Some Companies Answer the Call

Sometimes you end up downright bullish when you hear a good conference call.
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One day some PR firm somewhere is going to give a tutorial on how to give a good conference call. Until then, the conference call will continue to be a haphazard, hit-or-miss exercise.

Given that it's the single most important nonoperating chance a company has to boost its multiple, you would think some of these companies would give a little more thought as to how to handle the task.

Some of the ones I have been in on during the last two weeks remind me of my stage portrayal of Lt. Rooney in my high school's version of

Arsenic and Old Lace

: wooden, unsure and stuttering. You sure didn't want your folks watching.

I don't want to blast the bad-call companies here; no percentage in slamming the easily slammed. Instead I want to point toward what the good ones did right.

Let's take

United Technologies

(UTX) - Get Report

. Here is a boring old-line industrial company that gave a call that made me feel like I was listening to a company totally in control of its own destiny. The execs talked about goals they had reached, goals they had met and goals they intend to meet. They discussed repeatedly what they were doing for the shareholder. They gave me the feeling that United Tech wouldn't do anything unless it would be good for the stock short- and long-term. They also spoke cogently about acquisitions and debt use and how they would be balanced against share buybacks, but that the shareholder was most important.

What made me juiced about United Tech, however, was the confidence. You couldn't tell the difference between the Q&A and the prepared part of the call. Both were so smooth.

Tyco

(TYC)

did the same. The managers' cool confidence and on-point message -- including the deft use of examples to show how when Tyco buys a company its margins go up fast -- and their insistence in not straying from core competencies made me feel great as a shareholder.

The

PMC-Sierra

(PMCS)

call did it for my partner,

Jeff Berkowitz

. Now, of course, PMC has a business that is smoking, so it had a leg up on most companies. But Jeff was blown away about how PMC positions itself smack in the middle of all the hot areas of telco tech.

These three companies must be distinguished from a whole host of very well run companies that delegate the conference call to some automaton who has no sense of what we are looking for and thinks that it doesn't matter much anyway. Or the ones that weren't ready for the obvious Y2K questions. Or the ones that couldn't explain away possible third-quarter summer slowdowns. Geez!! Talk about stuff you should be ready for.

Some of these companies don't realize that there are pools of money all over the country that are on conference call after conference call. We are always searching for new better ideas. We are always trying to cull the old bad ideas. You screw up the conference call these days, we vote with our feet. Sometimes before the call is over. But if you do a good job, we buy.

I had no intention, for example, of being long UTX. I was listening to the call strictly to get a sense of the macro and of aerospace. I came away wanting to buy United Tech.

And I did!

Random musings

: Don't really want to give too much

credit to

Eisinger

on

Centocor

(CNTO)

. It was

Dan Dorfman

who got that one right and Eisinger who spooked you out of it. I bash Dorfman all the time, which means that when he gets it right I owe it to him to point it out.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Tyco and United Tech. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.