Place Your Bets
Brainiac Eric Jackson is handicapping the odds on Terry Semel’s eventual successor at Yahoo!
Here are Breakout Performance’s take on the front-runners:
1. Susan Decker: 3 - 2. Positives: Insider; well-respected by most Yahoo!s, well-liked by street. Question Marks: Technical enough?, too ‘analysis paralysis’?, technical vision for company.
2. Dan Rosensweig: 4 - 1. Positives: Insider; technical enough background; COO tenure on the surface makes him first in line. Question Marks: Arrongant?, will the Yahoo!s trust/follow him?, too close to Semel?
3. Steve Berkowitz, SVP at Microsoft: 8 - 1. Positives: Knows search from Ask, MSN experience, relevant industry leadership experience with views of big and small companies, learned from Diller, Gates, Ballmer. Question Marks: Vision for company?, What are the big accomplishments he can point to on his resume.
4. Shona Brown, EVP BD, Google. 10 - 1. Positives: Rhodes Scholar, PhD, McKinseyite, Best-Selling Business Author before coming to Google—i.e., bright!; Been studying/working in this industry for 12 years. Question Marks: Too junior for CEO slot; Why leave when Google’s on a roll?
5. Joanne K. Bradford, new head of MSN: 15 - 1. Positives: Got online Ad religion before anyone else at MSFT, helped turn culture around at MSN, big company experience and ad experience, lives in Bay Area. Question Marks: Seasoned enough for top slot?, could use more time leading major team at MSN.
6. Jonathan Miller, ex-head of AOL: 45 - 1. Positives: Relevant CEO-type experience at Yahoo! competitor; can point to some content innovations and general turnaround of that group; fiercely loved by some ex-employees. Question Marks: Vision?; too slow; could he gain loyalty of Yahoo!s?
7. Jerry Yang, Chief Yahoo!: 50 - 1. Positives: 1 of the co-founders; well-respected; knows the culture; technical vision. Question Marks: Too junior? (37); Does he want it?; What leadership experience does he have to take on this role?
8. Jason Calacanis, ex-AOL: 185 - 1. Positives: Well-known among the Valleywag set; Small & large company experience at Weblogs and AOL. Question Marks: Too young; not ready for prime-time CEO.
9. Marissa Mayer, Google: 10,000 - 1. Positives: Well-known/respected by tech folks. Question Marks: Too junior; little leadership experience.
10. Brad Garlinghouse, Yahoo! VP: No Chance. No board would ever pick him after leaking the memo.
Although Susan Decker might be a fine bet, we are a bit underwhelmed by the candidate pool. Of course, the candidates are probably underwhelmed by 1440.
an assist to Eric Savitz is in order.
Electronic Arts: Buy, Sell or Hold?
UTC is experiencing growing pains.
Private equity investors recently handed us a fat check...and we need to spend it. Sure, we gave ourselves a raise. But additional manpower was necessary to help us meet our new mandate:
Be all things to all people.
Competing with Investment Banks and Hedge Funds for high-priced talent is difficult. UTC compensation packages, though generous, are not in the same league of those offered by Citadel or UBS.
True, our analyst training program is not as rigorous as the one in place at Alger Management. But we plan to fine-tune it. And forget about CFA’s...all we require is a GED, a thirst for knowledge and street smarts. Best of all, we don’t drug test...the labor market is too tight for that kind of nonsense.
Nonetheless, we have expanded our efforts to bring you proprietary, value-added research. We recently dispatched newly hired associate analysts on a field trip to Electronic Arts (ERTS-NASDAQ) to perform a little due diligence. We hope you find their analysis insightful.
Without further ado,
Family Affair
Fred Alger Management was one of the pre-eminent growth shops on Wall Street in the 1970’s, 80’s and 90’s. Run by brothers Fred and David Alger, they established a reputation for hard-core research and kick-ass results. It was perhaps the most dynamic privately-held buyside shop on the Street.
But with offices in the World Trade Center, Alger was devastated on 9/11. Their rebuilding effort was one of the more inspirational stories in the aftermath of the attacks. Although free passes are rare on the Street, they certainly deserved one. Patient clients and ex-employees came together the and re-constituted the firm.
One of their first significant moves post-9/11 was to appoint a Chief Investment Officer.
They say you can never be too rich or too thin. Dan Chung is both. He also married the boss’ daughter. We can’t be certain, but it probably helped him land the CIO post at Alger. He also carries the titles of President and Portfolio Manager. Few people we know have heads large enough to wear so many hats. Thankfully he hired help some time ago…
Brother-in-law Zachary Karabell was a cinch for the job, and a solid hire to boot, although we suspect he would rather spend time in his Ivory Tower than wrestling bulls and bears all day.
Although recent personnel turnover and client defections might not be terribly newsworthy, rumors relating Chung’s iron fisted rule remind us of Jamie Dimon. Is it any wonder that the institutional consultants and advisors who shepherd assets are growing restless?
Running equity funds has turned increasingly specialized over the past decade. Small-Cap Growth managers have distinctly different skill sets from Large-Cap Value folk. Health Care is a world apart from Technology. Generalists, who historically covered any and all, are becoming increasingly rare on the Street.
But Dan did not get that memo.
Technology Funds are apparently his specialty.
But he also runs Alger’s Health Sciences fund.
Hungry for returns? Order up the Alger China U.S. Growth Fund. Very Tasty.
We are not big fans of sector funds...we would rather allocate assets based on market capitalization.
Thank god Dan’s name is on the Large Cap Growth fund.
And the Mid Cap Growth offering.
But his co-manager probably carried him on the Small Cap and Mid Cap Growth Fund.
Dan is a bright guy, but spread a little thin. Hopefully he won’t expand Alger’s fund offerings and fill in the Value and Core style boxes with his picture. True, those strategies are unlikely at the home of “Pure Growth”. But given how much he likes to see his name on funds and his picture on the website, we wouldn’t rule anything out.
Hopefully one or more of the key fund managers who are smoking their benchmarks will come back to work after their bonus checks clear the bank. We would hate to see the lights go out at Alger Management.
Given all they have been through, that would be a shame.
Mr. Potatoe Head Takes Wall Street
Dan Quayle was vice precedent before joyneing Cerberus Capitol. One year ago he said Japanese stoks were very compelling.
Nice try Dan but the S&P dun better.
Good luck with the Dollar General deel.
Dollar General spikes to session high after MergerMarket analyst on CNBC names co as LBO target
As mentioned at 14:42, MergerMarket analyst on CNBC reports that LBO firms are aggressively pursuing DG. Says Bain Capital and Cerberus Capital, among others, are actively looking at DG. Notes that stock weakness has attracted the potentially buyers, recently trading at a 7.5x EBITDA multiple. Says while it’s implied, it is not clear if DG is engaging in any take-private talks. (briefing.com)
