Say what you will about Mark Cuban. The entrepreneur was smart enough to cash in his chips at the height of the Internet bubble when he sold broadcast.com to Yahoo! and became a billionaire. From there, he bought the Dallas Mavericks and began torturing us as the NBA's wackiest and most outspoken owner.
Always in love with the camera, tonight Cuban begins coming into our homes on a weekly basis as he debuts as the host of ABC's The Benefactor, yet another inane reality show that promises to get a bunch of egomaniacs together to play silly games and lie and cheat their way to a $1 million prize. Whatever happened to building wealth the old-fashioned way -- like taking a flyer on a hot Internet stock?
In today's Motley Fool Take:
- Would You Buy Any Airline?
- Wanted: Foolish Writers
- All Eyes on Eisner
- Discussion Board of the Day: Disney
- Home Depot Does Urban
- Quote of Note
- More on Fool.com Today
Would You Buy Any Airline?
Will it be Bama Air after all?
For weeks, US Airways
The announcement comes on the heels of the third anniversary of the Sept. 11, 2001, terrorist attacks, a day notable not just for the human cost but too for the havoc it wreaked throughout the American economy. Major airlines, already showing signs of weakness, suffered a mighty blow that day and have yet to see a full recovery. US Airways was a major beneficiary of the federal group formed to aid ailing airlines, securing more than $1 billion in loan guarantees and major employee concessions that cut costs by $1.2 billion annually before exiting bankruptcy in March of last year.
But in the end none of it was enough, and now the carrier is in hock again.
The question now isn't really whether additional relief will help the airline succeed, but who's next? Delta
History suggests Chapter 7 liquidation is the likely next step for US Airways. Indeed, in the '90s there were several airline bankruptcies, with only Continental
Think about it: Would shutting down the nation's seventh-largest carrier really be such a tragedy? On a human level, yes, undoubtedly. The sting of more displaced workers wouldn't be easily sedated. And yet, on paper, US Airways has been a net destroyer of shareholder value for years. The owners -- that is, the shareholders -- have every right to say enough is enough.
Bronner, an investor himself who earned control of US Airways after buying a 37% stake through $240 million from the Alabama state pension fund he runs, might have said it best for investors during the Times interview: "It's a whole lot cheaper for me to have the assets and start over than to have the liabilities."
Painful? Yes. Callous? You bet. True? Yeah, probably.
What do you think? Should US Airways continue to fight or shut off its engines for good? Can anyone make money in the airline business? Will the so-called low-cost carriers be next? Debate all this and more at the Airlines discussion board. Only at Fool.com.
Wanted: Foolish Writers
Do you read the Fool's content and say to yourself, "I could have written that!" Do you post thoughtful arguments on our discussion boards? Do you have an opinion on everything from Amazon.com to Wal-Mart? Then we're looking for you. We're seeking the best and brightest minds out there to contribute to Fool.com. We're taking applications for both full-time positions and freelance Fools. Visit jobs.fool.com and check out the listings under Editorial and Writing.
All Eyes on Eisner
For better or worse, the Michael Eisner era at Disney
By announcing that he will step down in September 2006 in a letter to fellow board members that was made public on Friday, Eisner should be able to pacify the growing group of critics that almost succeeded in voting him out of the company's board earlier this year.
How history reflects back on Eisner's 22 years of Mickey Mouse servitude remains to be seen. The first half of his tenure would have to be classified as one of the better turnaround jobs in corporate history. Along with Frank Wells, who joined him as president, and Jeffrey Katzenberg heading up the feature animation studio, Disney experienced a renaissance through the late 1980s and most of the 1990s as the company's full-length animated flicks flourished and its theme parks recovered by introducing breakthrough attractions to win over the jaded tourist. No matter what harsh words one may have for Eisner -- and I'm sure that many of you do -- he was an invaluable piece of a team that helped save a company on the brink of being acquired by raiders and broken up piecemeal.
Yet after the death of Wells and Katzenberg's departure, the company too proved its mortality. The last few years have seen Disney's ABC network fall from first to fourth in key target audiences, and attendance at Disney's theme parks -- particularly its two newest stateside gated attractions -- has struggled. Its in-house animated features have suffered at the box office, and its once-thriving Disney Store chain is in the process of being gobbled up by rival rug-rat mallrat Children's Place
So what kind of legacy will Eisner ultimately leave? These next two years will be telling. In Eisner's letter last week he alluded to great strides that the company has made in growing. Disney is indeed much larger today than it was when Eisner took over, though large chunks of that growth must be discounted as hefty acquisitions and stock option grants have diluted the 1984 shareholders. At least they are still comfortably ahead. Folks who bought into the company five years ago are sporting a loss on paper.
Eisner justifies the acquisition of Capital Cities/ABC, pegging its analyst value as high as $53.5 billion, though that's a bit delusional. At best, it is not much of a compliment when all of Disney is being valued at only $48 billion by the more efficient stock market (or $57 billion in enterprise value, once you account for the company's leveraged ways). The fact that Comcast
But 2005 will be interesting as the domestic theme parks are prettying themselves up for a celebratory year that should come with a spike in attendance. ABC really has nowhere else to go but up from here in the new fall season. Yes, the company's lucrative pairing with Stock Advisor recommendation Pixar
Who will take his place? Come back on Friday. I will handicap the race for Disney's next CEO by taking a look at the pros and cons of the more likely -- and some unlikely -- suitors.
Discussion Board of the Day: Disney
Were you happy to see Michael Eisner announce that he would be stepping down in 2006? How would you value his performance over the past 20 years? Who do you think should lead the company after he leaves? All this and more -- in the Disney discussion board. Only on Fool.com.
Home Depot Does Urban
One of the skills exhibited by strong, successful companies is the ability to reinvent themselves and to adapt to different situations. Call it flexibility. One could argue that PepsiCo
- Since the store is located in an old, historic building -- the former Hasbro
(NYSE: HAS)building on 23rd Street, near Fifth Avenue -- it won't be slathered in bright orange. Instead, it will have more tasteful orange banners announcing its identity. Inside you'll find elevators, escalators, and an atrium.
- There will be doormen assisting customers in getting purchases into cars and taxis. Shopping carts won't be littered around any large parking lot. Instead, they won't stray far from the building itself and will be managed in-house by a cart escalator.
- Since many New Yorkers own or rent apartments, you won't see aisles full of lumber, weed whackers, hoses, and gutter downspouts. Instead, there will be beefed-up offerings of paint, closet organizing systems, cabinet hardware, stackable washer/dryer combos, and carpets. (Items such as drywall and lumber can be ordered for delivery.)
How is New York reacting to this new arrival? Many would-be shoppers are, of course, thrilled. But many local small businesses, such as hardware stores, locksmiths, and paint purveyors, are justifiably freaking out at the possibility that they'll be put out of business. It's hard to compete with such a big superstore, after all -- one with strong pricing power.
A New York Times article noted that some competitors are keeping their cool: "Dave Glassman, director of marketing for the Restoration Hardware
Look for Home Depot and even main rival Lowe's
Longtime Fool contributor Selena Maranjian owns shares of Home Depot.
Quote of Note
"If I have lost confidence in myself, I have the universe against me." -- Ralph Waldo Emerson
More on Fool.com Today
A dividend strategy is eminently more rewarding than you think, Mathew Emmert says in Extra Dividends, Extra Growth.
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