Because Cramer took yesterday to celebrate Rosh Hashanah – and continue repenting for all those years at his hedge fund as the chair-tossing, computer-smashing boss – he didn’t get a chance to cover this week’s Sell Block until today. The focus? His Hall of Shame.
Cramer’s dislike of Citigroup CEO Chuck Prince is no secret. The Clown Prince’s hapless mistakes put him in the Hall of Shame as far back as March. The latest blunder, according to Cramer, was buying a hedge fund right when the industry was topping. Forget the fact that the fund had “the worst management team I have ever seen,” he said.
But what could the Street expect from a lawyer who was brought in to clean up after former Citigroup boss Sandy Weill was ousted by regulators? At this point, it’s the board of director’s fault for not getting rid of Prince, Cramer said. “Chuck Prince must go,” he said. “The longer he stays the more I question my belief in the existence of the board of directors.”
Cramer’s charitable trust does own the stock, but only because the share price could jump if the board of directors took the initiative to fire Prince; that and the bank’s huge deposit base. Otherwise, Cramer said this stock cannot be owned.
Another Hall of Shamer that should be sold is Vincent Sollitto of Syntax-Brillian. Yesterday alone, the company lost 35% of its value, Cramer said. Like Prince’s tenure, it’s been one flub after another for BRLC. The chief financial officer resigned abruptly, the revenue target was off by $59 million last quarter, and now the maker of LCDs is saying its problems stem from an Asian credit crunch. Cramer was quick to point out that best-of-breed competitor Corning doesn’t seem to be having that problem.
Only someone special could run a company in the midst of a boom and still underperform. Enter Patricia Russo of Alcatel-Lucent . Ciena and Juniper are riding a tremendous wave of telco spending, but ALU is actually seeing its orders shrink. Verizon, to which ALU is levered, is “spending like a drunken sailor,” Cramer said, but still Russo can’t get the job done. The company has lost $11 billion in market cap since she took over.
“These CEOs must go before their stocks really start to work,” Cramer said, “and even then I wouldn’t want Syntax-Brillian or Alcatel-Lucent.”
Jim’s charitable trust owns Citigroup.
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