Waiting for Motorola's Drumbeat
It's been 2 weeks since Stu Reed painfully repeated himself and instructed the financial analyst community to expect "a drumbeat", a "cascade", a "wave upon wave" of announcements from the Mobile Devices group. No longer would Motorola be a one-trick pony and ride a hot product until the bitter end (as they did with RAZR recently and StarTAC 10 years ago).
We're waiting for the drumbeat. There has been no news for the last two weeks. Investors are saying: "Let the waves starting crashing down upon us."
Yesterday, in what seemed like the first time in two months, Motorola's stock actually outperformed the S&P500. What was the reason? Cowen upgraded the stock (as well as Nokia's) becuase they didn't think Samsung would be able to meet demand this quarter and Motorola would get a certain amount of "second choice" business. However, Cowen raised questions about Motorola's long-term product competitiveness. Hardly a ringing endorsement.
The stock nevertheless jumped yesterday, but is still trailing the market again today. Investors are tired of this chronic underperformance -- and rightfully so. There was nothing but hope which the company's management was selling at the analyst's meeting.
It's time for some real change at this company. Ed Zander must go and any director with more than 10 years' tenure on the board needs to go as well.
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