SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Non-Tech : Williams Companies, Inc. (WMB)
WMB 56.98-3.5%3:17 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Clay Enos who wrote (157)10/1/1999 10:57:00 AM
From: Raymond Clutts  Read Replies (2) of 271
 
For the same reason that GM's price does not reflect the sum of the parts valuation that GMH's components would otherwise yield if GMH were freed to act independently. There is no belief priced into either parent company's shares that would reflect a market consensus that the parent is about to divest themselves of ownership of a controlling interest and thereby realize the full value of their subsidiary's sale price.

At least that may be one primary reason IMHO. Others relevant to WMB's current "undervaluation" of its WCG holdings is that the market has generally devalued companies with big pipes. Look at the recent share price reductions in Qwest and Worldcom (not to mention GBLX the only one of the four that I am not currently long in) and you'll see a pretty uniform industry devaluation as the market's perception of an imminent glut reduces valuations across the board.

Unless and until demand and then revenue and finally earnings rise to exceed the current perception that this industry is glutted with over-capacity, prices will remain low. There may also be a perception that long distance ratecuts are the first step in wholesale data transmission price cuts that will further erode profitability before rising utilization can outrun existing capacity.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News