Johnson Controls (JCI) and Goldman Sachs (GS)

Published on December 16, 2008

Johnson Controls (JCI) and Goldman Sachs (GS)

December 16, 2008

Johnson Controls (JCI) said it is withdrawing its 2009 financial guidance due to “the rapid decline in global automotive production and uncertain industry conditions.” It paints pretty bad picture for the automotive industry for both US and Europe.  Johnson Controls issued financial guidance on Oct. 14 that was based on 2009 assumptions of 12.3 million vehicles in North America and 21.2 million in Europe. The company’s latest production estimates for 2009 are 9.3 million units in North America and 16.2 million units in Europe.

For those, who don’t know, Johnson Controls, Inc. provides automotive interiors, products and services that optimize energy usage in buildings and batteries for automobiles and hybrid electric vehicles, along with related systems engineering, marketing and service expertise.

One of the remaining two pillars of Wall Street, Goldman Sachs (GS) posted a big loss for its fourth quarter, its first quarterly loss since becoming a public company in 1999. For the quarter, Goldman reported a loss of $4.97 per share, a full $1.24 worse than the First Call consensus that called for a loss of $3.73. Net revenues were negative $1.58 billion and the company’s net loss was $2.12 billion. GS is trading higher.

What remains to be seen is if it will remain the same “Gold”man as it used to be, after converting into a bank holding and coming under govt supervision. Banks doesn’t pay as big bucks as an investment holding (generally speaking) and therefore whether the so called “talent” will stay (current times are different as there may not an option available) to churn gold for its shareholders.

Profitable Trading, OP

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