Grinder, while you pointed out the problems in the Morningstar report, there is some truth in it which should be addressed, namely, the perception that pro-forma reporting is inaccurate when compared to GAAP standards.
The problem with Morningstar's views is that most of Q's charges are not and will not be recurring. We are probably past all these charges, unless Q writes off its NetZero investment [BTW, what an approporiate name for a company, huh?] and its Globalstar holdings. There were some charges when the infra and the handset divisions were sold, as well as the problem with the Brazilian operator.
The biggest potential bugaboo is of course Globalstar. If my memory is correct, Q has assigned a value of $600m plus to its potential exposure on G* in its SEC filings, a figure which is of course the worst case scenario. The "real" worst case scenario is undoubtedly smaller--got to keep those lawyers from getting a toehold!
What the write-offs and problems have in common, for the most part, is that they are investments which have failed. The analysis simply does not reflect the strength of Q's operations and prospects. Also, don't forget that Q has made some tremendous investments.
Always look for the truth in the SEC filings. It's sometimes tedious reading but that is where all the little and not-so-little problems can be found.
The Q business is a very sound one.
All of this will be water under the bridge in two or three years, in my opinion. |
