John and Amy,
John, Thank you for posting James J. Cramer's "This Game Isn't Personal". Although, I am not a fan of Cramer, I found his article to be close to the reality I knew, and his description of what motivates analysts to make an unpopular recommendation, fairly accurate. As the Sell Side computer analyst for EFHutton Inc. in the mid 70’s, I also tried to be the first with information on the companies I followed. However, more important than being first, I believed, was to make the right analysis and interpretation of the information. If an analyst could be the first to uncover facts about a company and then interpret those facts accurately, he/she would be rewarded handsomely.... But God forbid, the analyst came to a wrong conclusion, or worse, miss-stated the facts, and that analyst was out looking for a new job soon after. It is true as they say, being an analyst is extremely competitive and you are only as good as your last report.
I was never pressured by my company to slant reports. It never dawned on me, as many poster here on SI believe, that analysts yield to pressure from their company to favor that company's "big boy" clients. Although, EFHutton did try to leverage favorable analyst reports, with companies they hoped would be Investment Banking or underwriting clients I never felt any undo attempt to influence my reports.
As an Investor today, I also believe I know the rules of the game. And just as Cramer reported, buy side analysts, portfolio managers, and I, look for misperceptions or misstatement of facts by influential analysts. After the dust settles and the price still reflects the misperception, I look to take the contrary point of view and profit from the short term misinterpretation. Thus, I look to buy on undeserved dips and short on over exaggerated buy recommendations.
By the end of Tom Kurlak’s career with ML, I thought, (and posted here many times), that I believed Tom was intentionally stretching the truth to fit the "grand stand" position he wished to put out. And although it took longer than I had hoped, eventually others realized Tom's proclivity for slanting the facts to support his false conclusions. In recent years, and admittedly I do not see all his reports, I think Drew Peck of Cowan & Co., often goes out of his way to slant facts negatively, when it comes to INTC. (i.e. his complete misinterpretation of the Via situation is only the most recent example).
Last week, as Cramer and Amy opined, and I also believe, Jonathan Joseph and his assistant picked the wrong time to try to make a name for themselves and predicted the end of the semiconductor boom within six months or so. Unlike Amy though, I do fault Jon for not having the facts to support that conclusion.
John, I know you know what I am talking about. Like many of the posters here on this thread, we learned how we could profit from Tom Kurlak’s misperceptions.... And now that Tom is gone, I am learning how to gain from Drew’s exaggerated reports, but now, "Here comes Jonny"
Best Regards,
Jules |
