1. Backdating to the Future at AdelphiaThis week's nugget from the Adelphia Communications fraud and conspiracy trial: A former employee at the company -- a treasury supervisor who admits concocting a back-dated document and giving it to the company's auditors -- says he didn't do it to be deceptive. "I knew the transactions had not happened, but I did not intend to mislead anybody," the Associated Press quotes James Helms as saying. Instead, said Helms, he helped create phony bank documents to illustrate the movement of debt, acccording to the Associated Press and
2. Take Two on Take-TwoYou ever wonder why stock analysts are paid a lot of money? If you thought it was their ability to accurately forecast a company's prospects, you're wrong. No, we think it's their ability to get out there, day after day, and slog through all the crud that dumb companies throw at you to make an investment case that's plausible. Not necessarily right, just plausible. Which brings us to RBC analyst Stuart Halpern, whom we're feeling kind of sorry for. On Wednesday morning, Halpern reiterated his Top Pick rating and $47 price target on Take-Two Interactive Software ( TTWO). Positive retailer comments about the video-game developer's forthcoming Red Dead Interactive, wrote Halpern, suggested that the title would exceed Wall Street's sales expectations. Projected unit sales for RDR, wrote Halpern, "would likely ensure a very profitable game and be enough to help Take-Two make Q2 and Q3 numbers." So what does Take-Two do within minutes of Halpern's blasting out his report? Why, it chops huge numbers off its revenue and earnings guidance for the aforementioned second quarter, because the release of the aforementioned RDR would be sliding into its fiscal third quarter, which starts May 1.
|Take Some More ... |
... Take-Two shares
Low-fat caramel dipping sauce
3. McDonald's Gets McDefensiveIn a sign of how much abuse McDonald's ( MCD) has to swallow these days, the company said Thursday it's launching a huge campaign to get Americans to lead healthy lifestyles. Europeans? South Americans? You're on your own. Anyway, it's bad news once you have to start shooting for an image implying that people shouldn't go overboard buying what you sell. Go ask Altria ( MO). Or Anheuser-Busch ( BUD). But we have to give McDonald's credit for reframing the issue. The company isn't actually saying you should ease off the large fries in favor of some home cooking. No, that wouldn't be good for same-store sales. (Don't just pull an apple out of your fridge and eat it; no, McDonald's wants you to come in and buy their new Apple Dippers, which come with "low-fat caramel dipping sauce.") The goal of Thursday's initiative is for people to achieve "better food/energy balance in their lives," explains McDonald's. "Food/energy balance is the simple equation of calories in/calories out." Thanks for the help, guys. In the supply-demand equation that determine's McDonald's success, we had no idea that the problem was insufficient demand.