Nautilus cracks down on bearish analyst -- Time to sell?

If I owned shares of Nautilus (NYSE: NLS), I would probably dump them after reading this alarming piece from Herb Greenberg: Eric Wold, a highly-respected analyst at Merriman Curhan Ford & Co says that the company has cut him off from communication after he slapped a sell rating on the stock.

Of course, Nautilus disputes Wold's allegations, and says that the company has not blacklisted him. But it's hard to imagine why Wold would make up such a story, and even harder to picture Nautilus's management admitting to treating an analyst this way. So I'm inclined to believe Wold.

This kind of analyst-bullying at Nautilus is reminiscent of disgraced former Enron CFO Andy Fastow's treatment of analysts. It demonstrates a vindictiveness on the part of the company's management, and a high degree of arrogance. It also suggests that management may be too focused on its stock price and analyst research, when the company should be focused on its struggling business.

Some will probably say that dumping the stock purely based on Greenberg's piece is an overreaction. I disagree. One of the most important factors in analyzing a company is the management, and this raises grave questions about their ethics. The fact that a Nautilus spokesman was most likely dishonest with Greenberg compounds the issue.