Wednesday, January 8, 2014

Investing according to Scrooge


Heads up: you can't have it all.

The headline indicated "investors" are unhappy that Samsung Electronics gave its workers a big bonus.

The "investors," such as Kyobo Axa Investment Managers and Templeton Emerging Markets Group and IBK Investment & Securities, were willing to complain in public that Samsung has distributed about $1 billion of its $50 billion cash hoard to its 240,000 employees—an average $4,000 each.

These institutional shareholders want a piece of the rock.

That's fair. Samsung, like so many big American corporations, is holding way too much cash—I say "way too much" because the cash isn't doing the company much good; if it can't be invested profitably it should be returned to employees and shareholders.

And the big investment firms are saying just that. I'm in agreement, Samsung could sensibly pay out some of that cash to everyone who owns their stock.

Really, it's just the tone of the carping from Kyobo and Templeton and IBK and the other "investors" who, I suspect, don't care a fig about employee morale at Samsung or the 20-year transformation of the company into  a world-class competitor in the smartphone business.

Kyobo and Templeton and IBK and their buddies just want the cash now, and they're ripped that Samsung employees got some.

Not a noble sentiment.

  




2 comments:

  1. Amazing how you travel from agreeing with the employee bonus and then agree that.. stockholders should get a larger dividend or stock buy back and then with no stats or facts take a swipe at institutional investment. Seems like an unfounded complaint....just saying

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    1. Anonymous missed my point: I wasn't taking a swipe at institutional investment, I was taking a swipe at greedy, insensitive institutional investors.

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