Walmart's New Health Food Push: Is It Too Hard to Swallow?
Bonds Are a 'Safe' Investment: A Big Lie Gets Even Bigger.gif){kind=logo}
Ralph Whitworth, the head of Relational Investors, was interviewed on Bloomberg last night. Stocks Whitworth likes are Sprint Nextel Corporation (NYSE: S) and National Semiconductor Corporation (NYSE: NSM).It appears Relational still owns Home Depot Inc (NYSE: HD) where a Relational partner has joined the board. Relational helped force the ousting of former Home Depot CEO Bob Nardelli in January.
What is Whitworth's formula? While he did not explicitly say, it appears he likes companies that generate a lot of cash with underleveraged balance sheets. The combination of which can be used to return cash to shareholders via dividends and share repurchases.
One stock Whitworth said he did not like is Motorola Inc (NYSE: MOT), saying the business is too competitive, citing RAZR phones which sold at one point for $300 now sell for as little as $30.
Whitworth also does not like the auto industry saying it is going the way of the U.S. television manufacturing industry.
Goldman Earnings Sink After Buffett Dividend
Johnson & Johnson's Income Falls 23%
Burberry Shares Leap on Sales Update
Reader Comments (Page 1 of 1)
5-18-2007 @ 8:53PM
RayLanfear said...
Let's see Relational recommends Home Depot and a partner sits on the board. I thought we got rid of those relationships that indicate you scratch my back and I'll scratch yours. Shades of Nardelli,Ken and Grasso still exist there. This stock is going nowhere, until the new CEO, comes to grasp with same store sales and the fact that Lowe's is taking
away their slice of the pie everyday. Need proof,
merely do your own research on Lowes expansion into
Home Depot's territory, Canada, Western USA, etc. Blaming the -7% comp sales on strictly weather does not address the real problems facing Home Depot for years to come. That is Lowes plain and simple.