Kodak's lack of direction and management continues to amaze. And not just us. Now they have been dropped from the Dow Jones Industrial Average, where it has been a Dow component since 1930:
http://money.cnn.com/2004/04/01/markets/dow/index.htm?cnn=yes
George Eastman must surely be spinning in his grave. I'm ashamed for Carp.
Bruce Watson
Ilford, Fuji, Afga, etc. are not in the Dow, nor have they ever been. Should we be less impressed with them? The Dow is mearly an investment mechanism created by Charles Dow (late 1800's) as a means to provide liquidity in a fairly non-liquid market (at the time). Don't know what originially motivated George Eastman, but he might not have given a rip about this.
The only trouble with doin' nothing is you can't tell when you get caught up
Ilford, Fuji and Agfa are not american founded and managed companies. While inclusion in the DJIA does not guarantee a succesful company, it is a measure of prestige, stability and an indication of a probable good investment. If I had the money I would buy Verizon, and short sell Kodak.
My wife is a co-owner of a small financial firm, and after a few drinks we get into some pretty interesting discussions as to the role and value of the stock market in current financial times. Seems like a lot people equate the stock market performance to the economy. Problem is, a company like Amazon who has barely made a dime of profit in it's existence has had stock performance that exceeds a company like Boeing, who is the top exporter in the US and has profits in the $100's of millions. Expectation is the name of the game, so what is it that we expect out of Kodak? From what I can tell in this forum, if they still made Azo (in mass), SuperXX (or whatever the old standard film was), dye-sublimation materials, etc. and sold them at reasonable prices no one would care if they existed on the Dow or Nasdaq, or whatever. If everybody bought a bunch of Kodak stock, then the preception would be that the company was doing well, and then the anxiety to change the company's focus (e.g. dump analog products) might go away. Or is it that Kodak believes that digital (they are very near the top in digital investment, if not at the top) is superior to analog and they feel we should move toward digital anyhow? And to close this obtuse diatribe, why does Budweiser advertise their product during the Holidays (aka Christmas) using a horse-driven sleigh (and most likely the sleigh driver has a buggy whip) instead of the latest SUV? Nostalgia? The desire for more simple times? Who knows, and probably, who cares...
It is interesting isn't it. All the complaints we hear on these forums about Kodak, dropped products and so on. If they had stuck with products that weren't profitable they most likely would have a much lower stock price. On the flip side if they had spent tons of money over the last few years hyping some sort of whiz bang vaporware product with release date that keeps getting pushed out farther and farther the company might have a stock price that was climbing steadily. Never mind the lack of profits or the huge debt amassed in that promotion, the stock price would be high. The whole dot.com stock fiasco of the late 90's proved that stock price has nothing to do with sound businesses.
The Dow is doing nothing more than confirming that the general concensus is that Kodak has not successfully convinced the financial markets that they have a clue to their future. As Paul said, it is all in the general perception of investor confidence in the form of a flow of money (or the lack thereof). Make no mistake about it, there is considerable value in being in the Dow mix (ie. Dow based mutual funds) and this will be very painfull for Kodak. However, it does not have to be fatal if the investors get the message and avail themselves of the source of the condition - management.
Am I concerned about Kodak products in the future? Absolutely not. With great film from Efke or Ilford and some time and materials affording me the capability to mix my own chemistry in the highly unlikely event that they fold their tent it would not necessarily be fatal for the future of large format image making.
Only fools invest in a Dow index. The long-term risk-adjusted return of the Dow Jones is close to zero, and in some years negative. Where is the prestige in that?
Only fools invest in a Dow index. The long-term risk-adjusted (for volatility and cost of carry) return of the Dow Jones is close to zero, and in some years negative. Where is the prestige in that? One is hardly paid enough to hold on to such an index.
Who said that you had to be intelligent to invest in equities?
Maybe when they get rid of Kodak, AT&T and International Paper the performance of the Dow composite will be more than something to joke about. In any event, I let my hedge fund manager make these decisions on my behalf and he knows how to take advantage of weaknesses as well as strengths in the market.
Cheers!
Dow Index covers 30 members, no more. When market trends change, so does the Dow. If you want to recognize that you need to make room for it. Someone had to drop out. Most shareholders have not been happy with Kodak's market performance so for some this is yet another blow. As usual, stock market blows things out of proportion and it may take time for Kodak to gain some ground. I'm only a partial fan of Kodak's products, but will continue to enjoy what I do like while I can. I'd prefer to focus on photography and give support to all of those who make it possible by purchasing their products. The fact that Dow "gurus" dropped Kodak has for me no effect on Kodak's image.
Is this still a photography forum?
Witold
simplest solutions are usually the most difficult ...
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