Is Jack Grubman the worst analyst ever?

N.Y.'s Attorney General is going after telecom's $20 million man -- as investors count their losses.

NEW YORK (MONEY Magazine) - Who is to blame when a stock drops? Or an entire sector implodes?

It wouldn't be fair to blame a single individual for such complicated events. But there are situations when one person's contribution is impossible to overlook. And Jack Grubman is such a person.

http://www.businessweek.com/magazine/content/01_25/b3737745.htm
JUNE 18, 2001

IT 100 -- ANALYSTS' PICKS

Jack B. Grubman

Managing Director, Salomon Smith Barney

IT 100 -- ANALYSTS' PICKS

Chris Shilakes

Joseph Osha

Andrew J. Neff

Jack B. Grubman

Gregory Gould

Paul Johnson

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CATEGORY: Telecom services
STOCK PICKS: Worldcom (WCOM), Qwest Communications International (Q), Global Crossing (GX)

Jack Grubman, a fanatical boxing fan and onetime amateur boxer, isn't afraid to lead with his chin. The analyst has been bloodied over the past year as many of his favorite stocks, notably WorldCom Inc. ( ), have been hammered. So what is Grubman recommending these days? Well, WorldCom again tops the list, putting him in the minority of Wall Street analysts who favor the stock. He also likes Qwest Communications International Inc. ( ) and Global Crossing Ltd. ( )

The stocks of many long-distance companies were pounded as competition from new upstarts drove prices down. Now, with many of the upstarts in trouble and the Baby Bells shying away from aggressive price competition as they enter the market, Grubman says prices are stabilizing and it's time to once again cozy up to these stocks. "All the riff-raff is gone," he says.

With more stable prices, WorldCom and other long-distance players should see respectable revenue growth for Internet and data services. Grubman expects WorldCom's revenues will grow 12% to 15% next year, pushing its stock from 18 to 30 within a year. Global Crossing, which has built an extensive international telecom network, should also benefit from stabilization in rising global traffic. At 12 a share, Grubman says it's a "steal" and expects it to more than double in a year.

Qwest is a near-consensus pick among the analysts who follow it. The company boasts steady financials because of its purchase of Baby Bell US West last year. What may push up its revenue growth, Grubman says, is its long-distance network, which is capable of carrying voice and data. He figures the revenue boost should push its stock from 36 to 50 inside of a year.

DEMS GOT $100K FROM GRUBMAN DAY OF SUBPOENA ^
Posted by mhking
On Aug 8
New York Post ^ | 8.7.02 |
By JESSICA SOMMAR
August 7, 2002 -- Embattled former superstar telecom analyst Jack Grubman dropped a $100,000 care package on democrats last month - on the very day he was subpoenaed by House Republicans to appear before lawmakers investigating the WorldCom failure. Salomon Smith Barney's Grubman ponied up the money to the Democratic Senatorial Campaign Committee on June 27, according to the latest monthly report from the committee. . .

www.fortune.com

Global Crossing inflated its revenues by swapping capacity with other carriers, say analysts, and lured customers and investors by overstating the reach and capabilities of its network--a $12 billion "state-of-the-art" system that, several former employees told Fortune, simply doesn't work that well. It exploited its relationships with both Wall Street and its bankers on a scale unrivaled in the industry. "Winnick used to walk around the office saying he owned Jack Grubman and Jimmy Lee," says one former colleague, referring to fees paid to key underwriters at Citigroup's Salomon Smith Barney and J.P. Morgan Chase. A spokesperson for Winnick denies he made such statements.

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