At the one end of the compensation to market cap ratio are relatively small companies that have very highly paid CEOs. At the other are chief executives at large companies who work for more modest sums and are either paid well for extraordinary financial results or have boards that believe that CEOs should not be paid like sultans

Read: America’s Least Valuable CEOs

Also Read: America’s Most Valuable CEOs

Every year, the media come out with lists of American public company CEOs who makes tens of millions of dollars. While some may have earned the money because of phenomenal results, others are paid well despite poor results. Our list of least valuable CEOs is based on chief executives who are paid handsomely, even though they run corporations with modest market caps and sales. Additionally, most of their companies have not done well, either financially or in terms of stock market performance.

Some of the companies on this list are run by founders or large shareholders. These people may well be in a position to have outsized influence over their own pay packages, which puts shareholders in an impossible position to effectively protest compensation. Other CEOs have been hired fairly recently to turn companies around. They have been paid well to take jobs in which they are expected to post great improvement, but they have not done so yet, and may never. .

24/7 Wall St. identified the least valuable CEOs based on executive pay relative to company market cap. We reviewed the market cap and CEO compensation for every S&P 500 company as of Dec. 31, 2011. If a company’s stock performance exceeded that of the S&P 500 Index between December 30th, 2011 and November 12th, 2012 it was excluded. CEOs who joined their companies or were promoted during the year in question have been included for the purpose of our measurements.

These are America’s least valuable CEOs.

Altera Corp. (NASDAQ: ALTR) cut to Hold at Jefferies.

ArcelorMittal (NYSE: MT) cut to Sell at Goldman Sachs.

Dean Foods Co. (NYSE: DF) raised to Outperform at BMO.

General Motors Co. (NYSE: GM) started as Hold at Stifel Nicolaus.

Goodyear Tire & Rubber Co. (NYSE: GT) raised to Buy at Goldman Sachs.

Google Inc. (NASDAQ: GOOG) reiterated Buy and raised target to $875 at Argus.

Hewlett-Packard Co. (NYSE: HPQ) cut to Underperform at Jefferies.

Honeywell International Inc. (NYSE: HON) started as Buy at BofA/ML.

Immunogen Inc. (NASDAQ: IMGN) started as Sell at UBS.

Kansas City Southern (NYSE: KSU) reiterated outperform but raised target to $100 at Credit Suisse.

Maxim Integrated Products Inc. (NASDAQ: MXIM) raised to Buy at Jefferies.

Monsanto Co. (NYSE: MON) raised to Outperform at Wells Fargo.

Navistar International Corp. (NYSE: NAV) named Bear of the Day at Zacks.

OfficeMax Inc. (NYSE: OMX) named Bull of the Day at Zacks.

TripAdvisor Inc. (NASDAQ: TRIP) cut to Sector Perform at RBC.

Validus Holdings Ltd (NYSE: VR) started as Outperform at Credit Suisse.

Xerox Corp. (NYSE: XRX) reiterated Buy with $13 target at Argus.

Yahoo! Inc. (NASDAQ: YHOO) started as Buy with $22 target at Goldman Sachs.

JON C. OGG

Altria Group Inc. (NYSE: MO) raised to Buy with $39 target at Citigroup.

AU Optronics Corp. (NYSE: AUO) raised to Buy at BofA/ML.

AutoNation Inc. (NYSE: AN) raised to Buy at BofA/ML.

Chipotle Mexican Grill Inc. (NYSE: CMG) started as Market Perform a Wells Fargo.

EMC Corp. (NYSE: EMC) started as Buy at Jefferies.

Expedia Inc. (NASDAQ: EXPE) raised to Buy at Deutsche Bank.

Facebook Inc. (NASDAQ: FB) started as Buy at Cantor Fitzgerald.

Goodyear Tire & Rubber Co. (NYSE: GT) cut to Hold at KeyBanc.

Google Inc. (NASDAQ: GOOG) started as Buy at Cantor Fitzgerald.

International Business Machines Corp. (NYSE: IBM) started as Hold at Jefferies.

International Paper Co. (NYSE: IP) raised to Buy at Deutsche Bank.

JCPenney Co. Inc. (NYSE: JCP) named Bear of the Day at Zacks.

LG Display Co. Ltd. (NYSE: LPL) raised to Buy at BofA/ML and cut to Neutral at UBS.

LinkedIn Corp. (NYSE: LNKD) started as Hold at Cantor Fitzgerald.

Mastercard Inc. (NYSE: MA) raised to Buy at Citigroup.

Motorola Solutions Inc. (NYSE: MSI) started as Buy at Goldman Sachs.

Netapp Inc. (NASDAQ: NTAP) started as Hold at Jefferies.

Netflix Inc. (NASDAQ: NFLX) started as Hold at Cantor Fitzgerald.

Vical Inc. (NASDAQ: VICL) started as Buy at Canaccord Genuity.

Yahoo! Inc. (NASDAQ: YHOO) started as Hold at Cantor Fitzgerald.

JON C. OGG

What stands out so oddly is that there have been a whopping 23,000 put option contracts traded in the $11.00 strike prices which expire in September (9/21 to be exact).  This is representative of 2.3 million shares of common stock on a fully leveraged basis and the last trade was around $0.63 per contract. Even if you go out to the January 2013 and the January 2014 put and call contracts you do not see volume of this sort.

On Twitter’s stock search we see that @OptionsRunners said someone is shorting it with expectations of a 25%-ish drop.

We have searched around for other comments and it seems uncovered so far.

The extraordinary items came to $0.27 in per share charges, and a $0.03 gain … so if we trust the company’s extraordinary items we would get a normalized non-GAAP earnings of $0.57 per share, assuming that these items are all truly considered as one-time events. Thomson Reuters was looking for $0.45 EPS and $5.74 billion in sales.

Tire volume was down 9% to 39.2 million. The tire giant now expects that its full-year tire unit volume for 2012 will be approximately 5% to 7% under that of 2011. Chairman and CEO Richard Kramer said, “The long-term industry MegaTrends remain in place. We expect global tire demand to recover and we remain committed to our 2013 target of $1.6 billion in segment operating income.”

Goodyear shares closed ta $10.37 on Monday, and the 52-week range is $8.53 to $16.12. Analysts had a consensus price target of $17.29, without the consideration of the earnings report, and the market cap is currently just over $2.5 billion.

JON C. OGG

Shares of Goodyear Tire & Rubber Co. (NYSE: GT) are up 5.5% at $10.44 so far on the day.  Even Cooper Tire & Rubber Co. (NYSE: CTB) is up 5.1% at $16.95.

One area of concern is that Ford Motor Co. (NYSE: F) is down by 0.2% at $8.94, but that is only about 1% above its 52-week low.  The auto giant recently blamed Europe and slowing Asia for its earnings woes for the rest of 2012.  Apparently drivers are still buying new tires even they might not buy new cars as readily as before.

Is it irony or paradox that a French tire giant would dominate an American tire giant trading trends?  To prove a the point: Michelin shares closed up 8% on the day in local trading in Paris on Friday.

Here are the 5 ADRs from Europe we tracked yesterday which are significantly outperforming.  Maybe it isn’t all bad news out of Europe after all.

JON C. OGG

Akamai Technologies, Inc. (NASDAQ: AKAM) started as Outperform at William Blair.

American International Group Inc. (NYSE: AIG) started as Overweight at Evercore.

AOL Inc. (NYSE: AOL) started as Neutral at Goldman Sachs.

Avago Technologies Ltd. (NASDAQ: AVGO) started as Buy at Canaccord Genuity.

Burger King Worldwide, Inc. (NYSE: BKW) started as Neutral at Credit Suisse.

Chipotle Mexican Grill, Inc. (NYSE: CMG) cut to Hold at Argus.

DeVry, Inc. (NYSE: DV) cut to Neutral at Citigroup; Cut to Perform at Oppenheimer.

FirstEnergy Corp. (NYSE: FE) cut to Hold at Argus.

Fossil, Inc. (NASDAQ: FOSL) cut to Neutral at Piper Jaffray.

Goodyear Tire & Rubber Co. (NYSE: GT) raised to Neutral at Goldman Sachs.

HSN, Inc. (NASDAQ: HSNI) started as Market Perform at Wells Fargo.

InterMune Inc. (NASDAQ: ITMN) cut to Hold at Canaccord Genuity.

MetroPCS Communications, Inc. (NYSE: PCS) raised to Outperform at Macquarie.

NRG Energy, Inc. (NYSE: NRG) cut to Hold at Deutsche Bank.

RailAmerica, Inc. (NYSE: RA) cut to Market Perform at Wells Fargo and cut to Underweight at Morgan Stanley.

RadioShack Corp. (NYSE: RSH) cut to Sell at UBS.

Tesoro Corp. (NYSE: TSO) cut to Neutral at BofA/ML.

Wisconsin Energy Corp. (NYSE: WEC) cut to Sell at Goldman Sachs.

If you enjoyed the top analyst upgrades and downgrades you are invited to join our daily newsletter and you can receive this directly via email in your inbox each morning. We also cover key M&A developments, IPOs, secondary offerings, guru investors and our key special reports. Sign up in the box below.

Your email address

subscribe

terms and conditions

JON C. OGG

The first step in the case will be negotiations with China which can last up to 60 days. If no resolution is reached, a WTO panel may be requested to settle the dispute.

China imposed the duties on US-made vehicles in response to the Obama administration’s decision place a tariff on imports of Chinese-made automobile tires in late 2009. The US imposed a 35% duty on Chinese tires in an effort to cut import quantities and boost job creation at US tire makers like Goodyear Tire & Rubber Co. (NYSE: GT), among others.

Tire imports from China fell, but rose sharply from low-wage countries like Thailand, Indonesia, and Mexico, defeating the job creation aspect of the tariff. About all that happened is that imported tires now cost more.

China’s anti-dumping duties on US-made cars raises the price to Chinese consumers an amount that is nearly equal to the US tariff on Chinese-made tires. Both Ford Motor Co. (NYSE: F) and General Motors Co. (NYSE: GM) have sold more cars in China in 2012 than they did last year, although many of the cars are built in China and are not subject to the added costs.

Paul Ausick

The unofficial closing bells put the DJIA up nearly 24 points to 13,228.24 (0.18%), the NASDAQ rose nearly 19 points (0.61%) to 3,069.20, and the S&P 500 rose 0.24% or more than 3 points to 1,403.37.

There were several analyst upgrades and downgrades today, including Philip Morris International Inc. (NYSE: PM) reiterated as ‘buy’ and target price raised to $94 at Argus; SanDisk Corp. (NASDAQ: SNDK) raised to ‘buy’ at Jefferies; Baidu Inc. (NASDAQ: BIDU) maintained as ‘neutral’ but target price cut at Credit Suisse; Amazon.com Inc. (NASDAQ: AMZN) raised to ‘buy’ at BofA/ML, Nomura, and Goldman Sachs; and Alcatel-Lucent SA (NYSE: ALU) maintained as ‘underperform’ and estimates cut at Jefferies.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Amazon.com is up 15.6% at $226.64; Callaway Golf Co. (NYSE: ELY) is down -14.9% at $5.94 (our coverage here); Clearwire Corp. (NASDAQ: CLWR) is down -2.7% at $1.43; Deckers Outdoor Corp. (NASDAQ: DECK) is down -25.5% at $51.78 after posting a new 52-week low of $51.03 (our coverage here); Weyerhaeuser Corp. (NYSE: WY) is down -0.3% at $20.81 (more coverage here); TransCanada Corp. (NYSE: TRP) is up 0.5% at $44.01; The Goodyear Tire & Rubber Co. (NYSE: GT) is down -5.1% at $11.32; Procter & Gamble Co. (NYSE: PG) is down -4% at $64.18 (our coverage here); Newell Rubbermaid Inc. (NYSE: NWL) is up 3.6% at $18.61; Merck & Co. (NYSE: MRK) is down -0.2% at $38.38; Helen of Troy Ltd. (NASDAQ: HELE) is up 4.4% at $35.33; Ford Motor Co. (NYSE: F) is down -2.1% at $11.62 (our coverage here); and Covidien plc (NYSE: COV) is up 0.5% at $55.32.

Be sure to look at our list of next week’s big earnings.

Other standouts from today include the following stocks:

Chevron Corp. (NYSE: CVX) is up 0.2% at $106.44. The supermajor oil company reported earnings in line, but production was down. More coverage here.

Allscripts Healthcare Solutions Inc. (NASDAQ: MDRX) is down -36% at $10.25 after posting a new 52-week low of $9.00. The healthcare services provider fired its chairman, and the list of woes goes on. More coverage here.

Expedia Inc. (NASDAQ: EXPE) is up 24.4% at $40.59. The Internet travel company posted better-than-expected quarterly results. More coverage here.

Western Digital Corp. (NYSE: WDC) is down -14.2% at $37.83. The disk drive maker had solid earnings, but worries abound about next quarter. More coverage here.

Stay tuned for Monday. We have noted the following events on the schedule (all times Eastern):

• 8:30 a.m. – Personal income and spending
• 9:45 a.m. – Chicago PMI
• 10:30 a.m. – Dallas Fed manufacturing survey
• 11:30 a.m. – 3- and 6-month bill auctions
• 3:00 p.m. – Farm Prices

Your email address

subscribe

terms and conditions

Have a great weekend!

Paul Ausick

The short-only equity ETF saw inflows as well this week as the market was soft earlier in the week, but that will obviously ebb and flow as the markets rise and fall.  The top ten short positions are as follows (largest first): Goodyear Tire & Rubber Co. (NYSE: GT); OpenTable, Inc. (NASDAQ: OPEN); Energizer Holdings Inc. (NYSE: ENR); Rockwell Collins Inc. (NYSE: COL); Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR); Citigroup, Inc. (NYSE: C); Ericsson (NASDAQ: ERIC); Allegheny Technologies Inc. (NYSE: ATI); Best Buy Co. Inc. (NYSE: BBY); and Johnson Controls Inc. (NYSE: JCI).  Without rounding up or down, these top ten short positions account for only 32% to 33% of the entire ETF’s short positions.

Here is the ETF’s philosophy in a nutshell: “The portfolio management team implements a bottom-up, fundamental, research driven security selection process. In selecting short positions, the Fund seeks to identify securities with low earnings quality or aggressive accounting which may be intended on the part of company management to mask operational deterioration and bolster the reported earnings per share over a short time period. In addition, the portfolio management team seeks to identify earnings driven events that may act as a catalyst to the price decline of a security, such as downwards earnings revisions or reduced forward guidance.”

One thing is nearly certain here.  If investors are looking for an ETF product that bets against high valuations or against what may be market aberrations, they may have found their vehicle.

Now, here is the flip-side of this ETF.  There are two sides to every coin.  If you get into a serious bull situation this can lose incredible amounts of money.  Sometimes it is the most troubled stocks which rally the most, and it doesn’t take a rocket scientist to figure out what likely happens to the price of this ETF in that situation.

The ETF’s Net Expense Ratio is currently 3.29% but the fund noted “The Advisor has contractually agreed to keep the Fund’s Total Annual Fund Operating Expenses from exceeding 1.85% for at least a year from the date of the Prospectus. This agreement is limited to the Fund’s direct operating expenses and, therefore, does not apply to “Acquired Fund Fees and Expenses.”  The fee breakdown is as follows per the ETF fact sheet:

• Management Fee 1.50%
• Short Interest Expense 1.44%
• Other Expenses 0.22%
• Acquired Fund Fees 0.13%
• Gross Expense Ratio 3.29%

JON C. OGG