The value of a company is supposed to be the discounted present value of its expected future cash flows. Actually, the value of a company is the discounted present value of its expected future cash flows. So it follows that a breakup should only create value for shareholders if it increases future cash flows or lowers the discount rate. Most breakups don’t obviously do either.This may seem to border on tautology -- "of course, that's the value of a company" -- but if you follow the business page regularly you'll routinely run into strategies and initiatives that make no sense given this definition. Sometimes these decisions are justified in terms of stock price. Other times, flavor-of-the-day notions like disruption are invoked. Occasionally, there is no excuse at all;
Unless you've logged some time with a few major corporations, you can't imagine how much time and money is wasted on unadulterated bullshit largely because C-level executives lose sight of the obvious.
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