Joe, >>>>This may be one reason the stock isn't taking off.
what do you think the reason was for Pfizer to take off
after missing<<<
My Pfizer story (mostly OFF TOPIC).
Pfizer. Nothing fundamental about them, just my take on some
analysts' opinions that came out about their quarter. The guy next
office to me owns some PFE (wife inherited), so I hear a lot about
it. The other night he was lamenting as they tanked when their (missed) earnings came out. The next day, everything was all rosy again, as
they recovered it all, and more. Office neighbor found a couple
analysts articles on why their qtr came up short. Maybe the stock
recovered as investors read those "reasons"? I kind of compared
the way PFE's earnings were handled, to the way Intel's were, and
concluded that one is the most "pampered" of stocks, and the other
the most censored. Guess which is which?
Pfizer article #1 excuse by analyst. Well, seems they hired 1,100
salespeople during the year to go out and peddle Viagra and all
their other new drugs. These added headcount had to be paid, for
some reason, and blew the marketing, G&A budget. My take on
this (basically the same as for the next analyst's lame excuse):
didn't they see this coming (need for more salesmen)? Obviously,
Viagra was years in development. When they saw it getting close,
probably last year, didn't they provide for many more sales folks
when doing the 1998 budget, which got prepared in 1997? Didn't
they then provide guidance to the analysts about the increased
headcount costs and to the bottom line? Don't they do long range
planning (LRP, 5 to 10 years or so)? No provision in the LRP for
this? Finally, hardest to believe and most improbable in this story
is: even a company the size of Pfizer would be hard pressed to
bring on board 1,100 good sales people in less than one year. The
hiring process, if you do it right, is extremely time consuming and
taxing on existing employees. Resume gathering and sifting, phone
screening, flying people out, having multiple employees interview
each candidate, meeting with employee screening folks to review
candidates' qualifications, etc., etc., and doing this for multiple
candidates per opening (have to) takes tons of time and gets old
fast. 1,100 sales people hired in 9 months. What a joke. Oh, also,
the job market has been as tight this year as I can remember. IT IS
HARD AS HELL TO FIND GOOD PEOPLE. 1,100?
The second analysts "excuse" was about a big step up in R&D
costs to develop and get the new products out. Again, why wasn't
this budgeted for long before 3Q98?
What if Intel missed their quarter by 9%, as Pfizer did? If the best
excuses/reasons that a couple of "friendly" analysts could come
with were anything like this, I dare say that Intel stock would be
south of $70 right now.
Tony |
