DuPont downgrades guidance according to Chair and CEO Ellen Kullman Posture and Position $DD

English: Ellen J. Kullman, Chief Executive Off...

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DuPont (NYSE:DD) issued a CYA press release and talked out of both sides of their mouth at the same time. They downgraded their own guidance blaming more conservative cash management practices by their customers. That mean revenues are off and are expected to stay off for quite some time

Dupont was very gutsy and attributed this quote to their Chair and CEO Ellen Kullman “We are seeing slower growth in certain segments during the fourth quarter, driven by global economic uncertainty. This uncertainty is contributing to ongoing conservative cash management in some supply chains.”

Thank You Ellen Kullman for blaming the economic slow down. What else you got? You know the press release is CYA when the investor relations and public relations contacts do not appear at the bottom for media or investor follow up. You know the press release is CYA because in the future the CEO has been positioned as warning the market about some nasty things that might happen. Unfortunately DuPont has no game and that is the tragedy.

Kullman was a director of General Motors from 2004-2008 but that’s probably another story.

CYA for those of you who do not know is an acronym for “Cover your ass”

George Gutowski writes from a caveat emptor perspective.

DuPont Manages Expectations

Ellen J. Kullman, Chief Executive Officer, DuP...

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DuPont (DD) Chair and CEO Ellen Kullman set up investor expectations until 2015 when she promised Topline growth of 7% and EPS growth of 12%. That of course is classic operation’s leverage as described in most biz schools in one of their introductory courses.

The stock sits at its 52 week high and management needs a way for it to break out. Ellen Kullman was of course speaking at the Bank of America Merrill Lynch Global Industries Conference. The devil will be in the details and every investor call will now listened to in this context.

She has positioned the company as a science-based products and services company. The question becomes is this an industrial company or a high-tech enterprise commanding higher multiples. No discussion or comment about markets. Just a focus on products. I always get worried when the inventors speak to the product and not the solution.

Disclosure: George Gutowski writes from a caveat emptor perspective. I hold no positions in stocks mentioned in this post.