By
Wouldn't that be nice! J.P. Morgan has announced several new media alliances recently. First, they set up Morgan Online, a Web-based private client service for millionaire investors. Then last week they announced the formation of LabMorgan, a business development unit that plans to spend a billion bucks developing electronic finance ventures both within the company and without. Got a plan for a service that pays parking tickets electronically? The line forms here. Today, they announced that they will be joining Bonds.Hub, a private network that allows brokerages to share bond prices electronically.
But then I saw another news story. This one quoted Douglas A. Warner III, chairman, saying that earnings were "excellent," way ahead of last year's fourth quarter. When I checked the price again (expecting to see an even bigger jump -- ever the sucker), the price had dropped three bucks per share. It bounced back and ended the day up $5 15/16, but what logic has a company dropping when earnings are up?
Yikes! People actually read these news stories and trade on them all day long. Not me. I haven't got the guts.
That's one of the main attractions about mechanical investing strategies like the Foolish Four. Such day-to-day news is just not in the formula. But it is fun to see what our companies are doing, as long as you don't look too closely.
There was some interesting news at Kodak <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EK)") else Response.Write("(NYSE: EK)") end if %> today. It's the kind that could have a long-term effect. The company announced stock option grants for its non-management employees worldwide. The company is issuing the right to buy 100 shares of stock in the company at today's price to all non-management, full-time and part-time employees. Way cool. The idea is that employees will feel like owners, which aligns their interests with those of the shareholders. Both will profit if the company's stock rises.
Company President Don Carp described the company's stock as a "terrific buying opportunity," management-speak for "the stock is dying." Whether this is a desperation ploy or a great way to motivate the work force remains to be seen. Let's hope it's the latter.
This is the second widespread option grant that Kodak has issued. A similar option grant two years ago has been of little inspiration to employees so far, at least if the stock's price is any indication. Those employees have the right to buy the stock at its price two years ago. Unfortunately the stock was selling for more then than it is now. Those options vested after two years so right now is about the earliest that an employee could have expected to profit from them. They are good for a 10-year period, though, as are the option grants announced today. I suspect that the work force may not be as thrilled with this plan as management hopes, but certainly putting both workers and shareholders on the same side is a good idea. Neither should benefit at the expense of the other.
General Motors <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: GM)") else Response.Write("(NYSE: GM)") end if %> also announced some news today -- an "alliance" with Fiat that the market apparently found snooze-inducing. GM closed unchanged with fewer than usual shares being traded. Fiat was up 3%.
Astronomy alert! Any of you early risers may want to try and spot the planet Mercury Wednesday morning about half an hour before sunrise. The bright morning "star" Venus will look like it is almost touching Mercury on the morning of March 15. Mercury is a very tough planet to spot since it is only far enough away from the sun to see for a few days a year. Binoculars will help. A very loud alarm clock will also help. I plan to drag myself out of bed for the event, but since LifeMinders doesn't have a bucket-of-ice-water service, I'm not making any promises.
Fool on and prosper!