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Wed 21 Jul, 2004 10:53 am
Martha Stewart's company MSO stock price is now hovering at $11.06 per share when the company has been losing money and their earnings per share is a loss of .359c. Future prospects do not look good; she'll more than likely be spending five months in prison, and advertising revenue of her magazine have been depressed since her conviction. Who is keeping her stock price so high, and why? She lied to government investigators, and still doesn't feel she's done anything wrong. She's in the same class as the hotel magnate, Helmsley, that cheated on her taxes. They seem to be saying they're above the laws of this country; and still people support them. My question is, how come?
I dunno. They have positives to balance out the negatives. The magazine "Martha Stewart Living" is losing ad revenue but "Everyday Food" is increasing market share and ad revenue. Television revenue is also down but mnerchandise revenue is up by an almost equeal amount.
MSO's board has done a pretty good job of holding teh company together through the trial process and I think investors anticipate that things can only get better now that she's been sentenced.
Re: I just don't get it
cicerone imposter wrote:Who is keeping her stock price so high, and why?
Everyone expected her sentence to be at least 200% worse than what she got, and many expected 300%.
The lenient sentence (most lenient possible under law) was a pleasant surprise to investors.
IMO just news-based fluctuation, the stupid kind.
God knows
The devil is supporting the stock. May be American investors are not very bright. May be they are just lazy. May be there is a degree of contrarian thinking involved. May be people want to add spice to their portfolio, kind of see how the criminal fraternity investment can do. I personally think she is not a big fish. After all does a busy exec really have time to worry about losing $10k in stock? I therefore think her company stock my be supported by those who feel quilty for making her a scape goat and to bring to attention to the public the rottenness of corp business world.
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