Joel,
Thank you for your kind words.
can you come over to the CA thread? Now there's a company with a mystery somewhere between its stock price and its performance that's hard to figure.
Ahh... CA... Computer Associates... I know them well, I do, I do. They once saved my butt big time...
As I recall it, about a year ago now, I was into PLAT. I was heavyweighted more in PLAT shares than I should have been, but what the heck. They had great products and great service. I should know. I was among their retail customers.
So I backed up the truck and loaded up, so to speak. Not once, but twice. A sure thing, I thought. What can happen now? And history will bear me out. The stock did indeed rise from the area of $11 to about $32.
And then the roof fell in. We had a CEO that just could not stand prosperity. (As proof I offer up that the CEO lost a bundle of his own money on Boston Chicken franchises, or at least that's the rumor.) No matter how many times he told Wall Street that he was finished with acquisitions, he just had to buy one more itsy-bitsy, teeny-weeny company. Well, one too many of those little buys upset the institutions and analysts, the promise had been broken one time too many, and the stock rapidly sank to single digits.
Woe was us! We PLATters were shell shocked. Most of us watched a good company go down the drain. The CEO made a promise that if he didn't turn the company around in short order, then he would sell it. Yeah, right!
In rides the white knight in the form of CA. They made an offer that was almost triple the current price of the stock. Hell yes, I tendered pretty quickly. I saw a five digit paper loss grow into a 5 digit gain literally overnight.
The rest is history. CA acquired PLAT with very little fanfare, and now it's the CAites that have to deal with acquisition problems.
The moral of the story (if indeed there is a moral) is that my mistake with PLAT was concentrating on the product and ignoring executives/management. Over time, I've come to realize that the single most important factor in making an investment is management. Nothing else is anywhere near as important. Good management can sell a lousy product, and make the customers happy while doing it. But bad management cannot market great products any better than they can sell poor ones. So go with good management every time. JMO, of course.
I'll try to take a look at CA this weekend.
KJC |
