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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (17409)	8/16/2002 11:03:21 AM
From: Frank Pembleton	Read Replies (1) \| Respond to of 36161

K... yeah, I think it's sixty consecutive days - I think... haven't heard any news on that (as the market continues to pound it to zero). Regards, Frank P.

To: Cogito Ergo Sum who wrote (17409)	8/19/2002 8:37:05 AM
From: Frank Pembleton	Read Replies (1) \| Respond to of 36161

Nortel stock stalls in U.S. below $1 Reuters News Agency Just when it looked like things couldn't get any worse for Nortel Networks Corp., shares in the tarnished technology star have stalled below $1 (U.S.), one of the benchmarks for a New York Stock Exchange listing. Nortel's stock, squeezed as phone companies slash orders for telecom equipment, has closed at 96 cents, on average, over the past 20 NYSE trading sessions. Over the past 30 sessions, the average price is $1.11. The New York exchange can put companies on alert after their stock falls below $1 on average for 30 consecutive sessions. Companies then have six months to restore their shares to more than $1, using such means as a reverse stock split, which reduces the number of shares outstanding but boosts their individual value. "We are aware of the current environment and listing requirements for NYSE, but our policy is not to comment on rumour and speculation," said Nortel spokesman David Chamberlin. While Nortel's feeble shares would not automatically trigger removal from the exchange — a spokesman said it was just one of several criteria for a listing — it highlights just how far Canada's former high-tech titan has fallen. "We've gone from a gold rush mentality to one of 'we don't care,' " said Robert McWhirter, fund manager at Triax Investment Management Inc. in Toronto, who does not own Nortel stock. He said declines across the telecoms sector had been "unprecedented." It looked like Nortel had hit bottom July 19, when it and other non-U.S. firms were dropped from the prestigious Standard & Poor's 500 index. That triggered a flurry of selling as fund managers who matched the index dumped Nortel. One week later, in a stunning selloff, the stock collapsed to a 20-year low of 82 cents after a Spanish wireless customer cancelled plans for part of an advanced network. Investors recalling the go-go days of 2000 can only shake their heads and remember Nortel's peak of about $87 that year. Friday, the stock slipped 5 cents to close at 85 cents on NYSE. On the Toronto Stock Exchange it shed 8 cents (Canadian) to close at $1.34, hovering above its 52-week low of $1.20 and 90 per cent off its year high of $14.24. Once a corporate Goliath whose every stirring sent shock waves through the Canadian marketplace, Nortel today makes up only a marginal 0.89 per cent of the TSX composite and ranks a lowly 29th on the index in terms of weighting. That's a massive decline from the company's heyday, when it made up about one-third of the main TSX index. Brampton, Ont.-based Nortel, which has racked up $4.8-billion (U.S.) in debt and last year lost $27.3-billion, is today running an endurance race as it faces a long, painful wait for a market recovery. Hit by a steep drop in demand for equipment used in phone, wireless and Internet networks, Nortel recently struck a highly dilutive $1.5-billion financing deal to shore up its balance sheet. But while its name may be a market has-been, Nortel is again finding favour with some analysts who view the limping stock as a buying opportunity, particularly when compared with arch rival Lucent Technologies Inc. While Murray Hill, N.J.-based Lucent has been buffeted by the same negative market forces, and has similar revenue, its stock closed at $1.45 Friday on NYSE, well off its 52-week high of $8.75 but more than 40 per cent higher than Nortel shares. That spread doesn't make sense because Lucent's operating performance and prospects are weaker, argued Scotia Capital analyst Gus Papageorgiou in a recent note. SoundView Technology Group was one of the first to make that argument when it issued an upgrade on Nortel, revising its rating to "outperform" from "neutral" in late July. "The environment that surrounds every supplier to the telecommunications carrier business is terrible and begs the question why research analysts would call any company in the sector an outperform," wrote analyst Kevin Slocum. "We simply think that Nortel's relative valuation has gotten too low and that it deserves to trade at least in parity with Lucent." He repeated his rating in a note this week that suggested insider buying of two million shares backs up corporate claims of stability. Lehman Brothers now recommends that investors buying into the wireline equipment sector hold Nortel stock, a slight improvement from its earlier suggestion to sit on the sidelines. Analyst Steve Levy points to confidence on customer spending, the low stock price, the company's cost-cutting and the resolution of management issues and financing concerns. "We believe that Nortel shares could climb from their current level of less than $1 to $2.50 in the next 12 months." globeandmail.com