Immelt's Promises

Having just failed to deliver on one of his promises (10 percent earnings growth), Jeff Imelt, CEO of GE, is back to making promises (5 percent earnings growth!). I really like Elizabeth Nowicki's take on the matter: "stop making promises". He sounds like an untrustworthy lover in times like these, that thinks more promises is a substitute for promises unkept:

Memo to Immelt:  Earnings do not have to grow each year.  In some markets, in some economies, in some industries, in some “downturns,” simply having earnings – any positive earnings – is a good thing.  Matter of fact, sometimes earnings should NOT be growing each year.   Were I a GE investor, I would not want Immelt promising 5% growth for 2008 because I would figure that the only way he can promise to hit that number in such an uncertain market and gloomy economy is by committing to fudge year-end 2008 numbers if needed.  And, as we learned several years ago, fudging year-end numbers tends to catch up with companies, and, when it does catch up, the valuation fall-out is worse than if the forthright disclosure (e.g. “2008 earnings might be flat”) had been made initially. Am I the only one who remembers back to the not-so-distant past, when unrealistic promises made to analysts by corporate officers led to companies cooking their books at year end to make the numbers?  As I recall, things did not always work out so well in those cases.  Enron, anyone?

Comments

[dr dre beats headphones]

di cui questo individuo cresciuto, lui o lei è diventata anche questa persona preparati su HIS / la sua terra. Parlare della circostanza inquietante, e mai così è stato Halloween. E 'stato prima il tipo di paesaggio orwelliano si può

[ティンバーランド]

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