The Nerd Taint Is Even Stronger Than Imagined

by Johnny Debacle

Last year, we highlighted the deleterious effect on shareholders’ value of having a nerd as CEO of a publicly traded company. The case we presented was Sharper Image (NYSE: SHRP) and we recommended a buy based on the fact that the company should rise to its nerd-free valuation of $20 per share.

In light of the fact that the company’s stock has now fallen a further 95% from its former levels and the company today filed for bankruptcy, we are updating our models to appropriately reflect the lingering effects that the taint of a nerd leaves on a company. Previously, we believed that this taint would not present a hairy problem and that it was a problem that would easily be excised. In this we were mistaken — the taint of a nerd CEO runs deeper and darker than even we could have anticipated.

Recommendation: We maintain our position that there is an activist shareholder opportunity in finding companies whose CEOs are avid LARPers or who live in an exact replica of the Borg’s ship. We effectively tweaked our model such that the previous implied taint lag is 40% longer and we have great confidence in using it to invest your money.

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POSTED: 02/20/08 1:04 PM
Comment (103)


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Comments

  1. bob
    February 20th, 2008 | 3:52 pm

    This post is disturbing 🙂

  2. wow
    February 21st, 2008 | 9:07 am

    your banner ads are gone. what does this mean for my dividend?

  3. Mr Juggles
    February 21st, 2008 | 9:29 am

    When did they go? Is nothing showing up at all? I’m still seeing them…

  4. Meglatonk
    February 21st, 2008 | 2:00 pm

    Ads are still there. And THANK GOD! I am counting on next quarter’s dividend to buy this bitchin War Hammer for the next LARPer convention.

    http://www.larp-store.com/Merchant2/merchant.mvc?Screen=PROD&Product_Code=FD-A0606-1&Category_Code=ETH-FD-HFT

    Meglatonk Rules Your FACE!

  5. PBateman
    February 21st, 2008 | 3:52 pm

    I think the reason the Nerd taint is long-lasting is due to their lack of the Full Extension. If nerds would properly know how to drink their Mike’s Hard Lemonade then the taint lag would be shorter.

  6. Size
    February 21st, 2008 | 9:48 pm

    Nerd taint. Now the problem with the Fed is suddenly clear to me.

  7. Mr Juggles
    February 22nd, 2008 | 8:46 am

    Now now, let’s not confuse Nerd Taint, with Randian Taint.

  8. Size
    February 22nd, 2008 | 10:56 am

    Randian taint? T’ain’t Randian. Randian would be no Fed t’all, no?

  9. Anal_yst
    February 22nd, 2008 | 12:10 pm

    Juggles, do you guys have a proprietary screen for Nerd executives that we can get on Bloomberg, etc? Methinks you need to monetize your research