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If You Prick Tiger Woods, Does FedEx Bleed?


Athlete's surgery wounds sponsor.


Hello from New York where, whatever "life-related" challenges I might be presented with today, at least I'm not FedEx (FDX). In addition to FDX's much publicized earnings warning this morning, it spends millions a year sponsoring the FedEx Cup, golf's nascent season championship. Last year's champion: Tiger Woods, who's now out for the year with a fourth operation on his left knee. Without Tiger, the favorite for this year's FedEx Cup is "Someone Else." In terms of getting a bang for your advertising buck, FedEx would be better off sponsoring the Westminster Dog Show than a year-long golf championship with a point system somewhere between the plot of Indiana Jones and Lehman Brothers' (LEH) balance sheet, in terms of comprehensibility.

Here's what I'm watching while genuinely wishing the very best for the greatest golfer I'll ever see in my lifetime:

  • Speaking of Tiger Woods-sponsoring companies, General Motors (GM) is trading about $15. Near as I can tell, that's the lowest level ever for GM but, in fairness, I could only find a chart that went back 40 years.

  • Focusing on the positive, CarMax (KMX) is only making an 18-month low after missing badly this morning. Beyond just being in the dual business of selling cars and financing, CarMax is getting whacked by the fact that, to the extent it has any appetite for cars, consumers are bidding up new hybrids and dumping SUVs. CarMax is a well-managed operation but it's going to take it a good amount of time to work through this environment.

  • Electronic Arts (ERTS) once again extended it's $25.74 per share bid for Take-Two (TTWO). This extension, the fourth since Electronic Arts' original February offer, expires on July 18th. Electronic Arts' sports franchise games wont be impacted by Tiger's injury any more than NFL Madden was hurt by the broadcaster's retirement but, without a pipeline of new titles, ERTS looks a bit like a Pfiezer-esque (PFE) value-trap for the new generation.

  • Yes, I'm still long Activision (ATVI). It's probably past time to trim the rest of my gains but when I see how poorly the rest of the game industry is playing the marketshare game I can't help but think that ATVI and new partner Vivendi are going to emerge from this console cycle as the new champs.

  • Full moon tonight, Minyans. Use it as an excuse to act accordingly.

  • Someone is going to make a ton of money scooping up regional banks. Alas, that "someone" is likely to be an entity with a Croesus-sized war chest to enable it to withstand the ongoing storm of writedowns and defaults. For those of us who need to invest in either the individual regionals or ETFs like the KRE I think I'd rather fight werewolves in Times Square tonight than dive into the great unknown of the regional banks at this point.

  • Closing with the unambiguously positive, Nike (NKE) is up today and near all-time highs. Nike is bigger than both Tiger and golf as a whole. The Beaverton Big Boys are even bigger than Beijing debacles. They're simply the best and they are everywhere, making NKE an impossible short and a perpetually better than average long idea.

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Position in ATVI.

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