rumors - I won't wish you good luck, because surgery should not be luck. I wish you a good surgeon, one who knows exactly what he's doing (a Michel of surgeons?) and an equally good anesthetist.
rumors - I see 2015 as a transition year. There will still be, I think, around 25% of the planned cuts to be made, the submarine spin off and possibly something else (not sure that will enable Combes to reach his $1 billion goal), and more refocusing of R&D plus restoring the company's historic entrepreneurial spirit. Many new products will be just starting to pick up momentum - vectoring, small cells, SDN/NFV. I think 2016 will be the big year, with the reorganization expenses out of the way and new products in roll out. If Combes is really successful in reinventing the company, not just as a survivor but a true leader, that is when we will know. But I will be watching closely in 2015 to see if it is heading in the direction of long term sales and margin growth or sputtering.
jack - I am overweighted Apple too, but not so much as I am ALU. Outside of small holdings in IRAs, that is the sum total of my stock investments. My experience with Apple is similar to ALU - I have done well after a horrible start. Bought both too soon. Apple at $525 (now $75) thinking it had bottomed and watched it go to $380 before reversing course. I wish I knew how to time peaks - like ALU at $4.65 or AAPL at $119. If I did, I could have sold, paid my taxes, and had enough left to buy back more shares than I have now. A market timer I am not.
I see AAPL differently from an investment perspective than ALU. If ALU pulls off its turnaround plan and then becomes an important force, it could go a long way from here, and I can see holding it for years if everything looks bright. Apple, with its domination of an increasingly saturated high end smart phone market, limited number of products, and enormous market cap I think has a limited run ahead. And if sales slide, as happened in 2012, it could drop a long way. I can see it going to maybe $140 over the next year, but if it does, I am likely to exit, while ALU at $5 or more would still be a hold for me as long as it is growing. Any advice Cathy has to offer on AAPL as well as ALU I'd certainly like to hear.
jack - thanks for the positive news. It's painful to watch my stocks, that have nothing to do with oil (ALU, AAPL) and stand to benefit from more consumer spending and reduced energy costs, get hammered because of it. It's as if it were announced that someone had found a way to end all crime and poverty and the stock market responded by tanking because what would happen to security and discount companies?
You are another alias for our resident basher - zero/booboo/tradestox etc., a pathetic loser, and as even you admit, I am correct. I have no wish to further engage with your latest alias, you pathetic, hateful, psychotic.
Your logic is akin to saying a football team is a loser because it "lost" the second half of the game 7-0 after winning the first half 49-0. Can you really be that dumb? I guess so, since you bet your money against Combes. The irrefutable FACT is the price was $1.30 when Combes announced the Shift Plan, and it is $3.35 today. It got ahead of itself, and was pushed up by speculation of a Nokia buyout that has since faded, so the stock corrected, and is now on the way back up. And if you don't learn from your losing strategy of shorting Combes, then you are doomed to repeat your monumental losses. There are lots of people on this board who have made money investing in Combes. LEARN FROM THEM.
1. tradestox HATES Michel Combes. So now we know who is the tradestox alias on this board, don't we, tradestox?
2. Yes, I lost a lot under Ben, but I made it all back and a lot more with Michel, which is why you hate him so much. How's that $2.40 short from a few weeks ago feel now? My friendly advice is to cover now because it may get much worse.
3. You like to pick a point in time when the stock was higher to "prove" the Shift Plan has failed, conveniently forgetting the stock more than tripled before your particular point. The fact is the stock is up over 150% since Michel announced his Shift Plan. Just the facts. You shouldn't have switched from long to short back then.
4. Combes never scaled back the Shift Plan, as I pointed out to you before, but you are evidently too stupid to understand basic math (no wonder you are getting killed on this stock). The total cuts for ALU were reduced an enormous 5% from 1 billion to 950 million because 50 million of the cuts are in submarine, which is being spun off and therefore accounted for separately.
Now how about you take your psychotic hate somewhere else and leave the winners on this board alone, okay zero/booboo/dolphin/tradestox? Everyone here is sick of your pathetic drivel, loser.
Ben is undoubtedly a nice guy, but his leadership rates an F+. The plus is because he understood that despite its troubles, it was essential to keep investing in R&D and bring its products up to date. However, he didn't focus the R&D spending to be fully productive, did not instill the entrepreneurial spirit the old dinosaur desperately needed, and most of all did not control spending, making the tough cuts that were absolutely essential for survival. The company would have gone BK had he stayed, and the creditors would have gotten the benefit of those products developed by R&D under his tenure, not the shareholders. Hence, the F part of his grade. Combes is firing on all of these cylinders, and I think he will turn this ship around. Considering where it was, that is little short of miraculous. Thank you, Michel.
Correction here yacht boy - The Shift Plan did not start on Jan. 1 2014. It was introduced in June 2013 when the stock was $1.30. Don't blame Combes for your horrendous decision to sell then, and for all I know, go short as well. Ben was a nice guy, but he lacked the fiscal discipline to run a company with serious financial problems. I hope he's having a nice retirement somewhere, and that he held onto his ALU shares after Combes took over.
The last time Fitch downgraded French debt was July 12, 2013. The price of ALU's stock then was $1.94. A month later, it was $2.66, a 37% gain in one month (444% annualized)! I think our resident Combes-hater is just throwing out some desperate BS because he's taken a beating going against him. As you say, what happens to ALU's stock depends on what ALU does. If they continue to do well even into the more difficult Q1, we will do fine, and I think we will continue to see markedly improved performance on a year over year basis, unless there is some kind of economic collapse (I don't expect that). Nor do I expect this week's market correction to last long. I expect it is just a temporary reaction to uncertainty caused by a drop in oil prices, which is more good than bad. I don't expect it will delay plans for submarine.
rumors - here is another obvious point about the irrelevancy of Fitch to the CAC40. The CAC40 was down 2.72%. The German Dax 2.67%. Maybe Fitch made the .05% difference? LOL. England was down 2.49%. Did Fitch just downgrade those countries? I think not. This is a reaction to the oil price decline. Ultimately, that is good for ALU. More consumer money to spend on devices that connect to the internet. Maybe some minor negative effect on the soon to be spun off submarine business with plans to serve ocean oil platforms, but that is a future business anyway, not particularly significant, and would probably take a year or more of depressed oil prices to affect long term plans. But in the short term, the market is frightened by disruption and change, so even my Apple was down today though low oil prices can only help them.
You are really nuts, tradestox. You have so many aliases you can't even remember which are yours!!! Here's some advice to avoid this problem. USE ONLY ONE NAME!
rumors - "stunning accomplishment" indeed it is. 18 months ago, after borrowing $2.1 billion to pay off debt due and cover operating losses for 2013 and 2014, Ben burned through a full third of that amount in just Q1 2013 alone. That loan had just saved ALU from BK, and ALU was headed full speed to running out of money again, but with an extra $2.1 billion in debt. And here we are today - operationally profitable, and as the restructuring winds down, about to become profitable and cash positive. Truly amazing what Combes has accomplished. Going forward, he will need to increase sales too, but all of the steps he has taken, in terms of product focus and development, and partnerships, are geared to increase sales. Nothing is certain, and we are not out of the woods, but I feel very good about rolling the dice, and putting most of my "gambling" money, on Combes. It's that remaining element of uncertainty that allows for the potential of large gains still to come if Combes succeeds. Wish I had more gambling money.
He is positive once again, though not as over the top as he was last time:
"I like Alcatel Lucent, I think it's alright. But I must tell you I really like Cisco here. But ALU had a very good analyst meeting, I followed it closely and I think you're on the right track.""
rumors - Combes prediction of 7 billion euros in IP revenue goes back to when the euro was something like 1.35 to the dollar. Even then, Combes hinted that they might do better than this. I think the decline in the euro will definitely boost ALU's numbers, probably significantly, and my guess is this will more than outweigh any negative effect on the ADR price arising from a lower exchange rate.
Pine for Ben to return? LOL. Michel has signed up lots of partnerships, and some will likely not produce much, but others may become important breakthroughs. Unlike his predecessors, Combes is serious about business and making money, so these will certainly be pursued with a different level of urgency. My guess is the HP deal represents a part of his commitment to reach new customers beyond the telco companies, something Ben did not do. HP has access to these companies but not solutions to all of their needs. This deal, if successful, will enable them to compete better in their field, while enabling ALU to expand their customer base, which is essential for them as telco is a limited and cyclical business.
This had been mentioned earlier. This is a quote from Raby during the Q2 conference (posted on Seeking Alpha):
"In terms of overall fixed cost savings, what does this mean? We have generated EUR94 million in Q2, bringing the total for the year to EUR237 million. We have said that for 2014 you should expect a small third of our cost saving objectives initially set at EUR1 billion in at constant comparable parameter, more like EUR950 million."
The "comparable parameter" refers the removal of Enterprise from the equation after its sale. This was explained more fully at the time of that sale but I can't find that earlier quote without spending more time than I have right now.
No, they are not slippery. The cost reductions were reduced by 50m to reflect divisions that were sold off, and consequently reductions in costs planned within them no longer apply to ALU.