The following was written by an analyst who has long criticized how Wall Street covers itself. It is published anonymously due to his firm’s legal & compliance rules.
At 9:43 AM ET on CNBC, Dick Bove (Rochdale Securities) said Goldman would pay a fine and this will pass (3:00). He also called the stock an agressive buy at $171 (4:45). At 6:00 minutes Mark Haines begged him to reconsider his position arguing that fraud is a big deal. Bove was undeterred and reiterated his buy recommendation stating a second time this was a short-term issue (7:00).
Then at 6:35 PM ET with the stock at $160.70 ($11 below his aggressive buy recommendation this morning) …
- Bloomberg.com – Goldman Sachs Executives Should Resign, Bove Says
Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein and finance chief David Viniar should resign over fraud allegations, according to Dick Bove, an analyst at Rochdale Securities. “Will Lloyd Blankfein, CEO, and David Viniar, CFO, maintain their positions in the company? I do not think so,” Bove wrote in a note to clients today. “Someone must ‘fall on their swords’ for the devastating decline in this company’s persona and they may be forced to do so for public relations reasons.”
Just six months ago Bove stuck his foot in his mouth by offering instant analysis on Wells Fargo by exciting giving a positive instant reaction to their earnings only to change his opinion to a sell for clients six hours later.
As a result of this embarrassment, Bove told Dow Jones newswires:
“I’m not going to do it anymore. I’m going to have to see the numbers before I go on air,” Bove told Dow Jones Newswires Thursday. “It creates an untenable situation.”
Dick, maybe you should expand your self-imposed gag order beyond numbers and not offer an opinion on a SEC complaint until you actually read it, or at least the three paragraph summary.