Andy Serwer Commentary:
Street Life by Andy Serwer Column archive
Bet on Disney and Goldman, not GM
Disney is poised to move and Goldman Sachs is an attractive bet ... but GM remains moribund.

NEW YORK (Fortune) - Welcome to the Monday after Super Sunday ...

GM: So Big Wheels' board meets today and at stake is the dividend. GM (Research) pays out $1.1 billion in divies each year and can't really afford it. After all the company lost $8.6 billion last year! Its stock now yields 8.64 percent, or $2 a share, which if it sounds too good to be true, is. Look for the company to slash the dividend in half. Radical! Last time GM cut its dividend was in 1992. Now Kirk Kerkorian is all for this, even though he owns 56 million shares which means he stands to lose $56 million in dividends. Obviously he hopes he'll make up more in stock gains. Maybe he will, maybe he won't. But I wouldn't fish here. I say we have a dead auto company rolling here...

DISNEY: Wow! Bob Iger has been a busy bee, hasn't he? He took over from Michael Eisner last fall and has shown the world pretty quickly how Eisner -- now a talk show host to be -- had boxed this company in. First Iger made peace with dissident shareholders, Roy Disney and Stanley Gold. Then he made a deal with Apple to put ABC shows up on iTunes, which set the stage for his deal to buy Pixar. Today, according to the Wall Street Journal, in a widely anticipated deal DIS (Research) will announce the sale of its radio business to Citadel for some $2.7 billion. Now we aren't talking Radio Disney or ESPN Radio, Disney keeps them. We're talking the old ABC radio stations. Media folks will tell you there isn't much synergy there, and the deal brings in much needed cash. Disney's stock hasn't really responded yet, but I think over time it will.

GOLDMAN SACHS: For the first time, Goldman Sachs is coining more coin from its asset management business than Morgan Stanley. Surprised? Maybe, maybe not. Morgan Stanley (Research) is much better known for its steady-Eddy asset management business than Goldman which is nowadays famous for its proprietary trading biz (or betting the firm's own money)---which is why some liken this blue chip house to a hedge fund. Proprietary trading is sexy and can produce huge gains, but it is also volatile. So it should please Goldman shareholders to know that Bloomberg is reporting that last year for the first time Goldman beat Morgan Stanley in asset management fees, $2.96 billion to $2.91 billion. GS (Research) is up more than 40 percent over the past 12 months. Still the stock only carries a P/E of 12. If you believe in the casino that is the U.S. equity market, then Goldman is like the house. Some folks are leery of brokerage stocks. I don't feel that way at all about this one.

Loose Change: I don't want to sound like a whiny-butt, (I really don't), and I WAS rooting for the Steelers, but didn't the Seahawks get ripped off all over the place last night? As in bad calls, ref! ... And I have an idea for a business. As Google gets more and more and more commercial, wouldn't it be cool if there was a search engine which instead of popping up sponsored sites first, always put the business or company you were looking for first. For instance, if you ever put the name of a hotel in Google, you get a million travel services, not the hotel's website. So in TrueSearch, (let's call it), you would always get the hotel's site first.

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Email Andy Serwer at serwer@fortunemail.com Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.