Eastman Kodak: Even a Skinny Elephant Can't Dance

A streamlining plan will make this former film giant leaner, but it’s not likely to make the stock sing.

Famed Legg Mason fund manager Bill Miller is known for his daring contrarian picks. With impressive reliability, he finds diamonds not just in the rough, but in the rainforest. One of his favorite out-of-favor stocks is Eastman Kodak. Miller told us recently that Kodak's cut-to-the bone restructuring and its new inkjet printer products will double the stock price of the former film giant. The word "former" applies to both "film" and "giant." Film is a buggy-whip technology, and Kodak's payroll will shrink to less than 30,000 by the end of the year. That's half of what it was three years ago, and a fraction of its 145,000 peak in the late 1980s.

Full disclosure: Nobody wishes Kodak well more than I do. I worked for 12 years as a business reporter and editor for the daily newspaper in Rochester, N.Y., Kodak's hometown. While I tried to remain impartial, I couldn't help but root for a company that meant so much to the community where I lived and where many of my friends worked.

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Bob Frick
Senior Editor, Kiplinger's Personal Finance