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It's a shame that the one time event of going public dooms a company for perpetuity to being subject to the unreasonable demands of shareholders, so often ironi

It's a shame that the one time event of going public dooms a company for perpetuity to being subject to the unreasonable demands of shareholders, so often ironically resulting in the downfall of the very value that was supposed to rise as a result of said demands.

zimpenfish 13y ago
It's even more ironic that companies which make astounding profits (cf Apple) and largely ignore the whims of shareholders (cf Apple) are constantly berated for this.
bryanlarsen 13y ago
The alternative to diworsification would be share buybacks. That's a way to increase your EPS without having to grow your earnings numbers. Intel's diversification probably has more to do with internalization of the mantra "if you're not growing, you're dying" than pressure from Wall Street.
- PhantomGremlin 13y ago
  I'm in favor of diversification but not diworsification. E.g. when Apple already makes an iPod and an iPhone then it's smart diversification to make an iPad. That gets you growth without needing to resort to share buybacks. Apple's smart growth is much better than the flailing growth that many companies attempt. E.g. Google has search so Microsoft does Bing. Apple has the iPod so Microsoft does the Zune. New products are OK if they are clearly better than what is already out there, but in Microsoft's case they weren't. Contrast with the iPhone. It was IMO clearly better than what was already out there, if for no other reason than Apple refused to be the wireless carriers' bitch. But now even Apple is doing share buybacks, because they're running out of smart diversification ideas. An iWatch wouldn't be big enough to provide meaningful growth. I'm sure they'll eventually do it, but the law of large numbers is no longer on Apple's side. The example I gave of me wanting Intel to become a world class foundry is IMO smart diversification. TSM's market cap is about $93 billion. So, clearly, there's room for competition.

zimpenfish 13y ago

It's even more ironic that companies which make astounding profits (cf Apple) and largely ignore the whims of shareholders (cf Apple) are constantly berated for this.

bryanlarsen 13y ago

The alternative to diworsification would be share buybacks. That's a way to increase your EPS without having to grow your earnings numbers. Intel's diversification probably has more to do with internalization of the mantra "if you're not growing, you're dying" than pressure from Wall Street.

PhantomGremlin 13y ago
I'm in favor of diversification but not diworsification. E.g. when Apple already makes an iPod and an iPhone then it's smart diversification to make an iPad. That gets you growth without needing to resort to share buybacks. Apple's smart growth is much better than the flailing growth that many companies attempt. E.g. Google has search so Microsoft does Bing. Apple has the iPod so Microsoft does the Zune. New products are OK if they are clearly better than what is already out there, but in Microsoft's case they weren't. Contrast with the iPhone. It was IMO clearly better than what was already out there, if for no other reason than Apple refused to be the wireless carriers' bitch. But now even Apple is doing share buybacks, because they're running out of smart diversification ideas. An iWatch wouldn't be big enough to provide meaningful growth. I'm sure they'll eventually do it, but the law of large numbers is no longer on Apple's side. The example I gave of me wanting Intel to become a world class foundry is IMO smart diversification. TSM's market cap is about $93 billion. So, clearly, there's room for competition.