Bullet Proof Balance Sheets

While a focus on growth has always been in fashion, the advent of COVID-19 has enhanced the currency of balance sheets.  

I know this because an article I wrote with client Ken Berman of Gorilla Trades quickly generated more than 400,000 page views after we published it on Kiplinger.

The list of 25 companies includes predictable entries like Google, Amazon, Apple, which sport truly amazing balance sheets, but also fly-below-the-radar mid caps like data security firm Fortinet (FTNT), Cognex (CGNX), which develops machine visions systems, biotech’s Incyte (INCY) and Old Dominion Freight Lines (ODFL).  read more

Reminiscing The IPO Market

The unicorns are filing one after another for initial public offerings and the excitement in the IPO market is taking me back to 1982, when I was working at a publication called Going Public: The IPO Reporter, the pre eminent journal tracking initial public offerings.

I joined the staff in late 1982, and the total tally of IPOs for the year was something like 300 deals. Then near the end of the year, a well placed venture capitalist predicted that next year’s haul would be something like 600 deals. read more

Elon Musk’s Mark Twain Moment

Mark Twain was the pen name of Samuel Clemens. Clemens was a very clever writer. So it should come as no surprise the very name he chose for himself — Mark Twain — would be steeped in mystery and uncertainty.

Since time immemorial sailors have marked the depth of by throwing a weight in the water at the end of a sounding rope with knots every 6 feet. The second knot was known as the twain, and it marked 12 feet, the minimum amount of water the paddle boats during Twain’s time needed without running aground. So when sailors yelled out ‘mark twain!’ for the captain, it was a moment of uncertainty. Was the boat moving into deeper, safer waters, or was it heading into shallower dangerous waters? read more

Innumeracy Hurts

Innumeracy — the numerical version of illiteracy — hurts.  It hurts more because unscrupulous parties use it to paint a convincing picture that is at odds with reality. Discourse, opposition, and needed change can all be suppressed by preying on innumeracy.  To see this in action, consider the case of Walmart back in the spring of 2015.  At the time, the inadequacy of the minimum wage was a raging national debate.  Fast food workers were organizing a walk out.  One after another, corporations were announcing increases in the minimum wages they paid to avoid a social media backlash. read more

When Capitalism Hurts: Amazon and Detroit

When Amazon released its top 20 contenders this morning, I quickly scanned the list — not for my city, Philadelphia — but for Detroit.

I was sad Detroit didn’t make the cut.  It was a bad day for them and a bad day for the country, I thought.

It made me think about all the statements we’ve heard from iconic tech entrepreneurs about the transformative power of technology.  Well, Detroit is a place that needs to be transformed.  Where are these icons now?

To be sure, there’s a business case to exclude Detroit from the final cut.  Amazon said it was looking for a stable and business friendly environment and access to technical talent, probably not Detroit’s strongest suits. read more

And Now, Fake Earnings

With earnings season here once again, and the term fake news ricocheting across social and traditional media, it’s not too great a leap to get to the concept of fake earnings.

Lots of companies present earnings that aren’t really earnings.  For example, in January Intel reported earnings of $10.3 billion, and then adjusted earnings of $13.2 billion, about 30% higher . . . At Google, net income was $4.9 billion but adjusted net income was $6.0 billion or 23% higher . . . Drug maker Celgene reported net income of $2 billion, but also presented investors with adjusted net income of $4.8 billion, 140% higher. read more

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