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That's speculation. They've done better than the NASDAQ, but how do you know they couldn't have done better without the memo being sent out?
by j_baker 16y ago
That's speculation. They've done better than the NASDAQ, but how do you know they couldn't have done better without the memo being sent out?
- dionidium 16y agoOf course you're right, but that's a pretty high standard to hold him to. You'd have to say the same thing about CEOs who behave in a way you support, too. ("Yeah, their stock improved after he started treating employees with respect, but how do you know they couldn't have done better without that change in behavior?")
- j_baker 16y agoI think the moral of the story is that stock prices are a pretty bad way to gauge employee morale.
- tygorius 16y agoWell, here's one clue from Google Finance's weekly price data: in the three weeks before he sent the memo the price had dropped from $29.407 to $21.063 - a 28% drop. Oddly enough, the 3/23 Friday close of $17 (just after the memo went public) marked the bottom of that stock decline. A month later the stock closed up at $21.55. Generally speaking, warm fuzzy bosses don't mean spit to a stock's price, while layoffs can sometimes improve it. The perception that a division's managers are ineffectual, however, could hurt a lot. The story that a CEO was starting to kick managerial ass could improve investor's assessment of the company's chances. Certainly the price data supports the argument that the CEO's actions stopped the price erosion.