Money | PhoneReport v2.0

Posts Tagged ‘money’

Motorola Q1 Earnings, Nokia’s Patterns and Apple

Written by Meraj Chhaya on April 24, 2008 – 10:47 pm

[Written by our financial expert, MH]

Finally we had Motorola Results, that were worst than what I was thinking of, and with that Motorola will probably continue going to lower levels.

Let me resume the story and tell you what really happened and why Motorola stocks (NYSE:MOT) didn’t fall more than 3%. and why they can tomorrow fall more than that.

In the first three months of 2008 Motorola said its loss widened to $194 million, or 9 cents a share, from a year-earlier loss of $181 million, or 8 cents a share. Sales dropped 21% to $7.45 billion from $9.43 billion.

Excluding one-time costs, Motorola would have lost 5 cents a share. On that basis, analysts were expected the company to lose 7 cents a share on revenue of $7.84 billion.

In the current second quarter, Motorola estimated it would lose 2 cents to 4 cents a share from operations, compared with Wall Street’s consensus prediction that the company would break even.

Motorola shipped 27.4 million wireless handsets in the first quarter, down from 40.9 million in the prior quarter and from its all-time high of 65.7 million in the 2006 fourth quarter. Wall Street was expecting the company to ship as many as 31 million.

The company’s global share has fallen to below 10% from nearly 23% in late 2006.

The handset division posted an operating loss of $418 million, compared with an operating loss of $233 million a year ago. The division lost $1.2 billion in all of 2007.

Mobile sales fell 39% to $3.3 billion from the year-ago quarter. The mobile unit accounted for just 44% of total sales, compared with as much as two-thirds of Motorola’s revenue just a few years ago.

EVERY THING FELL. Worst it couldn’t be, and I woudn’t be long on MOT stocks. The analysts’ reaction was truly bad, and Zacks Rank, the guys I follow have a Sell Rate to Motorola.

Today, Motorola shares didn’t fall much more mainly because all technological stocks were touching new relative highs, monthly or yearly highs as Apple, which made to day a very beautiful candle (on technical analysis).

But, in the other hand, Nokia also followed Motorola’s way touching new yearly lows at 28,28, but again doing the Doji Pattern (a pattern of recovering) as it done two days ago.

The THING right now that we need to watch is what Nokia will do, will their shares follow Motorola? Or, will they fight against the storm?

Sources: Market Watch, Bloomberg, TimesOnline

Tags: analysis, Apple, bankrupt, earnings, mh, money, Nokia, patterns, q1, results, showoff
Posted in Motorola, Nokia, Reviews, exclusive | 1 Comment »

Analysis to the Motorola SpinOff

Written by sampdoria on March 28, 2008 – 11:17 pm

Some days ago Motorola announced a SpinOff, in this case a separation of Motorola in two companies.

It is known that Motorola was preparing an operation like this some 2 months ago, but just now we had the official announcement. A SpinOff is always taken well by the investors, mainly because it will create 2 companies focused in their products, that normally aren’t competitors, which means that we can have a Motorola more focused in the mobile markets and more directed against its rivals, such as Nokia and Samsung.

But, that was what happened in 26th March. We saw a huge gap up (an opening superior than the last close), on which the stock plunged from 9,71$ to 10,30$. But, in the afternoon the major analysts came with their reviews, and investors noticed that the spin off could not just generate 2 companies, but three or more.

This is a little bit scary because the company can lose its value and this would never be understood rightly by the stockholders and investors. A company with a relevant capital just focused in mobile phones and their applications is good, but two or there more would transform all the "Motorolas" new companies very small in relation to the big players. So, Motorola disappointed many by failing to offer answers to critical questions about the unit’s future on that afternoon conference, because other important questions about the proposed company, including its name, capitalization, key executives, intellectual property holdings, market share goals, reorganization and financial structure were left unanswered.

But, when Greg Brown (actual Motorola’s CEO) was asked to justify the spinoff he gave the following statement: "It would help with clarity of direction for employees and customers [and] help attract top-notch CEO candidates."

Yes, we can say "wow", and we don’t even need to justify, because the CEO didn’t!

Some analysts said that spinning off the mobile handset division will not dramatically alter its current product offering or change the perception that Motorola doesn’t know how to consistently win and keep customers through a wider set of innovative products. No big changes.

If the market sees nothing new in an action that will cost millions off course, If the markets don’t see any possibility to make "extra money", if the investors are disappointed, the markets simply falls down. And that was what happened, the market fell down, from 10,30$ to the lowest close price of the past 5 years (today), 9,21$. The markets always know what is the right thing, and probably the markets think that a SpinOff in this conditions isn’t good. And you can’t say this happens because all the markets were down. It’s totally false, because the markets had a nice week comparing to the others of this month.

Here is a daily graph, just to see the last drops from the news: