If ALU spun off its IP business, a new router deal would help the stock. But since ALU's very successful router business is buried inside of a much larger business that is losing money, these deals don't make much difference. If ALU spun off IP, it would instantly greatly increase our shares' value, perhaps even doubling it, but management won't do that as it needs IP's income to help pay for the rest of the losses. Shareholders interests are secondary at ALU.
I think you are missing the point. This has NEVER been about a contract, a group of contracts, or a lot of contracts.
This is about a company, ALU, that is NOT PROFITABLE. And even though contracts are critical, they in of themselves, do not guarantee that ALU will be profitable. A lot more has to happen, which is why ALU is in the midst of an extensive restructuring program, which may or may not be successful.
So right now, ALU is projected to lose 13 cents a share in 2013, plus restructuring costs of about $500M....which totals a LOSS of about $800M.
And then we have JNPR, which is expected to make a profit of $1.17 a share in 2013, which is a PROFIT of about $593M.
Literally, a tale of two companies!
Contracts are GREAT...but contracts that do not aggregate to profits, are NOT SO GREAT. And right now, this is where ALU finds itself....in a deep hole....that they hope restructuring will address.
You have failed to recognize that ALU’s earnings in 2012 could have been much higher if not for the impairment charges. ALU has decided to take on a large impairment charges from its legacy products now instead of later so to get the pain over with. Going into 2013 with clean slate there are now signs of definite improvements over its previous Qs in terms of contracts, restructuring, R&D, new products, and strategic goals without having the legacy impairment charges overhangs pass on to future Qs.
I think "YIU" r missing the point!
Revenue is hader to achieve that cost cuts!
Rising revenue need quality staff.
Adapting cost cuts to the demand by rising revenue is the that this market don´t get.
Everybody can cut costs.... even children, housewives and debils...... mark my words!
ALU will do that easily when the time comes and adapted to the aproach.