Vodafone (VOD +0.3%) views its Verizon Wireless stake as a more attractive long-term asset than its slumping European ops, and is thus loath to sell it, argues Bernstein's Robin Bienenstock in the wake of the carrier's FQ4 report (included major Y/Y drops in Italian/Spanish revenue). Bienenstock, no stranger to throwing cold water on deal expectations, also thinks Vodafone's remarks about keeping its new $3.15B VZW distribution are a sign Verizon (VZ -1.3%) won't be issuing fresh distributions in the near-term; recent comments from Verizon's CFO also back this up. [View news story]
No Pan, they can not just jilt one parent. Verizon has a history of threatening not to do a payout from the wireless unit, but the company overall cannot afford to go without it.
Vodafone (VOD): FQ4 organic service revenue -4.2% (in line, but worst quarterly drop on record): -12.8% in Italy and -11.5% in Spain. Impairment charge of £1.8B in Italy, bringing total impairments for Spain and Italy to £7.7B for the full year during which sales were down 4.2%, to £44.4B and core earnings were off 3.1% to £13.3B. Adjusted operating profit beats, rising 9.3% to £12B. The company said it will keep its 45% share of Verizon's (VZ) dividend payment to shore up operations. [View news story]
Well Veritas, they are investing in Africa, which makes some sense. I have one other idea, which I might put into an article. All but one of my articles have been published, here, but the one that was rejected was a followup specifically requested by multiple users! That leaves me looking for an alternative to SA... I posted that article as an InstaBlog, since I'd told folks I would publish a follow up. At the same time, I swore never to spend hours writing for SA for free again.
Vodafone (VOD): FQ4 organic service revenue -4.2% (in line, but worst quarterly drop on record): -12.8% in Italy and -11.5% in Spain. Impairment charge of £1.8B in Italy, bringing total impairments for Spain and Italy to £7.7B for the full year during which sales were down 4.2%, to £44.4B and core earnings were off 3.1% to £13.3B. Adjusted operating profit beats, rising 9.3% to £12B. The company said it will keep its 45% share of Verizon's (VZ) dividend payment to shore up operations. [View news story]
Though I must confess, I thought the results might be even worse. The thing is, they haven't even begun to adjust for all the problems with India. Somebody used the media to engineer a good exit point here.
There was substantial questioning of INVN supplying for the S4, please post a link to documentation, if you have it. I don't think their future is so tied to smart phones anyway: http://seekingalpha.co....
As for Skyworks, I think the GS4 win is offset by historical Apple reliance, whereas RFMD gains both as NEW customers... a fact which has not yet bet fully priced in.
The market seems to be only interested in momentum stocks right now. RFMD and PANL are growing their businesses to whole new levels, but without the press, it apparently means nothing.
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
Hi Pete, While the recent stock offering technically provides more availability for the shorts and dilutes the long, I think the actual impact is trivial. What really matters is the relative finances on each side. Yes, I'd guess the squeeze will continue for a while (weeks?), but that doesn't necessarily mean TSLA's price will continue to elevate. The low-hanging fruit has probably already been seized, and the rebate rate is dropping over the past several days. That said, my guess could be completely wrong, and I wouldn't really care if it is. Who knows what Musk will say next week? He's certainly a great salesman, and those amongst the fan(atical)-base don't seen constrained by any quantifiable valuation metrics. Certainly more shorts trying to game the system and then getting burned could drive the price higher. Like I said, it seems pretty clear that the best course is to just stay away until we're into the summer, and some perspective related to the actual business of selling cars and batteries has returned.
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
Sure Pete, Hopefully you already know that short shares have theoretically unlimited risk, since there is no limit to how high a stock can be priced. The broker is ultimately on the hook for that, and since they don't want to be stuck holding the bill on a bad position, they will force the shares to be bought back if loss looks like it could exceed the client's available capital. This is how an unreasonably high share price can force a buy, leading to an even higher price and becoming a cycle called a short squeeze, whenever their is a high percentage of shares held short. Investment banks get hefty sums for managing these stock sales. Driving prices outside market hours is fairly easy because of the light volume. They know the announcements are coming before the public, so they can use options to have hedges in place beforehand, thereby mitigating their risk. Companies like Data Explorers provide daily information on short positions which is not available to retail investors. Which speaks to your second question... You won't know until after it's over. The most accurate info is the short data published by the exchanges on a bi-monthly basis, 3 days after the fact. Some of us can check the rebate rate (the cost to borrow shares for shorting) and that's a reasonable proxy. There was an attempt to reform the markets and have them publish daily short data (Reg SHO), but vested interests made sure that what was actually published wound up being completely unusable:
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
Yes, to all those noting the insanity, but it's pointless to argue valuation. This is a short squeeze plain and simple. The pricing has nothing to do with the company's business and everything to do with market manipulation: big money forces the price up, particularly in the AH and premarket, then tries to correlate exit sales to force covering. I'm very glad I took a relatively small loss on my short the moment I saw earnings come out. The fanatical fan-base doesn't help, either.
My article, Tesla's Matrix Moment, was meant as a fairly neutral piece of entertaining reading on the troubles that success will bring for Tesla, but of course it was largely blasted for for containing any negativity:
At least I called the dilution event correctly, despite Musk's comments to the contrary just a week ago. None of that outweighs the short squeeze, though. Just stay away until big money is done with it's frickin poker game.
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
Tricky, I completely agree that it's a smart thing to do, but Musk's own comments show that he was aware of impending short squeeze, so to not account for that in his statements during the earnings call is just playing the market (Tesla investors on both sides).
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
Absolutely Cassina, he's right to move with market, and this is certainly a short squeeze. I've been very glad for our conversation in my article, but even gladder that I closed my short position (as documented in comments there) as soon as earnings came out. I took a loss, but obviously it could have been MUCH worse. I think one of the points my article missed is what a well-managed and market savvy company Tesla is, though that can be a double-edged sword.
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
No jahluv, the offering specifically says that they will use the proceed to pay off the DOE loan. Previously they had merely announced their plan to do so, without saying they would take out another loan in the process.
Tesla (TSLA) takes advantage of its huge run-up to file a mixed shelf. Shares -2.9% AH. (S-3) [View news story]
Nicu, it doesn't matter to me, I got out before any of this nonsense started, but selling more shares does not hurt shorts, it dilutes anyone who is already invested.
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
Uh no, this takes pressure off the shorts by increasing the float. It also reduces Musk's credibility when he said just a week ago, "Well, we don't have any plans right now to raise funding." The amount Musk is personally buying is trivial: 1/4 the average daily volume, or about 1/15th of today's volume. Anyway it doesn't matter who buys the shares, it's still dilution whether Tesla retail investors understand it or not.
Vodafone (VOD +0.3%) views its Verizon Wireless stake as a more attractive long-term asset than its slumping European ops, and is thus loath to sell it, argues Bernstein's Robin Bienenstock in the wake of the carrier's FQ4 report (included major Y/Y drops in Italian/Spanish revenue). Bienenstock, no stranger to throwing cold water on deal expectations, also thinks Vodafone's remarks about keeping its new $3.15B VZW distribution are a sign Verizon (VZ -1.3%) won't be issuing fresh distributions in the near-term; recent comments from Verizon's CFO also back this up. [View news story]
My article details some of the history,:
http://seekingalpha.co...
and a forthcoming one may look at one option that I haven't seen considered yet.
Vodafone (VOD): FQ4 organic service revenue -4.2% (in line, but worst quarterly drop on record): -12.8% in Italy and -11.5% in Spain. Impairment charge of £1.8B in Italy, bringing total impairments for Spain and Italy to £7.7B for the full year during which sales were down 4.2%, to £44.4B and core earnings were off 3.1% to £13.3B. Adjusted operating profit beats, rising 9.3% to £12B. The company said it will keep its 45% share of Verizon's (VZ) dividend payment to shore up operations. [View news story]
Vodafone (VOD): FQ4 organic service revenue -4.2% (in line, but worst quarterly drop on record): -12.8% in Italy and -11.5% in Spain. Impairment charge of £1.8B in Italy, bringing total impairments for Spain and Italy to £7.7B for the full year during which sales were down 4.2%, to £44.4B and core earnings were off 3.1% to £13.3B. Adjusted operating profit beats, rising 9.3% to £12B. The company said it will keep its 45% share of Verizon's (VZ) dividend payment to shore up operations. [View news story]
Though I must confess, I thought the results might be even worse. The thing is, they haven't even begun to adjust for all the problems with India. Somebody used the media to engineer a good exit point here.
Galaxy S4 sales will top 10M next week (less than a month after launching), says Samsung (SSNLF.PK) co-CEO Shin Jong-kyun. The Galaxy S III took 50 days to crack 10M. Samsung thinks S4 sales could eventually reach 100M, or twice the 50M the S III has seen over its lifetime. Suppliers with decent exposure: RFMD, ANAD, PANL, QCOM, BRCM, SYNA. [View news story]
As for Skyworks, I think the GS4 win is offset by historical Apple reliance, whereas RFMD gains both as NEW customers... a fact which has not yet bet fully priced in.
Galaxy S4 sales will top 10M next week (less than a month after launching), says Samsung (SSNLF.PK) co-CEO Shin Jong-kyun. The Galaxy S III took 50 days to crack 10M. Samsung thinks S4 sales could eventually reach 100M, or twice the 50M the S III has seen over its lifetime. Suppliers with decent exposure: RFMD, ANAD, PANL, QCOM, BRCM, SYNA. [View news story]
Tesla Motors (TSLA) prices its offering of 3.393M shares of common stock at $92.24 per share. [View news story]
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
While the recent stock offering technically provides more availability for the shorts and dilutes the long, I think the actual impact is trivial. What really matters is the relative finances on each side.
Yes, I'd guess the squeeze will continue for a while (weeks?), but that doesn't necessarily mean TSLA's price will continue to elevate. The low-hanging fruit has probably already been seized, and the rebate rate is dropping over the past several days. That said, my guess could be completely wrong, and I wouldn't really care if it is. Who knows what Musk will say next week? He's certainly a great salesman, and those amongst the fan(atical)-base don't seen constrained by any quantifiable valuation metrics. Certainly more shorts trying to game the system and then getting burned could drive the price higher.
Like I said, it seems pretty clear that the best course is to just stay away until we're into the summer, and some perspective related to the actual business of selling cars and batteries has returned.
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
Hopefully you already know that short shares have theoretically unlimited risk, since there is no limit to how high a stock can be priced. The broker is ultimately on the hook for that, and since they don't want to be stuck holding the bill on a bad position, they will force the shares to be bought back if loss looks like it could exceed the client's available capital. This is how an unreasonably high share price can force a buy, leading to an even higher price and becoming a cycle called a short squeeze, whenever their is a high percentage of shares held short.
Investment banks get hefty sums for managing these stock sales. Driving prices outside market hours is fairly easy because of the light volume. They know the announcements are coming before the public, so they can use options to have hedges in place beforehand, thereby mitigating their risk. Companies like Data Explorers provide daily information on short positions which is not available to retail investors. Which speaks to your second question...
You won't know until after it's over. The most accurate info is the short data published by the exchanges on a bi-monthly basis, 3 days after the fact. Some of us can check the rebate rate (the cost to borrow shares for shorting) and that's a reasonable proxy. There was an attempt to reform the markets and have them publish daily short data (Reg SHO), but vested interests made sure that what was actually published wound up being completely unusable:
http://1.usa.gov/147W8hR
Cheers! :-/
Shares of Tesla Motors (TSLA) rip 12.9% higher premarket to $95.75 after the company files its mixed shelf and Elon Musk pours in some more capital. Reality check: Tesla now trades with a market cap just under 20% of Ford's valuation while selling only a fraction of the cars Ford sells indicating investors are betting either Tesla will become a "major" automaker or claim the highest margins in the industry. [View news story]
My article, Tesla's Matrix Moment, was meant as a fairly neutral piece of entertaining reading on the troubles that success will bring for Tesla, but of course it was largely blasted for for containing any negativity:
http://seekingalpha.co...
At least I called the dilution event correctly, despite Musk's comments to the contrary just a week ago. None of that outweighs the short squeeze, though. Just stay away until big money is done with it's frickin poker game.
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
Tesla (TSLA) takes advantage of its huge run-up to file a mixed shelf. Shares -2.9% AH. (S-3) [View news story]
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]
Tesla (TSLA) takes advantage of its huge run-up to file a mixed shelf. Shares -2.9% AH. (S-3) [View news story]
More on Tesla: The company announces it's offering 2.7M shares (current value of $244M) and $450M in convertible debt due 2018 in a public offering. Elon Musk plans to buy $100M worth of shares - $45M through the offering, $55M through a private placement. Tesla expects $830M in gross proceeds. TSLA now +6.8% AH. [View news story]