[Iusacel gains on Telmex earnings report.]
Friday February 4, 2:40 pm Eastern Time
Telmex rosy earns push sector peers into record ground
By Cyntia Barrera Diaz
MEXICO CITY, Feb 4 (Reuters) - Market enthusiasm for
heavyweight Telefonos de Mexico (Telmex) -- reinforced by its
strong fourth-quarter results -- on Friday propelled other
telecommunication sector stocks to record highs.
Telmex, Mexico's dominant telecommunications firms, was the
top gainer Friday, helping lift the IPC stock index (^MXX -
news) nearly 1 percent in the first couple of minutes of trade.
In New York and for second consecutive day, the company's
American Depositary Receipts (ADRs) were momentarily stopped
in early morning trade due to an order imbalance. They opened
shortly afterwards at more than $3 above Thursday close.
By 11:15 p.m. local time (12:15 p.m. EST), Telmex shares
gained 1.85 pesos, or 6.53 percent, to 30.20 pesos a whisker
below fresh life high at 30.50 pesos.
Its less-liquid A shares , not included in the 35-piece IPC
index, firmed 1.45 pesos, or 5.08 percent, to 30.00, also a
new record.
Telmex ADRs (NYSE:TMX - news) soared 8-3/8 to 128 on Wall Street.
``Most analysts remain extremely bullish on the Telmex
outlook, and that is fueling the rest of the sector
companies,' said one trader.
The telecommunication sector index (^MXXT - news) shot up 5.6
percent to 35,294 points.
Cellular firm Nuevo Grupo Iusacell, paging company Biper and
investment firm Carso Global Telecom remained in the top
percentage gainers list Friday morning.
Telmex posted strong results Thursday afternoon after the
market close. Its spectacular growth in cellphone subscribers
fueled the company's quarterly revenues and operating profit.
The company added 1.124 million cellphone subscribers during
the fourth quarter, to a total of 5.272 million cellular
subscribers at the end of last year, resulting in a 149.5
percent growth in total cellular subscribers from end 1998 to
end 1999.
Fourth-quarter operating profit came in at 9.984 billion
pesos, or 25.7 percent higher than during the same quarter in
1998. The operating margin was 38 percent compared with 36.3
percent during the same quarter of 1998.
During a conference call with analysts Friday morning, Telmex
chief financial officer Adolfo Cerezo said the company will
pour some $1.5 billion into cellular unit Telcel.
``If Telcel remains firm, (rival) Iusacell is likely to
follow,' said one sector analyst who asked not to be named.
Iusacell V shares jumped 2.80 pesos, or 16.97 percent, to
19.30 pesos after setting an all-time record high at 19.70
pesos earlier Friday.
Its ADRs (NYSE:CEL - news) gained 2-1/16 to 20-9/16 in New
York floors.
Iusacell had some 1.1 million suscribers at the end of 1999
third quarter. The firm is expected to post its quarterly
results in the coming two weeks.
Meanwhile, Mexico's No. 2 paging provider Biper leapt 0.09
peso, or 5.60 percent, to 1.70 pesos. The company has
experienced a heavy selloff since early this year.
Bipers ADRs, (NasdaqNM:BIPRY - news) hadn't traded yet but
closed at 7/14 on Tuesday.
Telecommunication investment firm Telecom rose 5.60 pesos, or
5.36 percent, to 110 pesos. Earlier Friday, it set a fresh
life-time high at 111 pesos. |
