5. Darden's Dumb Excuse
CEO thinks the press is out to get him over his Obamacare cutbacks, then, to borrow a phrase from
, "Wait till Otis sees us!"
Shares of the restaurant company sank more than 10% on Tuesday after head honcho Clarence Otis lowered financial expectations for both Darden's fiscal second quarter and full year, citing a drop in business at its Olive Garden, Red Lobster and LongHorn Steakhouse chains. For its 2013 fiscal year, Darden said it expected earnings of $3.29 to $3.49 per share, significantly down from the company's earlier guidance of $3.76 to $3.90. Prior to Darden's preannouncement, Wall Street's consensus 2013 estimate was $3.88.
What's behind the dreary forecast? A lot of things, according to Otis, including promotions that did not "resonate with financially stretched consumers," Hurricane Sandy hitting East coast locations and the purchase of Yard House restaurants.
To be honest, had Otis stopped there, we would have let him slide. Darden's been such a serial outperformer over the past decade that we would have been perfectly willing to overlook even a massive earnings whiff like this one.
But then, like Brother Bluto in the Faber College cafeteria, he started a food fight, taking aim squarely at overeducated, underpaid ink-stained wretches like us. And, as a result, we just had to respond.
Otis proceeded to blame the company's less-than-stellar results and cautious outlook on "negative media coverage that focused on Darden ... and how we might accommodate health-care reform."
Negative media coverage? Come on, Clarence, get some clarity. We remember the hullabaloo this past fall when you tested plans to put more workers on part-time schedules to lessen the impact of the president's health-care plan. And we understand it's a serious issue for a chain that has more than 2,000 restaurants and 185,000 employees.
Nevertheless, you can't pin your Obamacare problems on us! We didn't keep people from eating at your restaurants. It's the Olive Garden's menu, not a muckraking media that's your biggest problem.
On a positive note, at least Otis didn't blame the fiscal cliff for his company's woes like
CEO did this week. If that guy really believes that the government's budget squabbles are keeping kids from listening to Taylor Swift on his online radio station, then he's not too swift himself.
Or, as the boys in Delta House might say, he's one Shama Lama Ding Dong!
4. SodaStream's Super Slam
Last week a bunch of bumbling British bureaucrats idiotically banned a benign
advertisement. Because of their bone-headed behavior, the commercial became an online blockbuster.
This week the make-your-own-soda maker mocked those same pusillanimous pen-pushers by pronouncing that it will reproduce the wildly popular ad during February's Super Bowl. They plan on paying a pretty penny of more than $3.7 million for the pleasure, an investment action we normally would adjudge to be absolutely asinine.
Not this time, however. As you may have ascertained, it's got us so antsy, we're alliterating.
But we'll stop now. We know it gets annoying.
Israel-based SodaStream announced Tuesday it will kick off its 2013 global ad campaign during Super Bowl XLVII by showing an updated version of its ad titled "The SodaStream Effect." The spot, which highlights SodaStream's sustainability benefit by showing scenes of soda bottles suddenly disappearing, was yanked from transmission prior to air last week in the U.K. by Clearcast, the British version of the
, for being harmful to the likes of
"The majority decided that the ad could be seen to tell people not to go to supermarkets and buy soft drinks, instead help to save the environment by buying a SodaStream. We thought it was denigration of the bottled drinks market," reasoned Clearcast.
Balderdash! Baloney! Pure knuckle-headed nonsense! (Oops, sorry.)
Seriously, what a ridiculous reason for censoring an absolutely innocuous ad. All Clearcast did -- aside from making Brits wonder if their regulators are in the pockets of the beverage giants -- is turn the commercial into a
sensation that has now garnered more than 1.2 million views. And now SodaStream is using that leverage to introduce its products to another 100 million viewers during the world's biggest football game slash media event.
"Our commitment to invest in the Super Bowl is in line with our broader efforts to significantly increase our market penetration in the U.S. and globally," said Daniel Birnbaum, CEO of SodaStream.
Bully for you Birnbaum! We here at the
back your battle against those bowdlerizing bastards ... even if our exhortations do err on the side of exasperating!
3. Zynga Steps Out
should call its newest game
following its divorce from
The online gaming company saw its stock sink around 6% last Friday -- and then another 10% this past Monday -- after it amended a 2010 deal that gave Zynga privileged status on Mark Zuckerberg's massive social network. Under the new agreement, Zynga will get greater independence to promote its standalone Web site, while Facebook will be free to fool around with new and different game developers.
And Facebook isn't the only one stepping out on Zynga. The company also saw senior executives Roy Sehgal and Steve Schreck take off this week. The pair follow in the footsteps of a slew of Zynga brass to recently say
, including Zynga's former CFO, Dave Wehner, who walked out last month.
OK. Maybe it's not truly a divorce since the two parties are still somewhat entangled. How about we refer to it as a trial separation instead? Open marriage? Facebook friends with benefits?
Whatever you call it, both sides are breaking their original vow and are testing the field. And judging by the reactions in their stocks, investors clearly seem to think Facebook is in a better position to go it alone, and we tend to agree with the herd on this point. Shares in Facebook jumped Monday to nearly $29, continuing their strong run from their 52-week low of $17.55, even as Zynga's stock, now down 75% since last year's high-profile IPO, swung lower on the news.
Wait! That's it! We know what we'll call these swinging singles from now on.
2. McMoRan's Monkey Business
Just when its high-profile Davy Jones well was turning into the second coming of Al Capone's vault -- loads of hype, lots of drilling, lack of treasure --
hit a gusher Wednesday when
Freeport-McMoRan Copper & Gold
purchased the company for $14.75 per share, or $2.1 billion.
energy analyst Joseph Allman about the company's jackpot, though. He has zero to say on the matter. Literally.
Check this out: In the week prior to Freeport's purchase, shares of McMoRan had lost more than a third of their value, sinking below $8 a share, after the New Orleans-based E&P player revealed that it repeatedly failed in its efforts to test the Davy Jones well in the Gulf of Mexico. On Monday, the beleaguered driller said in a press release it had "limited success" using a solvent to dissolve the barite which has been blocking the natural gas well for months. McMoRan added that it may inject more solvent using a propellant stimulant gun to unclog the perforations and would "provide updates as flow-testing operations progress."
In other words, after years of digging an ultra-deep well in super-shallow water, McMoRan had nothing to show for its efforts and nothing left to tell the press.
Things got so bad, in fact, that some analysts, like JPMorgan's Joseph Allman, began questioning whether the wildcatter had sufficient cash to survive the Davy Jones debacle.
"We estimate that the company needs to raise over $500 MM in 1Q13, based on NYMEX futures prices. The combination of valuation, operational uncertainty and apparent financial tightness causes us to maintain our 'underweight' rating," Allman wrote on Monday after the latest bad news came out. Allman added that his price target for the stock was $0 per share.
Oh, brother Allman! Only two days before the company gets bought out for billions, you told your clients that McMoRan was worth zilch. Talk about bad timing!
So what do you have to say for yourself now?
"Due to JPMorgan's involvement in the transaction announced on Dec. 5, 2012, we are suspending our rating and price target for McMoRan Exploration Co. Our prior rating and price target should no longer be relied upon."
How convenient! He buried (metaphorically and financially) investors in Davy Jones' locker and then completely vanished from the scene.
Alas, if only Geraldo Rivera tried the same disappearing trick after his televised Capone vault humiliation, we can only imagine how wonderful the world would look today!
1. More Nasdaq Nonsense
Our good friends at
better not go into the obstetrics business. They surely would make a mess of the delivery room if they did.
The electronic exchange was forced to delay the initial public offering of
on Wednesday after a case of "human error" screwed up its originally scheduled opening. The stock eventually opened for trading late in the day, but not before dredging up bad memories of last May's
fiasco on Nasdaq.
According to a
account, Nasdaq agreed with WhiteHorse and its underwriter to push trading beyond its 11 a.m. takeoff slot. However, some fat-fingered (or fat-headed, we're not sure yet) employee canceled the IPO instead of delaying it by a few minutes. Eventually the stock did open for trading at 3 p.m., but not before Nasdaq needed to annul all the stock's pending orders and replace them with new ones.
Oh, yeah, as for the shares, WhiteHorse priced its stock at $15, and it finished the day's trading -- or should we say, the hour's trading -- at $13.90. The business development company sold 6.67 million shares into the market, raising $100 million.
Not that the stock's actual performance matters, though. Or even the company itself.
You see, Wall Street traders have no problem throwing out the baby with the bathwater. It's the birth mark their superstitious natures won't let them forget.
And, quite sadly, because of Nasdaq's latest foul-up, WhiteHorse is now scarred for life.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.