stahleyp Posted October 7, 2012 Share Posted October 7, 2012 anyone know how much Whitman owns? From what I see, it's less than 4,000 shares...surely that isn't right, is it? :o Link to comment Share on other sites More sharing options...
mysticdrew Posted October 7, 2012 Share Posted October 7, 2012 anyone know how much Whitman owns? From what I see, it's less than 4,000 shares...surely that isn't right, is it? :o It is... but that's not indicative of her incentives. Her compensation is entirely performance based ($1 salary). She has about 1.9 million options which have a strike of 23.59 plus other performance goal requirements before they become earned. So she's basically working for free until the stock price appreciates significantly and HPQ turns around. Link to comment Share on other sites More sharing options...
stahleyp Posted October 7, 2012 Share Posted October 7, 2012 mystic, thanks for that. I'd feel more comfortable if she thought the stock was so undervalued that she threw some of her $1 billion+ personal fortune in there though. Link to comment Share on other sites More sharing options...
17thstcapital Posted October 7, 2012 Share Posted October 7, 2012 anyone know how much Whitman owns? From what I see, it's less than 4,000 shares...surely that isn't right, is it? :o It is... but that's not indicative of her incentives. Her compensation is entirely performance based ($1 salary). She has about 1.9 million options which have a strike of 23.59 plus other performance goal requirements before they become earned. So she's basically working for free until the stock price appreciates significantly and HPQ turns around. I would expect those options to be repriced at the end of the year and/or a new set of options granted with a much lower strike price. Link to comment Share on other sites More sharing options...
boilermaker75 Posted October 7, 2012 Share Posted October 7, 2012 mystic, thanks for that. I'd feel more comfortable if she thought the stock was so undervalued that she threw some of her $1 billion+ personal fortune in there though. Wouldn't that be great if a CEO would come in and say you don't have to pay me. I will buy the stock here and my compensation will be the appreciating in the stock because of my CEO skills. That would go a long way for me to wanting to be a co-owner with that CEO. Link to comment Share on other sites More sharing options...
mysticdrew Posted October 7, 2012 Share Posted October 7, 2012 mystic, thanks for that. I'd feel more comfortable if she thought the stock was so undervalued that she threw some of her $1 billion+ personal fortune in there though. Wouldn't that be great if a CEO would come in and say you don't have to pay me. I will buy the stock here and my compensation will be the appreciating in the stock because of my CEO skills. That would go a long way for me to wanting to be a co-owner with that CEO. It would be be great, but then again she could be off enjoying her billion dollars instead of working for free and being demonized in the press and by employees... Link to comment Share on other sites More sharing options...
stahleyp Posted October 8, 2012 Share Posted October 8, 2012 mystic, thanks for that. I'd feel more comfortable if she thought the stock was so undervalued that she threw some of her $1 billion+ personal fortune in there though. Wouldn't that be great if a CEO would come in and say you don't have to pay me. I will buy the stock here and my compensation will be the appreciating in the stock because of my CEO skills. That would go a long way for me to wanting to be a co-owner with that CEO. It would be be great, but then again she could be off enjoying her billion dollars instead of working for free and being demonized in the press and by employees... Why does she do it then? It's not like she founded the company and has some attachment to it, ya know? Link to comment Share on other sites More sharing options...
Guest rimm_never_sleeps Posted October 8, 2012 Share Posted October 8, 2012 yes she could sit home and enjoy being a billionaire. but she turned out to be quite the ambitious young lady taking this job. it remains to be seen what HP shareholders would prefer her to do. she's hardly working for free. even if she was working for zero comp, her time has option value as CEO of HP. however she has none of her own skin in the game. as ceo of HPQ with a long term contract it only stands to reason she is going to be granted a lot of options at low prices. I guarantee she is going to come out of this with a package that makes Bloomberg columnists go "hmmmmmm". Link to comment Share on other sites More sharing options...
Evolveus Posted October 8, 2012 Share Posted October 8, 2012 mystic, thanks for that. I'd feel more comfortable if she thought the stock was so undervalued that she threw some of her $1 billion+ personal fortune in there though. Wouldn't that be great if a CEO would come in and say you don't have to pay me. I will buy the stock here and my compensation will be the appreciating in the stock because of my CEO skills. That would go a long way for me to wanting to be a co-owner with that CEO. I agree that would be awesome. Harris Kupperman at Mongolia Growth Group recently did just that. No options, just a personal money (around $5m I think) to purchase stock/found the company. No salary, just paid on stock appreciation. Link to comment Share on other sites More sharing options...
vinod1 Posted October 8, 2012 Share Posted October 8, 2012 yes she could sit home and enjoy being a billionaire. but she turned out to be quite the ambitious young lady taking this job. it remains to be seen what HP shareholders would prefer her to do. she's hardly working for free. even if she was working for zero comp, her time has option value as CEO of HP. however she has none of her own skin in the game. as ceo of HPQ with a long term contract it only stands to reason she is going to be granted a lot of options at low prices. I guarantee she is going to come out of this with a package that makes Bloomberg columnists go "hmmmmmm". I would also add that since she is already very wealthy, this is just a fun outing for her. Trying to turn around a highly regarded icon of the computer industry and also just being the CEO and everything that goes with it. She seems semi-incompetent, has set expectations of a turnaround for 2016 (4+ Years) so she has laid the ground work for her to provide reasons for why there is no improvement or more bad news for that extended period. All her actions and talk seem to be what a person would do if one is not sure they would be able to turnaround the company. Vinod Link to comment Share on other sites More sharing options...
kevin4u2 Posted November 5, 2012 Share Posted November 5, 2012 Any thoughts on this Ralph V Whitworth guy? Sounds like a value investor(from wikipedia) and he has invested over 400 million into HPQ this year. He is also on the BOD for HPQ. http://www.dataroma.com/m/ins/ins.php?t=y&rid=1052622 Link to comment Share on other sites More sharing options...
bathtime Posted November 14, 2012 Share Posted November 14, 2012 Klarman sold around half his HPQ position: http://www.gurufocus.com/news/197133/seth-klarman-buys-rovi-corp-novagold-idenix-pharmaceuticals-sells-hewlettpackard-microsoft-and-hess Link to comment Share on other sites More sharing options...
mysticdrew Posted November 14, 2012 Share Posted November 14, 2012 Klarman sold around half his HPQ position: http://www.gurufocus.com/news/197133/seth-klarman-buys-rovi-corp-novagold-idenix-pharmaceuticals-sells-hewlettpackard-microsoft-and-hess He seems to add and reduce his HPQ position quite frequently. Must be more to his position in HPQ. Guessing some sort of hedge involved. Link to comment Share on other sites More sharing options...
bobp Posted November 20, 2012 Share Posted November 20, 2012 Reading HP news this morning about a 5 billion writedown of Autonomy, I found Jim Chanos making a bear case back in July. "Chanos also touched on how instead of giving cash back to shareholders, companies will make value-destroying acquisitions. He cited HPQ's buy of Autonomy last year." Looks like he hit the nail on the head with that one. Link to comment Share on other sites More sharing options...
VAL9000 Posted November 20, 2012 Share Posted November 20, 2012 Reading HP news this morning about a 5 billion writedown of Autonomy, I found Jim Chanos making a bear case back in July. "Chanos also touched on how instead of giving cash back to shareholders, companies will make value-destroying acquisitions. He cited HPQ's buy of Autonomy last year." Looks like he hit the nail on the head with that one. I agree with the outcome, but I don't think that Chanos was forecasting fraud at Autonomy. It's one thing to say that an acquisition is value destroying because the price paid exceeds the value bought. It's another thing entirely to destroy value by being duped in an acquisition. Autonomy was probably a bad deal even if the numbers were real (hence 3.8bn of the write-down), but it's a terrible deal due to the juiced numbers (5bn of the write-down). What's astounding to me (well maybe not, because this seems to happen so often), is that the acquisition team wasn't smart enough to figure out that half the company was invented. You'd think with $10bn on the line, these jokers would really hunker down and run the numbers. I guess due diligence ain't what it ought to be. Link to comment Share on other sites More sharing options...
Guest hellsten Posted November 20, 2012 Share Posted November 20, 2012 http://h30261.www3.hp.com/phoenix.zhtml?c=71087&p=irol-newsArticle&ID=1760639&highlight= Full year fiscal 2012 non-GAAP diluted earnings per share of $4.05, within the previously provided outlook of $4.05 to $4.07 Full year fiscal 2012 GAAP loss per share of $6.41 Full year fiscal 2012 net revenue of $120.4 billion, down 5% from the prior-year period and down 4% when adjusted for the effects of currency Fourth quarter non-GAAP diluted earnings per share of $1.16, down 1% from the prior-year period Fourth quarter GAAP loss per share of $3.49 Fourth quarter net revenue of $30.0 billion, down 7% from the prior-year period and down 4% when adjusted for the effects of currency Cash flow from operations of $4.1 billion, up 69% from the prior-year period Returned $384 million in cash to shareholders in the form of dividends and share repurchases Fourth quarter and full year fiscal 2012 results include a non-cash goodwill and intangible asset impairment charge of $8.8 billion relating to the Autonomy business within the Software segment Down ~14% today. Didn't the market already know that Autonomy isn't worth more than perhaps a few hundred million dollars? Link to comment Share on other sites More sharing options...
Palantir Posted November 20, 2012 Share Posted November 20, 2012 This deal was very widely criticized at the time as well. Autonomy's growth was in large part due to acquisitions and not the super high growth rate Leo made it out to be. The market should have discounted it immediately. Hence, I think this is really an overreaction, and may actually indicate a buying opportunity. Link to comment Share on other sites More sharing options...
Guest rimm_never_sleeps Posted November 20, 2012 Share Posted November 20, 2012 http://h30261.www3.hp.com/phoenix.zhtml?c=71087&p=irol-newsArticle&ID=1760639&highlight= Full year fiscal 2012 non-GAAP diluted earnings per share of $4.05, within the previously provided outlook of $4.05 to $4.07 Full year fiscal 2012 GAAP loss per share of $6.41 Full year fiscal 2012 net revenue of $120.4 billion, down 5% from the prior-year period and down 4% when adjusted for the effects of currency Fourth quarter non-GAAP diluted earnings per share of $1.16, down 1% from the prior-year period Fourth quarter GAAP loss per share of $3.49 Fourth quarter net revenue of $30.0 billion, down 7% from the prior-year period and down 4% when adjusted for the effects of currency Cash flow from operations of $4.1 billion, up 69% from the prior-year period Returned $384 million in cash to shareholders in the form of dividends and share repurchases Fourth quarter and full year fiscal 2012 results include a non-cash goodwill and intangible asset impairment charge of $8.8 billion relating to the Autonomy business within the Software segment Down ~14% today. Didn't the market already know that Autonomy isn't worth more than perhaps a few hundred million dollars? the stock is down today because hpq lowered estimates for next quarter but maintained them for the next year. that's usually a trick that investors find suspect. Link to comment Share on other sites More sharing options...
fareastwarriors Posted November 20, 2012 Share Posted November 20, 2012 Is anybody catching the falling knife? At some price, there has to be some value in the "franchise." Link to comment Share on other sites More sharing options...
tooskinneejs Posted November 20, 2012 Share Posted November 20, 2012 Hewlett Packard is saying there was massive fraud at Autonomy, but yet they aren't restating their financial statements to correct the irregularities? Something is strange here. I understand the write off of goodwill and identifiable intangibles that resulted from the acquisition, but presumably the fraud would have impacted Autonomy's reported revenues and/or expenses and, therefore, net income. And yet, we hear nothing about a restatement of consolidated results for this matter. If the amounts involved were immaterial, that could explain the lack of a restatement. But then that would mean HP management is falsely attributing the write off of goodwill and identiable intangibles to the immaterial fraud rather than to overpayment for Autonomy. Any thoughts? Link to comment Share on other sites More sharing options...
infinitee00 Posted November 20, 2012 Share Posted November 20, 2012 I agree with the outcome, but I don't think that Chanos was forecasting fraud at Autonomy. It's one thing to say that an acquisition is value destroying because the price paid exceeds the value bought. It's another thing entirely to destroy value by being duped in an acquisition. Even though Chanos did not call it a fraud outright, his firm did publish a report pointing out highly suspect marketing and accounting practices. http://www.cnbc.com/id/49901000 I know many on this board do not like Chanos ( and shorts in general) due to their emotional attachment to FFH (and EBIX, OSTK etc) but I have to give him credit for pointing out the issues with Autonomy and HP's acquisition before anyone else ( or anyone as high profile as him). Issues which even someone like Klarman did not see. I guess w.r.t HP it's Chanos :1, Klarman : 0 . Kidding of course ;) Link to comment Share on other sites More sharing options...
Parsad Posted November 20, 2012 Share Posted November 20, 2012 I agree with the outcome, but I don't think that Chanos was forecasting fraud at Autonomy. It's one thing to say that an acquisition is value destroying because the price paid exceeds the value bought. It's another thing entirely to destroy value by being duped in an acquisition. Even though Chanos did not call it a fraud outright, his firm did publish a report pointing out highly suspect marketing and accounting practices. http://www.cnbc.com/id/49901000 I know many on this board do not like Chanos ( and shorts in general) due to their emotional attachment to FFH (and EBIX, OSTK etc) but I have to give him credit for pointing out the issues with Autonomy and HP's acquisition before anyone else ( or anyone as high profile as him). Issues which even someone like Klarman did not see. I guess w.r.t HP it's Chanos :1, Klarman : 0 . Kidding of course ;) I don't have a problem with Chanos being a short, or even attacking companies I own...that doesn't bother me. The way they approach it does. Getting reports earlier than the public, hiring detectives, using captive journalists, setting up hostile/libelous websites, moving the stock price by feeding other hedge fund managers, etc. Longs are guilty of such shenanigans as well, and I don't care for those types either. Cheers! Link to comment Share on other sites More sharing options...
ERICOPOLY Posted November 20, 2012 Share Posted November 20, 2012 Founder of Autonomy said this today: The figures are just mad. You are talking about handing them an asset worth $12 billion and they are saying $9 billion of that they are taking off. That would be such an obvious massive thing with 300 people and all these firms doing due diligence, how could you possibly not spot it? http://blogs.wsj.com/digits/2012/11/20/qa-with-autonomy-founder-mike-lynch-on-h-p-allegations/?mod=yahoo_hs Link to comment Share on other sites More sharing options...
alwaysinvert Posted November 20, 2012 Share Posted November 20, 2012 Cleaning house to make way for a greater bounce in the eventual turnaround, I guess. Classic CEOing. Has the upside of paving way for even more guilt to be put on former management, too. Maybe Whitman realized that she wants to keep the out of taking another job if this doesn't work out. If it works out, she gets all the credit. If not, she takes none (or very little) of the blame. I'm just not very interested in HPQ when those dynamics are at work. Michael Dell is betting his whole legacy AND has lots of skin in the game on the downside. Link to comment Share on other sites More sharing options...
Parsad Posted November 20, 2012 Share Posted November 20, 2012 Founder of Autonomy said this today: The figures are just mad. You are talking about handing them an asset worth $12 billion and they are saying $9 billion of that they are taking off. That would be such an obvious massive thing with 300 people and all these firms doing due diligence, how could you possibly not spot it? http://blogs.wsj.com/digits/2012/11/20/qa-with-autonomy-founder-mike-lynch-on-h-p-allegations/?mod=yahoo_hs Is it any surprise that they haven't just plainly said they will proceed with litigation to recover funds that were lost due to fraud. It's $9B in relation to pursuing a case for maximum $100M in litigation...nope! Why is that? I would have to agree that no one wanted to take the blame...accountants and auditors are blaming each other...audit committee is blaming the accountants...CEO and CFO decided to take the pressure off and blame an acquisition. Another winning quarter HP! Cheers! Link to comment Share on other sites More sharing options...
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