Pay Package at Risk? Quick, Get Creative

Article Abstract:

Union Pacific promised its executives and some other employees in 2001 a long-term pay package if certain financial goals were achieved by Jan. 31, 2004. These goals included a stock price of $70 per share for 20 consecutive days or if cumulative earnings reached $13.50 a share during the three-year earning period since 2001. When the company failed to achieve this, the board's compensation committee added earnings from its IPO of Overnite Corp. This will change the earnings from $12.92 a share to $14.35 per share, thus allowing the payments to take place. There is concern that the compensation is not really based on overall financial performance by the company.

Railroads, Rail Transportation, Union Pacific Corp., Corporate officers

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New Math Aside, Earnings Still Reign

Article Abstract:

UBS accounting analyst David Bianco has studied the impact of earnings on stock performance. He analyzed the high-performing companies in the Standard & Poor's 500-stock index since 1998 and observed that the highest-ranking ones generated average annual returns of 12.3% compared with the index average of 3.3%. Bianco also noted that companies that use one-time or special charges repeatedly but do not reflect them in their pro-forma earnings distort their true financial strength, and investors should be wary of companies that do not reflect stable, consistent performance.

Corporate Profits, Corporations, Security and Commodity Services, Securities & Commodities Services, Securities, Commodity Contracts, and Other Financial Investments and Related Activities, Labor Distribution by Employer, Economic aspects, Reports, Profit, Profits, Statistics, Securities, Securities industry, Corporate finance, Company financing, Price-earnings ratio, Price earnings ratio, UBS Asset Management Inc., Bianco, David

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Sometimes Investors Should Just Say No

Article Abstract:

Mergers and acquisitions are sometimes a better deal for the executives and corporate directors, than for the stockholders. One major investor believes that the price that Washington Mutual of Seattle has proposed to acquire Providian Financial Corporation is far too low, and is asking other shareholders to reject the offer.

Commercial Banks, Acquisitions & mergers, Management investment, open-end, Management Compensation, Banking industry, Mergers, acquisitions and divestments, Corporate directors, Company acquisition/merger, Company investment, Investments, Executives, Executive compensation, Investor relations, Mutual fund industry, Washington Mutual Inc., Stock rights, Stockholders' preemptive rights, Washington Mutual Inc. Washington Mutual Card Services Div., PVN, Putnam Investments Inc.

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