Alcoa walks point. Does Alcoa attract volatility and hurt shareholders? $AA $VIX


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Alcoa (NYSE:AA) is about to announce quarterlies. It has become the traditional kick off for earnings season. Alcoa is the first major to announce and market pundits start to blog, twitter and spew. They attract a lot more attention than other majors.

In effect they walk point on the jungle trail. The enemy sniper sees them first. The enemy the booby trap gets them first. Alcoa comes into hot contact with the marketplace first. Inadvertently they attract a lot of attention which creates volatility because of their self selected earnings announcement timing.

Are the shareholders well served by this. Probably not. This volatility has nothing to do with the business risk of Alcoa. Why would an investor want to accept the risk?

Note to management. Stop going first. You have no obligation to feed the news cycle and you are probably hurting your investors. So stop it already!

Disclosure: George Gutowski writes from a caveat emptor perspective. I hold not positions in any stocks mentioned in this post. I hath no plans to initiate new positions within the next 72 hours.

Microsoft $MSFT Bings Baidu $BIDU Is Reg FD a Factor #RegFD

Image representing Baidu as depicted in CrunchBase

Image via CrunchBase

Baidu (Nasdaq:BIDU) announces English language search will now be Bing(ed) and not Google(d). No comment from Microsoft (Nasdaq:MSFT). Google just hangs its head in shame. In some ways they are relieved the announcement was made and now it’s over. Terrible having to wait for the other shoe to drop.

Now if it was a really big deal for Google to lose the relationship, it must be a really big deal for Microsoft to pick up this particular set of marbles. Both Baidu and Microsoft trade on Nasdaq and must play be SEC rules. Something called Reg FD comes to mind.

For Microsoft to not announce anything (at the time of writing there was narry a corporate peep) you need to justify that the development is not material. Even for Microsoft with its huge mega cap status a major China announcement is huge. By declining to comment Microsoft is keeping the details in a black box and investors will be guessing and second guessing ramifications.

It is interesting that Baidu took the effort to announce. So who gets the better of the deal? Read revenue sharing. Is this a work in progress. Just so many questions to ask. It will be like watching newly weds. You know, honeymoon then when the children come along how will they turn out. We can have a really great conversation about nature vs nurture. Microsoft DNA intertwined with Baidu DNA.

In the meantime Google (Nasdaq:GOOG) is hiring lobbyists by the dozen as it learns about the FTC and other agencies.

Disclosure: George Gutowski writes from a caveat emptor perspective. I hold no positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.