Why do they need to get new jobs? We won't know for almost a year how Morgan's prediction on the stock at this time plays out. Those who recommended the stock when Combes came on board have seen the stock more than double, even with recent declines.
Upgrades/downgrades aren't intended to move a stock price. They tell you where some analyst, hopefully with a reasonable amount of knowledge and experience, believes a stock price will go over the long term. That is why people who are long term investors care. It's an expert's opinion. Of course it's not a guarantee. It is like a Consumer Reports endorsement. It doesn't guarantee you will have a good experience buying the brand they recommend, but the odds are better than with buying a brand their experts condemn.
Does it matter at all whether the price was up 3 cents or down 3 cents today? It is based on people's guess as to earnings, but that's all it is - a guess. Thursday, we will know, but unless someone picks up some inside info sooner, whatever it does tomorrow or Wednesday won't make a difference either. What happens to the stock on Thursday is a different story.
rumors - Those good old days were not so great. Perhaps the most amazing thing is after securing that $2.1 billion loan from Goldman, to pay off loans due in 2014 and 2015, and give the company time to regroup, Ben promptly lost $700 million - 1/3rd of that - in operating expenses for just one quarter, Q1 2013. The fact that ALU is still here is a remarkable achievement, hence my willingness to put much faith in M. Combes.
I'm not too afraid of cutbacks in LTE build out in America. As equipment sales decline, software sales will rise, and margins will be higher. Europe will rebound, China will grow, other areas will provide orders, and declines in legacy sales will no longer be much of a factor as they are already very small. Meanwhile, I believe new products, such as vectoring, will increase in sales and bring higher margins.
I still expect submarine to be sold but that may be becoming more tricky. With all the new orders, that may be a profitable unit. Losing those sales would hurt performance going forward. I think submarine was a loser last year, so removing it from financial statements could negatively affect perceived year to year performance.
Wireless, I don't know. That encompasses the small cell business which could be important going forward. Not sure they want to get out of this business, even if short term it could provide a helpful cash boost and allow margins to rise. One other possible asset sale with Goldman paid off and the patents freed is to sell E 600 million worth of patents not used in ALU's business. At one point, Combes spoke of Bell developing products for patent income purposes rather than ALU's use. That could be for royalty income, but also for a one-time sale.
sam - I was lucky on this one too in that I had no way of knowing how good Combes would be. I got in when Ben told us ALU was now a "normal" company and then averaged down as "normalcy" fell apart. I believed the company had great assets, but lacked the leadership to turn them into money. What I did not understand was how close Ben drove this company to the brink. Fortunately, Combes has done an absolutely fantastic job, and it looks like he will successfully pull this company back from the edge and make it once again the leader the Bell name long represented.
Maybe he did and maybe he didn't, but the point for investors is not how well did Sam time this stock, but how well has Combes performed. And he has tripled the stock price.
If I'm reading this right, Nokia just creamed expectations, and are increasing their forecasts for the year. This should bode very well for ALU.
I think Nokia is the weakest of ALU's competitors, so if they do well, that will likely be a sign that the market is strong, which would be very good news for ALU.
Agree with you on that. And Combes does not fill our ears with talk. He has given us his plan to consider, and has promised only one thing - cash positive by the end of 2015. The result is this stock will be moved, just as you say, by results, not talk. If the results are good next week, we can expect the stock to go up, and if not, go down. Just as it should be.
Perhaps someone with greater accounting knowledge than I can help me on this, but I believe the reason they can buy cheaper, off-the-shelf equipment is that software does the thinking for it. But, software is generally leased, with recurring payments. As such, is that a "capital expenditure?" I wouldn't think so. In other words, does a reduction is "capital expenditures" necessarily mean less money is available to a company like ALU, or is part of AT&T's future expenditures simply being reclassified as something else?
The article doesn't say "take on more risk, " it says "take on more risk and reward." The implication is, instead of getting a fixed price for equipment, they get a better price for providing equipment that does the job well, while accepting less if the product does not work well. It's a sign of confidence in the quality of the work they do.
Wow. You really can't get over Combes having such great success with ALU after the failure of your beloved Ben. The hate and anger just spews from your posts. Get over it. Move on. Hate will destroy you.
Indeed. And that is exactly what Michel Combes is doing. The stock has almost tripled since he came on board, and if he successfully completes his plan, which now appears to be proceeding ahead of schedule, I suspect we will see much more upside. Thank you, Michel.
These things never seem to hold up, but we've opened up 7 euros, or the equivalent of $3.70, even with the French market down. Hope it holds.
jack - ok. Here is my response on a major correction. ALU gets creamed. It is a volatile, risky stock, and as such is one of the worst to own when fear strikes. That doesn't mean there is anything wrong with it, just that it is the type of stock to suffer the worst when there is fear. One exception - if ALU has a blow out second quarter, it should survive a major correction. The reason is that, strange as it seems, if it looks really strong, investors may think of it as a safe haven in a downturn.
Now, I don't expect either - a major market correction or a blow quarter for ALU. If there is a major correction, I expect a smaller version of 1987, not 2000 or 2008. In 1987, the market regained its losses in a fairly short time. The others took years. I don't expect that. As for ALU, I expect an acceptable to good quarter, not a great or blow out. To me that is -$0.03 - $0.00. I hope for a pleasant surprise, but do not expect it. What I hope for even more is a big upside surprise on the top line, but do not expect that either. Here's hoping.
Going out tonight but will think about that later. But you need to understand that if you bash, people will see anything serious you say as just another form of bashing and not take it seriously. And so you won't get polite answers. Joking is fine, particularly if it's funny, but attacks on the company or other posters, even if meant as jokes, will rub people the wrong way. I'd rather see this message board return to being the exception for Yahoo message boards, rather than a typical one.