We want credibility from the execs we bank with. Credibility is the key currency that they have. It cannot be tarnished. If it is, we blow the stock out and we take no prisoners. You lose the credibility, it can't be rebuilt.
We talked about this credibility issue at length this week when
Naveen Jain visited us. I first met Naveen on
"Squawk Box" and he talked a big game. I thought, "Who the heck is this guy?"
Sure enough, when
Matt "Net Without Wires" Jacobs
joined us last year he pushed us hard to buy InfoSpace. I am glad we listened. You know why he liked it so much? Because Naveen had demonstrated that, despite his incessant promotion of the power of the InfoSpace story, he delivered on his promises. He got contract after contract for his technology. He still has delivered. The man has credibility and as long as he maintains that credibility, InfoSpace will be a core holding. (Please be careful with this stock, it is thin and if it explodes up at any time we will sell some.)
Who doesn't? Well, how about these jokers at
. Can you believe that shamelessness, that buffoonery? One day they are merging with X, next with Y, then again with X and then again Y. That's not how you build credibility.
Or the folks at
. You bet we are still furious that Henry Silverman looks like he is going to get away with that famed conference call when he knew that everything was going to hell at the company but he assured us that all was just great. Credibility doesn't grow on trees, Henry.
Yes, in an era where indeed it is hard to come up with a valuation matrix, we like to measure execs by what they promise and what they deliver.
That's something that is still working. Credibility will always work as a measure of a company's stock.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long InfoSpace. 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