Is Fidelity really worth only $30 billion?
From The Wall Street Journal -- subscribers only
The release of financial ratios by Fidelity Investments as a part of its efforts to raise $750 million of debt is fueling speculation about the value of the firm on the street. Consultants peg Fidelity's value at between $24 billion to $35 billion based on its EBITDA run rate of $2.2 billion. However, Fidelity's EBITDA is probably understated since Ned Johnson is less concerned with gussying up the financials than the heads of publicly traded companies. Fidelity paid $76 million in dividends last year (a modest amount based that comes to 0.32% dividend yield based on the most conservative estimate of the firm's worth). It also spent $500 million on capital improvements. In the MFWire.com's view, the analysts may be missing the bigger picture. Unlike Goldman Sachs and even Merrill Lynch, Fidelity is a retail company that reaches deeply into the homes of the nation's middle class. The closest equivalent is Charles Schwab, which is valued at more than $37 billion today. Yet Fidelity has more assets under management than Schwab, a larger fund supermarket and online brokerage, and its own branch network. Tellingly, Fidelity and Schwab were both able to raise the revenue sharing in their supermarkets to 35 basis points more than a year before Merrill tried the same move. If Fidelity goes public we would expect a market cap well north of $40 billion -- and we are not counting Fidelity's 55% stake in publicly traded Colt Telecom which is worth another $7 billion.

AIM's packaging of a fund
From TheStreet.com -- subscribers only
AIM's press blitz for its Dent Demographics Trend fund is having some impact as TheStreet.com weighs in with a positive take on the fund. AIM recently held a press conference for the fund, which is riding the wave created by Harry Dent, a best-selling author (The Great Boom Ahead and the Roaring 2000's) and believer that demography is destiny in this stock market. Reporters were enticed to the conference with baseballs autographed by AIM's Texas neighbor and Hall-of-Fame hurler Nolan Ryan (in the spirit of full-disclosure, the MFWire.com admits that one of its own snagged an Express penned ball, but it was not this reporter). AIM is clearly leveraging its relationship with Dent to create cheap advertising in the guise of media coverage. Dent also brings the advantage of being a very entertaining public speaker. Last Spring he was the luncheon Keynote at Waterhouse's advisor conference. Judging by the admiring expressions and full-room at the conference, AIM will have little trouble in getting advisors to take a look at the fund. 

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