Wall of Shame: Hayward’s Out, Who’s In?
Web Editor, "Mad Money"
With BP announcing that CEO Tony Hayward would leave the company on Oct. 1, to be replaced by an American, Robert Dudley, Cramer’s Wall of Shame now has an open slot.
The Wall, of course, is Mad Money’s homage to the worst bosses in business. And with Harward gone, Cramer is searching diligently to replace him. But this time, as he did in 2009, he’s giving viewers a chance to weigh in. Over the past couple of weeks, he has put the call out for nominations, and Homegamers have responded in kind, with two men in particular getting an equal amount of votes for worst CEO: AMR’s Gerald Arpey and Microsoft’s Steve Ballmer.
Cramer can’t find much fault with Arpey, though. Sure, his company, the parent of American Airlines, is the worst year-to-date performer of any major airline in 2010. But since the man took over in April 2003, AMR is up 130% versus the S&P 500’s 28% over the same period. Not to mention, he kept AMR out of bankruptcy, which is the main reason the stock is lagging its peers. Their bankruptcies allowed them to deal with their high labor costs, pension deficits and debt-laden balance sheets. But while Cramer wouldn’t recommend the stock, he isn’t going to put Arpey on the Wall given his strong performance.
Ballmer, however, is at least somewhat less defensible. MSFT is down 56% since Stevo took over in January 2000, almost double the S&P 500’s 24% decline over the same period. The company just reported a strong quarter, no doubt, but the stock price has been stagnant for 10 years, virtually flat lining after getting hit by the dot-com collapse. Cramer said Ballmer should be fighting to control new markets, though instead his company has lost its growth to companies like Apple.
Still, there is someone who deserves the open Wall slot even more than Ballmer, Cramer said, and he will reveal that name later this week. Keep watching to find out who it is.
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