When we read new reports about the sell-side analyst dropping coverage of semiconductor capital equipment maker Altera Corp. (NASD:ALTR), our first reaction was to turn the page. Wells Fargo analyst Tad LaFountain III was essentially throwing a tantrum over being denied "access to management," thus we yawned. But when the management of ALTR subsequently apologized to the spurned Sell-Sider, we thought better of our indifference.

For the record, we never talk to the management of companies that we profile and, indeed, feel that "access to management" violates Regulation FD, thus, to us, LaFountain's decision to drop coverage seemed silly and the company's apology even dumber. In August 2000, the Securities and Exchange Commission adopted Regulation FD to curb the practice of selective disclosure of material nonpublic information.

The Reg FD rule reads as follows: "Whenever an issuer, or any person acting on its behalf, discloses any material nonpublic information regarding that issuer or its securities to [certain enumerated persons], the issuer shall make public disclosure of that information... simultaneously, in the case of an intentional disclosure; and... promptly, in the case of a non-intentional disclosure."

Corporate managers are not employed to bring clarity to their public disclosure by according special "access" to Sell Side analysts. They are employed to maximize the company's stock price and otherwise look after the interests of shareholders, especially those shareholders who are employed by mutual and hedge funds.

Since all of a company's public communication is governed by Reg FD, how can any corporate manager communicate any meaningful information to any Sell Side analyst that is not already disclosed via the company's filings with the SEC? The answer is that Sell Side analysts and their brethren on the Buy Side pander to corporate managers in the hope that superior "access" - bilateral telephone conversations, dinners, trips to Thailand -- will allow them to gain some new data point or insight, thereby enabling them to extract higher rents for their research.

In our view, the only reason that a Sell Side analyst wants "access" to a company's managers is so that he or she can obtain information about a company that has not already been disclosed to the public. Meaning no offense, but is there any other reason to talk to these people?

If the management of ALTR had any cajones, they would not talk to any analysts at all. And if Mr. LaFountain and other resident analysts on the Sell Side really had client's interests at heart, they would not waste time talking to corporate managers and focus their valuable energies on true research. Should SEC Chairman Tom Cox seek a juicy new bone to work on, potential violations of Reg FD by financial professionals with "access" looks like a good place to start.

We believe that analysts would do their clients greater service if they shunned cozy chats with corporate mavens and instead focused on 1) financial statement analysis and 2) channel research. The latter is especially relevant regarding the semiconductor capital equipment sector, where no manager has any visibility and the veteran channel researchers rule the data roost. The irony of the Altera situation in particular is that even if the analyst has the precious access to the company's management, the manager still can't tell you anything truly meaningful.

The semiconductor capital equipment sector is among the most treacherous and unpredictable industries we can imagine, as witnessed by the fact that ALTR's revenues and net income have still not recovered from the 2000-2001 New Economy collapse, when business volumes across the industry were cut in half or worse. All of ALTR's major financial metrics improved in 2004, but 2006 may be another story.

A summary business stress overview profile of ALTR from the IRA Corporate Monitor follows below.

IRA Corporate Monitor:  Altera Corp (NYSE:ALTR)
Items:	2004/12	2003/12	2002/12	2001/12	2000/12
Solvency Analysis	SOLVENT	SOLVENT	SOLVENT	SOLVENT	SOLVENT
Debt Service Analysis	SURPLUS	SURPLUS	SURPLUS	SURPLUS	SURPLUS
Asset Quality Analysis	STABLE	GROWING	DECLINING	DECLINING	DECLINING
ROA Profile	IMPROVE	IMPROVE	IMPROVE	DEGRADE	IMPROVE
Earnings per Share	UPTURN	UPTURN	UPTURN	DOWNTURN	UPTURN
Shareholder Value Added	UPTURN	DOWNTURN	UPTURN	DOWNTURN	DOWNTURN
Gross Profit Margin	STABLE	STABLE	UPTURN	STABLE	STABLE
Sales Growth Analysis	STABLE	STABLE	UNSTABLE	STABLE	STABLE
Z-Score Assessment	OK	OK	OK	OK	OK

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