Activist Turn Up the Heat on Circuit City - Apr 3 2008 1:44PM
A brief update on the Circuit City situation:
Activist investors are turning up the heat on Phil Schoonover and company, noting that CC’s management is touting a $200 million cost initiative as a success even though it cost the company $500 million in gross profits. Considering management’s short-sightedness with respect to being so focused on cutting short-term costs that they ignore the longer term impact on earnings, I can’t see this company surviving if the management team isn’t removed.
The upcoming annual meeting will be very interesting to say the least. If Phil is given the sack and a new management team is installed, I wouldn’t be surprised to see a quick upsurge in the company’s stock.
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