Robert McWhirterNortel ASNTEL.TOWEAK BUYJul 21, 2005
Ranks poorly in his model at 580 out of 700. If the stock can get above $3.45 then the game is back on. Earnings report is due soon and the question is, can they hit their earnings estimates of $0.08. Of more interest is earnings for '06 where the forcast is $0.22 which would give you a 15 P/E against 67% earnings growth. Could be a trading opportunity if techs move up.
If you own the stock, you are playing that there is some value in the assets they own. The company is not a going concern. Have a huge deficit hole in their pension plan. Individual parts of the company may be better being sold off.
Has about $4 per share in cash. They are thinking of selling an asset that would raise about another $1 billion, which would add another $2 per share in cash. However, the overall quality of the balance sheet is as bad as he has ever seen it. Speculative.