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Altria (MO): Option Players Betting On Big Announcement

With the Altria board meeting, there is much anticipation that either a huge buyback, dividend increase or the PMI (Phillip morris International) spin will finally be announced. It would appear that option buyers are betting that something is coming soon.

The December 70 strike, in the money by a dollar or so, has seen more than 18,500 contracts change hands today on the long-dated option. Heading into today’s action, this strike was already home to peak open interest in the December call series, with nearly 60,000 open calls in residence.

Several blocks of 1,000 or more contracts have changed hands throughout the trading day. The largest transaction was a block of 2,418 contracts that changed hands at 11:11 a.m., trading off the bid price of $4.50 per contract. Another block of 2,250 contracts was traded at 1:56 p.m. and also traded at its respective bid price, changing hands at $4.30 per option. Given this trend, it is possible that options players are closing their positions.

MO shares have moved marginally higher in today’s trading and are within striking distance of another new all-time peak. Last week, the stock hit a new high of 72, overcoming short-term chart resistance at the 71 level.

This research is from Shaeffer’s Research

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Milwaukee Lead Paint Trial Underway

For those interested in the Lead Paint trials, the City of Milwaukee’s suit against NL Industries (NL) has begun. For the single best day to day converage, there is only one place for you to go…

Visit Jane Genova’s blog Law and More. Jane live-blogged the RI Trial and will present us with the most accurate depiction of events in Milwaukee. I highly advise those interested check out her blog daily.

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Here Comes A Wall St. Sale! Get Ready To Buy

“Wall St. is the only place where when the things people want to buy go on sale, they panic” Warren Buffett.

There was a 6% sell off in China last night and that spread into the European markets overnight. The Chinese government tripled the “stamp tax” on stock trades to 3/10 of 1% in an effort to slow down the wild speculation in their market. The global sell off will undoubtedly hit the US market today. That means if there are stocks you have wanted to buy but were hoping to get them cheaper, today may be your chance. DOW and S&P futures are both negative this morning meaning at least at the open, we are looking at red.

For ValuePlays reader that means we may get the chance to buy Lowe’s(LOW) under $30 like I speculated about yesterday. Maybe I can also buy those Citi (C) shares back at a price cheaper than I foolishly sold them for in January. If you think about it, it was reported Eddie Lampert bought them at around $54 a share, if they dip below that, I can’t think of a reason not to pick them up.

Think about the logic for just a moment. Because the Chinese government raised a tax on stock trades and folks there panicked, there is now a reason to sell US shares? By any measure the US markets is NOT overvalued. Now, you could argue it is fairly or undervalued depending on the metric you want to use but by no measure is it overvalued. That means there is no logical reason for a sell off today. Of course we do know that markets are not logical, right?!?

Altria (MO) will get whacked today if the market does and the logic must be that because Chinese investors have to pay 3/10 of 1% on stock trades now, little Johnny in Newark won’t light up this morning? Uncle Leo who goes through two packs a day will be so distraught at the plight on Chinese investors he will not be able to bring himself to smoke that first Marlboro today? Folks in the US who were going to paint their house this summer and use Sherwin Williams (SHW) paint will just hold off worrying about the poor Chinese investors? Please…………

The Chinese market is up 60% this year and is clearly in a bubble stage. Folks have been saying this for a year now. I mean when Greenspan finally comes around and recognizes the obvious, you know it is a bubble. When you have a market in a bubble, any hiccup causes a wave of fear and then a sell off and this is what you have in China. If anything, fear of a bubble there or its “popping” should cause a “flight to quality” and that is the US market.

Alas it probably will not today and that is just fine with me as it has been a while since we have had a “Wall St. Sales Event”.

Happy buying today…

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Short Increase Leaders: April 13 to May 15

Here are the increase leader for the past month. People who are negative on a stock will sell it short in hopes on buying it back later at a cheaper price. Large positions can lead to a “short squeeze”. This happens when large numbers of short sellers are forced to buy back the stock as it rises, this cause huge buying and usually a dramatic run up in the stock. Here they are:

The number is the increase in the number of shares short (rounded):

CVS (CVS) = + 46,000,000
Valero (VLO) = + 35,000,000
Altria (MO) = +29,000,000
Advanced Micro (AMD) = + 28,000,000
Ishares Russell 2000 (IWM) = + 18,000,000
Regions Financial (RF) = + 17,000,000
Time Warner (TWX) = + 16,000,000
Constellation Brands (STZ) = + 14,000,000
Delta Airlines (DAL) = + 14,000,000
Southwest Airlines (LUV) = + 13,000,000

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Last Week’s Dividend Increases

Here are the Top 10 percentage dividend increases last week

Lowe’s (LOW) = 60%
LMP Capital (SCD) = 40%
Clorox (CLX) = 29%
Monroe Muffler (MNRO) = 28.6%
ARK Restaurants (ARKR)= 25.7%
Omnicom (OMC) = 20%
Assurant (AIZ) = 20%
TansAtlantic Holding (TRH) = 18.5%
SEI Investments (SEIC) = 16.7%
Abington Bancorp (ABBC) = 16.7%

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US Savings Rate: Ignore It

We are always hearing about the negative US Savings Rate and how we are “living on credit”. It is only a matter of time before our bubble bursts and we are plunged into recession / depression or what ever else negative “sion” they can come up with. Let’s just ignore the number you see. Why? The method used to arrive at number we always see, while accurate 50 years ago, in today’s investor economy gives us a false number. Here is how.

Today savings is calculated as:

Income – Federal taxes – Expenditures= Savings

sound easy enough correct? Wrong and here is why.

1- Excludes capital gains

Let’s say I bought 300 shares of Sears Holdings (SHLD) in 2004 for $23 a share spending $6,9000. Wanting to pay for my kids college, I sold them last month for $180 a share pocketing $54,000 or a profit of $47,100.

According to the current savings calculation, that $47,100 is not counted as income..

2- Includes all Federal Taxes

Now, Of that $47,100 I now have to pay 15% long term capitol gains taxes of $7,050. That tax bill is included in the “taxes paid” portion of the saving equation even though the income that generated it was not.

3- Includes the spending of the gain

The remaining $40,050 that is sent to the college, is now counted as an expendtiture in the calculation..

so for what I just illustrated, the income and expenditures and taxes all equal out to zero BUT, for the National Savings Rate, it looks like this:

Income = 0
Federal Taxes = $7050
Expenditures= $ $40,050

This gives me a NEGATIVE savings on this transaction on $41,000 when in reality, it should be zero.

Another factor? 401k’s

How many retired people are getting an income from a 401K? If you are that numbers is NOT being counted as income, BUT the things you buy with it are being counted as expenditures, giving you an artificial negative savings rate.

Own a home? Has it increased in value? The increase in that value is NOT counted as savings either. When you sell it and have a gain you then roll over into another house, you have the same mythical spending with no income from our stock transaction. The money you put down on the new house and the taxes you may pay on the sale of the old are counted as expenditures but the gain on the sale of the old house is not counted as income.

Perhaps this is then reason that even though we have a “negative savings rate” as a nation, our household wealth is at all time highs?

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Lowe’s (LOW): Getting Enticing

This past holiday weekend I was talking to my 4 year olds and they said that they wanted to get another bird feeder for the house. I asked them where they wanted to go and they both said “Lowe’s (LOW)”. Hmmmmm. “What about going to Home Depot (HD)?”, I asked. They replied that they did not want to go to Home Depot, they wanted to go to Lowe’s. “Why?”, I asked. “There is more light and people help us in Lowe’s” they replied. Now, if a four year old feels this way, I am going to guess millions of other folks out there do also.

This comes off news that Lowe’s recently increased it’s market share in 17 of 19 business categories last quarter. They also announced that they are increasing their dividend 60% and, here is a big one, adding $3 billion to their share buyback program. Last quarter Lowe’s repurchased $650 million of shares and could buy more. This is a company that produces over $2.1 billion from operations each quarter and after all it’s capital expenditures, share repurchases, debt reduction, still had a cool $250 million left to add to it’s piggy bank.

The new buyback announcement means they have a total of $3.8 billion worth of stock they are authorized to repurchase. At today’s prices that will take about 119 million shares of the 1.5 billion total or over 7% of off the market. That is a significant amount. The real beauty of this is that is can easily be done over the next year and a half with very little impact on operations or by adding any additional debt.

The dividend. At it’s new level, Lowe’s will yield about 1%. This is poor when you compare it to the over 2% yield from Home Depot. Lowe’s will spend about $450 million over the next 12 months on dividends (depending on the rate of the share buyback) at the new rate and while significantly higher than the $87 million it doled out in 2004, more is needed.

Now, the buyback will help and let’s look at why. Let’s assume for a minute that Lowe’s does not increase the dividend and keeps it at it’s 20 cent annual level. Currently that means they will return $300 million to shareholders at the current 1.5 billion shares outstanding. After the buyback, there will be about 1.38 billion. This means that all thing being equal, Lowe’s would only need to spend $276 million to keep the dividend at its’ current rate. It also means that at the new rate (32 cent a share) they will be spending $441 million vs the $480 million they would have spent without the share buyback. So buybacks help both us shareholders, buy allowing more of a companies profits to be available to us (higher EPS) and allow the company to increase the dividend without a direct dollar for dollar impact. A win -win.

The only thing stopping me from buying share now is the anemic dividend. In a rather mature industry, I would like to see more of a commitment to shareholders here. Lowe’s is kind of a “tweener” in this respect. It is not really a growth company anymore and it does not yield much for potential investors. But, were shares to get hit and dive under $30, they would be very tempting for me. Very tempting

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Bespoke: Great Research

From the site.

“Bespoke Investment Group, LLC applies this same “tailored” concept to financial research with MyBespoke. Until now, customized market analysis has been available only at the institutional level — and at enormous costs. Bespoke has altered the landscape for customized research by allowing anyone — from large institutions to the most modest investor — to receive the specific in-depth analysis they need in a cost efficient and timely manner.”

“Formed in May 2007 by Paul Hickey and Justin Walters, formerly of Birinyi Associates and creators of the acclaimed TickerSense website, Bespoke’s research platform will enable any interested party to gain the data and knowledge necessary to make intelligent and profitable investment decisions. As evidenced by Bespoke’s Think B.I.G. website, users gain access to some of the most original content and intuitive thinking on the Street.Bespoke Investment Group, LLC applies this same “tailored” concept to financial research with MyBespoke.

Until now, customized market analysis has been available only at the institutional level — and at enormous costs. Bespoke has altered the landscape for customized research by allowing anyone — from large institutions to the most modest investor — to receive the specific in-depth analysis they need in a cost efficient and timely manner.Bespoke Investment Group, LLC applies this same “tailored” concept to financial research with MyBespoke.”

I have been receiving the daily emails from Bespoke for a few weeks now and they are good. I like the “Morning Lineup” email. It gives a very concise and informative capsule of the upcoming day and arrives about 8:30 am est. Now, eventually they will begin to charge for this service so the “value” of it will then be determined. I have no idea of any potential pricing so I will not even attempt a guess.

You can go the the site and request a “Sample” and they will email it to you in a pdf format. I suggest you do it as the information is detailed and different that the normal research out there. I specifically enjoy the work they do on sectors and the overall markets and the economy. It is “big picture” items and worth the look.

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Top Stories Month To Date From Value Investing News

Here they are. Please visit George’s site Value Investing News as it has great information from many different sources and is a truly democratic site as registered users vote on stories. There is no webmaster cherry picking going on here. Here are the top 5 for May to date:

1- Sears Holdings: A “Techinical” Look– ValuePlays

2- Financial Blog Watch: Controlled Greed– Radio.wallst.net

3- Monish Parabi 13-F for 3/31/2007– sec.gov

4- Wally Weitz on Berkshire Hathaway and Dell– youtube.com

5- Seth Klarman: World Class Warrior- nytimes.com

Good Reading and have a safe holiday….

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Owens Corning (OC) Insiders & Officers Buying Up Shares

Since Owens Corning (OC) emerged from bankruptcy last October, there have been 19 transactions from corporate officers of shares and all 19 of them have been buys. As Peter Lynch famously said “There are a multitude of reasons insiders sell stock, there is only one reason they buy, they think the price is going up.”

Corporate officers spent $1.9 million of their own funds to pick up over 68,000 shares. The big fish was 10% owner Harbigner Capital Partners, who bought $35 million worth for 1.04 million shares.

Officers:(rounded)

Chairman Mike Thaman- $505,000
CEO David Brown- $505,000
DIR. James McMonagle- $160,000
VP Dean Roy- $65,000
VP Charles Dana- $74,000
VP Brian Chambers $74,000
DIR. Ralph Hake- $93,000
VP Sheree Bargabos- $99,000
VP Joseph High- $50,000
VP David Johns- $74,000
VP Stephen Krull- $74,000
VP Frank OBrien- $50,000
VP Charles Stien- $50,000

I have been recommending Owens since January and am up over 20% so far. It would seem like my enthusiasm is shared by those with the most intimate knowledge of its operations and prospects, management.

Similar to George Soros’s recent purchase of ADM shares seeing folks purchasing a stock you have been invested in does reassure you of your picks and when you are in the stock well before their purchases and at much lower prices, it does bode very well for the future of your investment.

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Dow + DuPont = Drama

Talk about drama. The SEC initiated an investigation into whether or not a senior executive and a board member at Dow Chemical (DOW), both of whom have been fired by the company, secretly attempted to put the company in play, the New York Times reported today. The investigation might also probe Dow’s attempt last autumn to buy DuPont (DD)in a deal worth over $40 billion. At the time, neither company disclosed that Dow had approached DuPont. DuPont turned Dow down, but its stock rose 15% between September and December. The SEC is also examining the unusual trading that resulted from their actions in both companies stocks. Another question that will need to be answered is who at JP Morgan let the “cat out of the bag” to folks who then piled into shares of DuPont or, was it only Krienbeg and Reinhard since it appears JP Morgan was working both deals simultaneously?

Dow says the speculation, and the accompanying stock price spikes, were fueled by the actions of Romeo Kreinberg and J. Pedro Reinhard, who held “multiple meetings” about a takeover. JPMorgan Chase, who was working on the unauthorized takeover proposal of Dow, admits it met with both men. Both executives deny the accusations and have countersued Dow for defamation. Another question that will need to be answered is who at JP Morgan let the “cat out of the bag” to folks who then piled into shares of DuPont or, was it only Krienbeg and Reinhard?

The SEC probe and the lawsuits will hinge on testimony from JPMorgan CEO James Dimon, who told Liveris that Kreinberg and Reinhard had held talks with JP Morgan about a Dow takeover. It would be hard to imaging nobody at JP doing anything wrong after looking at the activity of both companies stocks, so Dimon will essentially have to throw some of his folks to the wolves.

The really big news here is the attempted Dow and DuPont merger. This story is going to have a ton of twists and turns to it in the coming months and ought to keep us occupied in an other wise slow summer. Dow has long coveted Dupont’s seed business an the offer was an attempt to get it. Since that seems to have failed could a Monsanto (MON) joint venture be coming? It would be a way for Dow to get heavily into the seed business and provide Monsanto cheaper building blocks for its products and cash to reinvest in it’s business as it has stated it wants to.

Stay tuned to this one

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Notes From Sherwin Williams (SHW) Investors Conference

On May 22nd. Sherwin Williams (SHW) held an investor conference at the company’s headquarters.

Lead Paint was the first topic: Inside Council Dale Normington addressed the gathering after CEO Chris Connor stated, “While Rhode Island has been a little bit of a hiccup, we think there is a light at the end of the tunnel”

Mr. Normington:

Rhode Island:
“It would seem inappropriate to say, but I do take great pleasure in announcing that after almost 8 years we finally get this out of the hands of the judge who was handling this in Rhode Island and to the Supreme Court. There is no question the court will hear our appeal and that will happen in the next year.” (8 to 10 months)

The appeal will be five parts running concurrently:
1- Contingent fee
2- State is appealing win Arco got
3- state will appeal contempt citation against RI AG
4- Appeal of legal issues by Sherwin
5- Appeal of trial issues by Sherwin

“For those who saw the trial and seen the judge’s opinions”, according to Normington there are a “plethora of issues” both legally (market share, product identification, contingency fee, public nuisance) and from the trial (jury instructions, issues with witnesses, evidentiary rulings and opening and closing arguments and more) to address.

Issue of remedy(Special Master). “There is no plan in place and there will not be one for quite a while.” The scope of any remedy “I can assure you will be thoroughly debated”

Two full days of oral arguments are expected in Q1 of next year and he expects a decision before they adjourn in June 2008.

A “win” is a new trial or a reversal based on legal issues of allowing trial to go forward to begin with.

“Sherwin Williams currently has third party action against landlords and judge has not announced when those trials will go forward”

Ohio:
“Localities heeded the siren call of Motely Rice”

Asking for a Federal Constitutional review of Trade Association (LIA) involvement being a function of free speech. Sherwin is claiming free speech activities cannot be a basis for liability.

“Ohio product liability law prohibits prosecution without product identification and there is no product identification available in lead paint cases” Meaning there is no way to identify the maker of the paint that may have poisoned children. Localities have argued this law does not apply here, Sherwin obviously feels it does. Common sense would lead one to believe it does also.

Federal judge in Ohio will review contingency fee legality. A decision is expected in 30 days.

“If Federal judge rules contingency fee illegal under federal constitutional grounds, we can argue that ruling enjoins all localities from using contingency fee council”

California:
“Judge ruled cities cannot use contingency fee council. Localities may not be able to go forward without contingency fee council”

“Cities have requested a stay pending review”. Judge will rule this week or next on stay request.

The Business:
CEO Connor: “We have lots of opportunities ahead of us”. Perhaps giving insight into future plans for Sherwin, Connor then said, “Our model transports to other regions of the world.”

Paint store expansion has been “very successful” and will continue “for the better part of the decade”.

My takeaway:
Official at Sherwin are actually relieved to be in the appellate process and seem very confident in the direction the lead pain litigation is headed. Why? I guess it may be because when all is said and done, they did nothing wrong and eventually truth and what is right always wins. It may not be easy or quick, but it happens.

The tone of the business talk was one of expansion. Whether it be through the acquisitions of more local dealers to expand the paint stores or international to open more markets, Sherwin is not sitting still. While not specifically stated, it is clear that Sherwin is intent on being the #1 paint and coatings company in the world. They plan to “aggressively pursue” expansion in China and India, markets where the current coatings landscape in very “fragmented” and ripe for consolidation. According to Connor, the companies affirmation of guidance and Q1 share buybacks should illustrate their confidence in both the results and the value of shares.

This is a very exciting time to be a Sherwin shareholder. The company is on the cusp of finally ridding itself of the lead paint albatross and is correctly looking towards the future. I think one will look back at this period of time several years from now and view it as the seminal point in which Sherwin vaulted itself from a huge regional to a huge worldwide presence.

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Credit Suisse Downgrade Of Dow Chemical (DOW): Nonsensical

NEW YORK, May 23 Analysts at Credit Suisse downgrade The Dow Chemical Co (DOW) from “outperform” to “neutral.” The target price is set to $50. In a research report, the analyst Mark Connelly wrote that he likes Dow’s strategy, but sees only moderate upside after speculators recently drove up shares on buyout rumors. He has a $50 price target on the stock, up from $49. He also downgraded the overall major chemicals industry to “Underweight” from “Overweight” on expectations of slowing demand growth. This does not make sense. If you used his numbers, over the next 12 months DOW will return an almost 15% gain to shareholders when you add the 11% share price increasehe expects and the almost 4% dividend DOW will pay to shareholders. How is that bad?

What is it going to “under perform””? The market? Does he think the The Ratings For Sectors

Overweight: Industry expected to outperform the relevant broad market benchmark over the next 12 months.
Market Weight: Industry expected to perform in-line with the relevant broad market benchmark over the next 12 months.
Underweight: Industry expected to underperform the relevant broad market benchmark over the next 12months

Now the Individual Company Ratings

Outperform: The stock’s total return is expected to exceed the industry average* by at least 10-15% (or more, depending on perceived risk) over the next 12 months.
Neutral: The stock’s total return is expected to be in line with the industry average* (range of ±10%) over the next 12 months.
Underperform**: The stock’s total return is expected to underperform the industry average* by 10-15% or more over the next 12 months.

So what do we have? The Chemical sector being downgraded to “under perform” means that is will lag the S&P in 2007. Dow’s neutral rating means that is will match that performance plus or minus 10%. Some math is now necessary. Let’s say S%P advances 10% in 2007. This guy is right and the chemical sector “under performs” and only advances 8%. That means that Dow’s neutral rating means that shares will be between $44 and $53 from their current $45. The more the sector lags the market, the more the downside risk. If the chemical sector only advances 1% in 2007, his expectation is shares will trade between $41 to $50.

Here is the best part: “In an effort to achieve a more balanced distribution of stock ratings, the Firm has requested that analysts maintain at least 15% of their rated coverage universe as Underperform. This guideline is subject to change depending on several factors, including general market conditions.”

Translation? “We have to put a certain number of firm in a category whether they warrant it or not. A depending what the market does, if we are going to look foolish we reserve the right to arbitrarily change that.”

Is anyone getting where i am going with this? He has no idea where shares are going to trade..

Please ignore them…

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Sprint Nextel (S): An "F" In Customer Service

Sprint Nextel(s),the #3 wireless carrier behind AT&T and Verizon was formed by the merger of Sprint and Nextel in 2005 with a stated goal: “Two great traditions of bold innovation have come together in a new company with a clear mission: To be No. 1 in providing a simple, instant, enriching and productive customer experience. Nice tag line but the company is failing at this goal at such a magnitude it makes one wonder if they even realize it is a stated goal. When Sprint bought Nextel they purchased quite possibly the single best wireless carrier at the time. It had an incredibly loyal customer based and it’s “walkie-talkie” feature was at the time the single most significant breakthrough for the average cell user. It allowed people to not use minutes when communicating to each other over the Nextel network. This caused families and businesses in mass to make the switch to Nextel for the cost savings this provided.

Aside from it’s features, what set Nextel apart from every other provider was it’s customer service. It had bar none the best in the industry. When one called customer service at Nextel you left the conversation feeling that they not only valued your business, but were thankful to have it. A call to customer service was actually a satisfying and enjoyable experience. I would actually receive calls from customer service out of the blue thanking me for doing business with them and giving me 100 or 200 free minutes that month to use. The call was not a “make good” due to a problem, it was just a thank you. They would even call me to offer a free upgrade to another phone, just for being a customer. When was the last time a company called you with a freebie that had no strings attached? Their efforts lead to shareholders being handsomely rewarded as the stock climbed from $3 in 2002 to $30 when the merger was announced.

All that changed with the combination of the two companies. A call to customer service today is only slightly less maddening than listening to Palestinians and Israelis argue about “whose fault it is”. The person on the other end not only does not speak English as a first language, I am not even convinced they are vaguely familiar with it. I know what the critics are going to say “you just cannot understand people with an accent”. Aside from not being true, the problem is that they cannot understand me and my dialect is about as vanilla as they come. The most glaring problem? The connection we have always, for lack of a better word… sucks. No matter if I call from my cell phone, home phone, business phone or pay phone the connection is always lousy and Habib and I spent 90% of the conversation asking each other to speak up so we not understand each other more clearly. How can a phone company have a lousy connection?

Another recent experience in which I attempted to switch from the Nextel to the Sprint network entailed 3 trips to the Sprint store (because the people at customer service in Bangladesh told me to go there, which was wrong), a phone delivered two days late to the wrong address and 1 hour on the phone trying to actually place the order. I could have refinanced the house quicker. The single most infuriating part? Apparently the folks at the Sprint store are not allowed to sell you the phone and switch you to the Sprint network!! Is this one company or not? Now, they can switch me from Verizon or AT&T to either Sprint or Nextel, but not from Nextel to Sprint, okay…. Understand this is two years after the merger.

Now, understand this is not just me, a recent JD Power Survey gave Sprint the lowest grade among the major cell providers for customer service.

The effect of this continued fiasco are felt in an consistent decrease in subscriber growth for the combined company. Sprint has tried to explain this by saying “it has been focusing on higher-quality customers, which has resulted in the losses”. Am I the only one who just cannot see the logic in this argument? If the customer you are going after is resulting in increasing losses, how can they be of “higher quality?” Remember, prior to the merger Nextel was a very profitable company.

Shares, after hitting a high of nearly $27 in July of 2005, current trade at $21. 2006 EPS fell 7% from 2005 and Q1 2007 EPS fell 150% from 2006 levels (6 cent profit to a 3 cent loss). It has been over 2 years and this is clearly not working.

Rather than focusing on “higher quality” customers and ignoring the rest of us, how about focusing on higher quality (or just competant) customer service? It worked wonderfully for Nextel.

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Bio-diesel Producers: Ethiopia Wants You

After reading my post about Brazilian coffee bean producers turning part of their crop into bio-diesel in Forbes, I received the following request. Ethiopia is looking for any way to profit from its coffee crop and is looking for interested parties to look to Africa as a source of Bio-Diesel production.

“Ethiopia is the largest coffee producer in Africa. As a large (population about 75 million) but extremely poor (per capita GNP is the $100/year range) country, there might be interest in biofuels from an available resource. I would be interested in knowing more about this possibility, particularly some idea of capital requirements, required support infrastructure (e.g. reliability of the technology, need for highly skilled personnel, etc.), minimum size/capacity of a viable operation and expected output (gallons/liters of biodiesel).”

“Any of your readers with an interest in the Horn of Africa are welcome to add their email addresses to the list. The focus of the list is political/economic/developmental, with only very occasional items about coffee or biofuels.”

“Shlomo Bachrach”

Any interested parties can email me information and I will forward them to the necessary parties.