Duke ( DUK) is on a yo-yo diet. Ever eager to win back Wall Street's faith, Duke has pledged to grow leaner. Indeed, the big energy company has announced major layoffs each of the past two years. But even after shedding thousands of employees, the company has seen its head count barely change. Today, Duke is, in fact, just 5% below its heaviest weight ever. Duke pointed to a big merger in 2002 -- which added more employees than it has managed to trim -- as a reason for its current size. It also indicated that massive asset sales, carried out since that time, have failed to significantly lighten its load. Still, Wall Street is counting on Duke to slash costs -- partially through head count reductions -- as part of a recovery plan being carried out by turnaround CEO Paul Anderson. So far, investors have shown plenty of faith in Anderson's ability to save yet another troubled company. They pushed Duke's stock to a 52-week high the same day that Anderson reassured analysts during an upbeat meeting in February. One analyst, who is bearish on Duke's stock, actually questioned his negative stand after that particular conference. "We walked away from the events with a greater level of confidence that Mr. Anderson has an accurate grasp of what needs to be done to fully get Duke back on its feet," UBS analyst Ronald Barone wrote in early February. "Feeling insecure about our projections given all the upbeat discussion at these meetings, we returned to the office to further update our model." In the end, Barone concluded that his original projections looked accurate and kept his reduce rating and $18 price target on Duke's stock intact. Almost as an aside, he also recalled some company promises in that same research note. "Over the last several years," Barone wrote, "management mentioned that Duke's total head count has been reduced by about 4,000 people, with further reductions coming." But the company's own figures look far less flattering. On Wednesday, Duke added 9 cents, to $22.60.
Duke's Drift Energy giant says it's cutting, but the staff isn't shrinking