PC industry and swallow a restructuring charge of $80 million. AMD CEO Rory Read attempted to spin the news as much as he could saying, "It is clear that the trends we knew would re-shape the industry are happening at a much faster pace than we anticipated. As a result, we must accelerate our strategic initiatives to position AMD to take advantage of these shifts and put in place a lower cost business model." Hey, what do you expect the guy to say after seeing his stock decline 60% so far this year to just a shade above two bucks? What more can he do when the PC market is in the crapper? In this case, even our admittedly hard hearts go out to the guy. Not Stacy Rasgon's at Bernstein however. No, Rasgon, who apparently cheered the stock all the way down like he was riding a flume at an amusement park, splashed water on Read's plans Friday while cutting his rating to "market perform" from "outperform." "Frankly, the most common adjective that comes up when we discuss the company with clients is, simply, 'un-investable.' We are now believers," spewed Rasgon, who also slashed his price target to $2.50 from $4. Ouch! That's harsh even by our standards. And that wasn't the entirety of Rasgon's self and AMD loathing. "We acknowledge the risk of downgrading at what appears to be a bottom (indeed, we have done it before with this name) but we truly have zero conviction in the name," added Rasgon. Imagine that. Supporting a stock all this time and then being so spiteful as to call it 'un-investable.' To be perfectly candid, that's beneath even us! Okay. It's not. But you know the old saying: Misanthropy loves company.
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