A few people have been saying they would buy COMPAQ with a change of management. Now's your chance!
First thoughts:
(1) It was sudden without a replacement ready. Having to use an executive search firm for a replacement suggests genuine unpreparedness. The market does not like uncertainty. However, Rosen and his two Director's willigness to take charge will mitigate damage. They will have to issue re-assuring noises tomorrow to counter any rumours about as yet undeclared problems with the 15 cents or anything else. I would have thought the 15 cents was OK, subject to all my previous questions about the use or non-use of tax credits to achieve it.
I think you can rule out completely any worries about funny accounting. Both EP and Mason have a reputation to maintain and Rosen would not have congratulated EP so warmly and spoken of the debt that we all owe if EP left the company in some sort of undisclosed mess.
If there had been funny accoutning, Mason and EP would be better off trying to stay to let the company deal with the law suits. BTW this helps the class actions.
Rosen would have announced any funny business now as the cause of the resignation.
The tone of the comments appear to be, "we have a good strategy, we will stick to it, but we will be more nimble in execution and we will win the confidence of investors".
(2) Mason obviously knew he was going. He had sold his shares in January and got himself a new job. Maybe there is some truth to the theory that since they knew that Mason was going, the company could afford to let the numbers be worse this quarter to favour the future.
(3) Perhaps EP has lost the drive, and acted honourably, knowing that his credibility problem would hold back the company. If he also knew that Mason was going, he might feel that it was too much for him. |
