Quote Originally Posted by copake_ham View Post
Gordon,

I am not talking about financial writers - I am talking about the analysts at Wall Street firms that cover Kodak. Perhaps you are unfamiliar with the analyst's role in the stockmarket? These are industry specialists working at the major underwriting and trading firms. Their analyses and resulting Buy/Sell/Hold recommendations are key advisories to their firm's own trading positions as well as to those firms institutional clients.

If you think these people are just pundits you are very mistaken. They move huge sums of money in the market - and you can bet the farm that public companies are very responsive to their questions and analyses.

BTW: Top level Street analysts often command eight figure incomes; well above the salaries of many of the CEOs of the companies they cover. These are not low-level, green eyeshade number crunchers.

And yes, because many of them advise "specialist" firms which are "buyers of last resort" in making a market in certain stocks in the NYSE - they are very tuned-in to the performance of the companies they cover.

Hello George,

A close friend of mine is an analyst at a very large firm. Perhaps it is better to point out past occurances. At one point not long ago, some analysts suggested breaking up Apple, switching everything to Windows, or halting hardware manufacture to become only a software company. That was a time period when Dell was held up as the model of how a computer company should function. So now here we are a few years later, and market capitalization of Apple is greater than Dell . . . funny how that works out.

Now that is not to say that whatever EK does that might be contrary to analysts suggestions will be the best course, yet it is harder to find companied that swayed to analysts wishes. As much as we badmouth Perez, if he simply did whatever the majority of analysts suggested, I truly believe EK would be gone as a company in only a few quarters.

The reporters are a different matter, and many of them are pundits. It would be the rare reporter that could perform the job of an analyst, or that of a CEO.

The cycle is often buy as many competitors as possible to make your company as close to being a monopoly as governments will allow. Then when the company is too big to function efficiently, sell of the divisions to others, until the company is again small, and can then merge with another company. This starts the cycle over again, though perhaps another name or another company. During all this change, lots of institutional investors are making money on the volatility of the market. Stability is the anti-thesis of potential financial gains.

Analysts are quite good at what they do, but they are not equiped to run manufacturing companies. That should be the point of what I posted. People whose emphasis is financial aspects can make good CFOs, or maybe CEOs of financial institutions. Let financial people call too many shots, then you end up with many of the problems that major auto makers have experienced (or are currently experiencing). Sustainability means more than crunching numbers.

Film generates good profits, and enjoys good profit margins at EK. Obviously at whatever point that was no longer true, then they should close or dump that division. Until that time comes, they need to emphasize the other businesses they now own; Kodak could easily be known as the giant in printing, but they need to change that public perception of being a film company.

Ciao!

Gordon Moat
A G Studio