Bernstein's Ferragau is out with a Buy today on Nokia and Ericsson. Has a $10.35 target on Nokia. Not sure what time frame that's for. Typically these are 1 year targets but that sounds a bit aggressive. He also has a 3 year projection of $13.50euro for Nokia. He obviously is assuming a smooth integration of ALU. Looking at both Nokia and ERIC, ERIC is the better buy right now. I own both.
The Nokia– Alcatel-Lucent merger offers, in our view, a great long opportunity. The stocks trade today at 15 times what we consider a 50-cent “baseline” earnings, which corresponds to what the company would earn in 2015 assuming a full realisation of synergies. From this baseline we see a long list of potential upsides: revenue growth, margin expansion driven by the consolidation of the industry, cash return programme, increase in IP licensing revenues. A reasonable bull case, optimistic on all these fronts would drive in our view an EPS of 90 cents and 1 euro of free cash flow in 2019, which would yield a €13.5 stock price in 2018, or a ~25% return p.a. between now and then.
He has a $14.46 price target on Ericsson, a $10.35 price target on Nokia and a $5.69 price target on Alcatel Lucent.
Generally agree with what your saying. But it doesn't appear that WTI is on track to average $50 this Q and certainly NG has been below $3. We still have another month to get there. With 2 x projected coverage there is still ample wiggle room for a slight miss on those price assumptions.
At least it will trade at a price that should attract greater institutional interest. As well, the greatly reduced float should make it more difficult to find shares to Short. But ultimately its shareprice will be mostly determined by the fundamentals. The reverse should be a net positive in time - we'll see.
Farhan in all fairness you were recommending oil stocks when WTI was priced at $50. I warned you at the time we may not have seen a bottom yet. And of course it went into the $30's. No one can predict oil prices with any reliability or consistency. This isn't like recommending Intel at $26. Or Nokia at $6.25. The commodity sector is best left to ones own risk tolerance. Just stop recommending stocks on this board. No one asked you and they're useless recommendations. Go get a Series 7 license and find some clients if you want to have your ego stroked.
Did the suspension of the distribution raise Linn's price? Even after retiring $600M in debt at a 35% discount?? It dropped like a rock. Investors buy MLP's for the income plain and simple. Once a energy MLP eliminates the income component it goes into suspended animation. And drifts downward. You really are mis-guided here. And for someone who owns 80K shares? I thought it was 90K a couple of weeks ago? You sold some didn't you?
Yes if at some point the company was getting close to not covering the distribution they would have to cut or eliminate it. We aren't even close to being there yet. 2.47 x distribution last Q!! Projected at 2+ this Q!!
Oil prices can change on a dime. Just look at what happened today. As I said this needs to be managed on a quarter to quarter basis. At least wait for this quarters numbers for cripes sake. Eliminating the distribution is not to be trifled with unless you are at your last resort.
Most of the BDC sector has been oversold due to fears of interest rate hikes and credit concerns with energy loans. However, a 25 basis point hike isn't going to impact BDC's much if at all. PSEC would actually benefit with rate hike increases 100 basis points.
PSEC's energy holdings are in the 2-3% range. I believe AINV has energy holdings well into double digits and that could be a problem. I also own CPTA and TICC.
As long as you re-invest the dividends while these BDC's trade well under NAV and in the long run you should do fairly well. Nothing wrong with keeping a trading position as well.
Jones you're one of the few voices of reason and rational thinking on this board. Really I can count them on one hand.
Nokia bought ALU with a long term vision. Everything positive Nokia has said is geared toward the 2017-2019 time frame as far as accretive integration and the 5G.build out. These are the catalysts that should move the shareprice into double digits. In the meantime we have the Samsung settlement to look forward to. This will be a brief trading opportunity but won't sustain an upward move out the current trading range. So we're looking at a minimum of 2-4 years. Plan accordingly.
It really doesn't matter much whether Josh is long or short. He brings a wealth of information to this board. Both pro and con. That's what these boards are for.
I can't believe how many silly posts pervade this board; the mindless pumps, the insulting fools, the paranoid conspirators. Nokia hasn't been a great stock. Primarily because it has an over bloated capital structure and in-consistent earnings growth. It will get worse before it gets better. But it's going to take years. In the meantime, the reality is Nokia will be trading in the same $6 - $7.50 range for a couple of more years. My opinion, yours may differ.
Yes if BBEP suspended the distribution the stock would drop to sub $2. But the distribution is running at a 20%+ annual yield. I expected a higher price supported by that distribution. The stock should be at least $4. and not $2.50! The market doesn't trust BBEP because of the Linn blindside.
One reason why Linn eliminated the distribution was they said their stock wasn't being supported by the income anyway. So they took a further hit on shareprice but eliminated $600M in debt.
My other concern right now is BBEP's Q3 estimate of 1.97-2.4 x coverage was based on an average oil price of $50/bbl and Nat Gas at $3.00 MMBtu. Sept is going to have to rise substantially to get to those averages.
As I said, I want to see the Q3 report but right now the hedges should provide enough positive cash flow to keep the distribution in place. It's only $26M/Q
Zach's put out this "gem" today.
During the second-quarter 2015 result announcement, the (BBEP) partnership’s total cost related to its operation came at $115.8 million, almost 40% higher than the April–June 2014 figure of $83.1 million.
Do you know why it was higher? Because Q2-2015 reflects the QRE acquisition!
Nextpoint has made an excellent offer. The TICC BOD has a fiduciary responsibility to accept the offer that is in the best interests of shareholders. That clearly is Nextpoint.
Rmbo, you won't have to wait long. HERE was sold on the cheap to be sure. The division was just starting to come into it's own by generating 25% annualized growth. It was also cash flow positive and growing. You don't sell a unique software business at 1.5 X book with that kind of growth rate. Suri said this was in the best interests of shareholders but never explained why? Why not season the business for another year during HERE's strong growth phase and spin off the business for a potentially far higher return to shareholders?
On a risk/reward basis, the Preferred, because of the extra level of protection, is a better buy than the common right now. The bonds are even better.
SA has been aggressively trying to maintain OPEC market share by driving down prices and forcing the Shale producers to reduce production. So far it hasn't been working. Today's crude inventory build reflects that.
In fact Saudi Arabia has already burned through $62 billion of its foreign currency reserves this year, and has borrowed another $4 billion from local banks in July. It's budget deficit is expected to reach 20% of GDP this year. King Salman and his son are running the show now and I can't see how they can continue this losing strategy much longer. They're borrowing money, running up debt, burning through their cash reserves all while they are fighting and pouring money into a regional war with Iranian backed militant groups. 80% of their revenue comes from oil but at $40-$45 they're losing billions. They need oil at $70-$80 minimum. Only matter of time. Hold on to your BBEP shares and ride this out.
Keep your eye on the bonds!!
BBEP (2) bonds currently pricing at $54 and $62. As a comparison to a couple of other MLP's:
Linn Energy (5) bonds pricing at $44 - $50
Memorial Products (MEMP) (2) bonds pricing at $67 and $69