This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Greenberg: Taking Nominations for 2013's Worst CEO

By: Herb Greenberg | 12/09/13 - 09:52 AM EST

Stocks in this article: CAT,AMZN,NFLX,GRPN,MSFT,BBRY

Every year this time I take nominations for the year's worst corporate CEO. I like to seek names from readers because, quite frankly, it helps spot names a screening process might miss. Not to mention that readers usually remember more than I do!

Usually, there is no lack of choices and my email and social media feeds light up with names. 

But this year -- the various calls have been met mostly with, well, little in the way of new names.

Is that because there are fewer bad CEOs? Nah. It's simpler than that: We're in a momentum-driven bull market, silly, and rising stock prices hide all sins. 

On one hand that makes it easier to spot the real losers, where even in a market like this investors are unforgiving. One of the most obvious, along those lines, appears to be longtime CEO Michael Jeffries at Abercrombie & Fitch, whose employment contract (albeit with tougher benchmarks) has been extended for another year. (Has he really become that bad, or is he just a victim of what happens to all fashion retailers at one point or another?)

And what about Eddie Lampert of Sears (SHLD)? He actually made the top spot on my list on my list years ago.

Or Caterpillar (CAT) CEO Doug Oberhelman, who has presided over one quarterly flop after another. (Is he really just the victim of bad timing and bad luck or bad execution?)

What about McDonald's (MCD) CEO Donald Thompson? (Did he just land the job at a classic juncture of McDonald's maturity? Could anybody else have done better?)

On the other hand, the bull-market sentiment hides those more or equally deserving, whose missteps are being temporarily papered over by higher stock prices. 

But that gets into something trickier. Consider this: If Amazon (AMZN) were being judged exclusively by its financial performance, not stock price, Jeff Bezos might get more than a few nominations.

Yet would he really deserve to be on a worst CEO list? Not only did he make the difficult transition from entrepreneur to chief of a multi-billion dollar enterprise, but along the way he executed nearly flawlessly in creating something that has not just survived but thrived -- and much of that is because he reinvests in the business at the expense of profits.

I like to think of Amazon this way: If it were a private company we would merely marvel, as customers, at how well it operates and how miraculously Bezos has executed.

You could say the same thing about Reed Hastings of Netflix (NFLX), yet he made my list a few years ago. Never mind the off-balance sheet content costs that help make its financials look better than they really are. Given what he built, it was painful to put Hastings on the list.

Yet he was a shoo-in as a nominee (not winner!) after Netflix's stock-rattling Qwiskster calamity. He had betrayed his customers -- and he knew it, conceding that he fell into the trap of a certain kind of arrogance that can accompany success.

Hastings went on to steer Netflix out of the muck, making him a candidate for best CEO lists, which is a long-winded way of getting to the point I'm trying to make: Even really good CEOs can be among any year's worst.

The worst CEO list is like a balance sheet -- it's based on a point in time. Many who've made the list, including Andrew Mason of Groupon (GRPN), Steve Ballmer of Microsoft (MSFT) and Jim Balsillie and Michael Lazaridis of Blackberry (BBRY), were gone within a year.

Others, like Hastings, not only survived but thrived.

In the end it's a subjective list, based on a combo of stock and financial performance. (I like to look at quarterly on a last-12-month basis. It tends to give a slightly more realistic picture.) I tend to avoid micro and small cap companies. But there are exceptions, and the only rule is that the CEO is currently on the job.

Nominees? Email me at herbonthestreet@thestreet.com.

-- Written by Herb Greenberg

Herb Greenberg, editor of Herb Greenberg's Reality Check, is a contributor to CNBC. He does not own shares, short or trade shares in an individual corporate security.

To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.

Markets

DOW 16,623.86 +9.05 0.05%
S&P 500 1,941.78 +0.50 0.03%
NASDAQ 4,418.24 -1.2380 -0.03%

Herb's Tweets

Brokerage Partners

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
Real Money Pro

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Trifecta Stocks

Trifecta Stocks analyzes over 4,000 equities weekly to find the elite 1% of stocks that pass rigorous quantitative, fundamental and technical tests.

Product Features:
  • Model portfolio
  • Trade alerts
  • Recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
Stocks Under $10

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Dividend Stock Advisor

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Breakout Stocks

Bryan Ashenberg, using sophisticated stock screening and fundamental research, identifies potentially explosive small and mid-cap stocks.

Product Features:
  • Model portfolio
  • Small-cap and mid-cap focus
  • Intraday trade alerts
  • Weekly roundups
Options Profits

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
Top Rated Stocks Top Rated Funds Top Rated ETFs