On H&Q conference, from Yahoo board:
----------
HQ conference (I)
by: bartleby_the_scrivener_2 56077 of 57606
IDT's presentation went for about an hour, and the room was packed, mostly analysts from all the big-name institutions. Jim Courter presented, w/ an impressive, reassuring presence (you can tell he was a six-term Congressman before signing on as IDT's president). The presentation overall was top-drawer, clearly a notch above others I attended.
The focus was primarily on IDT's fast-growing telco business and future growth strategy. Based on my informal conversations with others in the room afterwards, it's clear EVERYONE was hoping to hear about the "registration" status. IDT made clear at the outset that its attorneys had recently cautioned them to say very little, if anything, about Net2Phone.
This conspicuous silence about Net2Phone speaks LOUDER than words, IMO. It appears that something big is about to break and I have to confess that, as a lawyer, I would have cautioned IDT to proceed just as they did - for ethical reasons. If it's any consolation, my distinct impression is that the institutional investors in the room are just as impatient and curious as we all are--frankly, the fact that IDT's management is willing to "play fair" and not disclose to some investors before others says alot about their integrity.
In sum: IMO, SOMETHING IMMINENT is about to be announced about Net2Phone, and clearly, there is a lot of anticipation surrounding this among institutional folks. As for the bond buyback, my distinct impressions are: (1) no problem with consent; (2) this is a stepping stone to a much larger transaction than the credit facility; (3) further extensions seem unlikely. My guess is that institutional money will hold (not sell) and gradually accumulate until news breaks.
I will write a follow-up after the market closes today. Some disclaimers about this and subsequent messages: these are solely my own opinions. I have no affiliation with IDT or the conference organizers, and do not reflect their views or opinions. I don't expect anyone to rely or make investment decisions based on my remarks, and my aim is simply to informally share my own insights with fellow investors--i.e., do your own due diligence.
The Scrivener
--------------------------------------------------------------------------------
HQ conference (II)
by: bartleby_the_scrivener_2 56297 of 57604
Here are further brief impressions of today's conference:
NET2PHONE:
1) whatever news/event is about to be announced, it focuses specifically on Net2Phone, not the rest of IDT's operations.
2) IDT's attorneys expressly advised mgmt. not to say anything about Net2Phone's (as distinct from IDT's) operations as of "a month ago." --i.e., mgmt. could only comment on Net2Phone's activities up through a month ago.
3) "In registration" means what it says, namely, a share offering in the works.
IMO, some sort of "quiet period" is clearly in place. Increasingly, for example, presenters at hi-tech conferences are cautioned by their lawyers against "gun-jumping" or "hyping" just before a contemplated offering. I am told that consequences/penalties can be quite severe, i.e., up to 12 month delay/prohibition of offering.
Although the S-3 filed today may be indirectly related to the awaited offering, I doubt this is "THE news" for reasons: (1) it does not pertain to Net2Phone, but IDT; (2) why would mgmt. have been so deliberately cautious if the S-3 was filed today? (3) today's S-3 filing states that IDT will not obtain any proceeds.
IDT's Telco operations:
1) mgmt. seems intent on maintaining its core strength in int'l telco operations, i.e., independent of Net2Phone
2) profit margins will increase based on using own networks and switches instead of leasing capacity from other carriers
3) as mentioned in last conference call, IDT has invested over $100 million to build out global infra to carry out these goals
4) benefits of long-term investment should be realized soon
5) Europe, Latin America and other int'l are major growth markets due to deregulation, high growth rates, high margins.
The bottom line is that IDT has a solid, profitable core telco business--after Net2Phone spin-off--and probably with better margins by eliminating Net2Phone-related start-up costs.
Hope that helps all longs sleep better on their shares--
The Scrivener.
----------------------------------------------------------------------
|
