The company has succumb to the pressures of wall street, and they will do whatever it takes to appease them. This will all be over by this time next year, and we can get back to what we’re used to. PSR is not a sustainable business model, just a short term cash grab. Hopefully we’ll have some customers left.
Perfectly stated, @ZHlUQJH-cqa. This should not be happening, not with our current numbers - but shareholders are never satisfied. Which will be our downfall in the end.
I do partly agree with the previous reply, but the hedge fund investors are the ones behind it all. Individual shareholders are only a small part of the problem. The hedge fund investors will buy shares and sit on them. Now when the investors get impatient is where it all takes place. The shares go into a "stale" status, and the company gets involved. The shares don't increase in value, nor do they decrease. Instead the investors then go through a sell off. Now what that does is decrease share price. The company then implements business models/changes like PSR, to increase the market value. This obviously pleases the investors, and therefore continue to sit on the shares. As long as the share price continues an upward trend, the investors will continue to invest in the company. The investors are sitting on millions of shares and collecting dividends. When the price goes up, so do the dividends. Now the shady part is the share buybacks. Any company can buy it's own shares. This keeps the profit margins high, share price high and keeps the corporate numbers as high as possible. When numbers start falling, investor will start a sell off of their shares. This only increases the speed of the downward trend. Once the investors start backing out, it puts the shares into a high risk category and decreases their value. Future investors are far more likely to pursue investments in a low risk category. So in a nutshell, it's only a matter of time before a sell off occurs. With all the cuts and service disruptions the UP is facing now, the question still remains of how bad will it get. This is simply the icing on the cake right now. The departments that have been nearly eliminated won't be there when they're needed. The company simply wont have the assets to maintain a stable company. The company will lose its customers and the rest is obvious.
The c-appy part about it is that when the bottom gets soft and is on the verge of falling out, the shareholders will sell and run with their money, and then UP stock price tanks. More Wallstreet jackals will swoop in and buy UP stock by the tens of thousands, thus creating another cycle of pressure to produce for the shareholder. It's not going to end any time soon....