Just an investor

Cramer's Stop Trading! All Eyes on Verizon (4/27/09)

WSJ.... For Verizon, Land Lines Are a Hang-Up

By MARTIN PEERS

There comes a point in every secular decline when the business falls off a cliff. Has the phone industry's long-shrinking land-line business hit that point?

Verizon Communications reported Monday that first-quarter operating income from wire-line fell 34% to $691 million, a slightly bigger drop than AT&T's last week.

The plunge at Verizon is more significant because, unlike AT&T, Verizon doesn't fully own its wireless business. That means it can't as easily tap wireless cash flow to fund its roughly $5 billion annual dividend payout.

Verizon on Monday outlined measures to improve wire-line margins, including cost cutting. But there is a limit to how far and fast a business with high fixed costs -- like a telephone operator -- can cut to keep pace with rapidly declining revenue.

The profit plunge of the past two quarters was likely worsened by cyclical pressures, including higher pension costs related to the stock-market swoon. But, on top of customers canceling access lines, what may be hurting Verizon's margins is growth of its new FiOS network for TV, Internet and phone.

Given the high programming and marketing costs related to FiOS, its customers are almost certainly less profitable than old-fashioned phone customers. As Sanford C. Bernstein analyst Craig Moffett notes, "FiOS is doing a better job of replacing revenue than operating income."

And the capital costs of installing the service are helping wipe out wire-line's free cash flow. Still, that could change when the rollout is completed next year. Investors lately have focused on wireless growth. They shouldn't ignore the struggling wire-line operations.

Write to Martin Peers at [e-mail]

Swine Flu: Why You Can Ignore the Hype

You can look at the Asian SARS 2003 .. How is it affect the Asian Economies.. It is all depended on how serious is the swine flu as compared to the SARS... If it is airborne..and easily transmitted, this could be very serious in Mexico and its regional area. You can go back and look at the 2003 SARS in China.. and How its effect on the Hong kong stock market and Property market.

Possible Swine Flu Profit Trades

What about Rolenza? by Glaxo smithe klein GSK

Carlos Ghosn Speaks

How would they force the Japanese Automaker to jet up the price.. It is a free market with Competitive pirce. However, The Chinese BYD is coming out with a Lithium Electric Car that will cost less and have a longer range than the GM Volt. Better Place 's Agassi has already signed with many cities to build charging stations and selling battery car. His system is similar to the mobile phone company charging the usage of air time.. but in this case, it will charged with mileage usage. Once this is commercialize, the price of an Electric car will be much lower. Better Place is a much better system. You don't own the battery, if there is any problem with the battery. It will be replaced without a charge. However, GM wants to design a battery that will durable and will last for 10 years and this is a very far reaching task. Maybe this is the reason, the development is cost so much and the cost of GM volt is charging you US$40,000.

Preview from Europe: The Goldman Bounce

Totally agreed with you about the Chinese not too hot with the Dollar. However, it is no way out for them. If they don't buy the US treasury Bonds, the dollar will fall and create a panic to the global market on the Dollar. So they will have to buy them in order not to devalue its current holdings. It is no win situation for the Chinese.....
I am sure that the Chinese will be still buying the US Treasury bonds for awhile until this crisis stabilize and actually, they are already buying mineral assets, energy assets globally in preparation to offset the Dollar devaluation.

When Bad News Isn't Really Bad News

Any which way, housing price has dropped so much in one year and the 2x houses sold only reflects the market is dumping. It is a simple demand and supply curve. This is the equilibrium point because the price has dropped so much that the qty of houses sold increased. This does not reflect the housing market is good.

Australia & New Zealand Banking Group: Strong Balance Sheet Makes This Bank a Buy

"They already hold a 20% stake in two Chinese banks, the Shanghai Rural Commercial Bank and Bank of Tianjin. "

I am based in Hong kong. We got many China financial news but frankly, I have never heard of those 2 banks..

The Strategic Threats Facing Google

It has some good points.. but not in the near future...
But....
Does Google has any competitor at this moment in the market that would take a share of its market? The only threat is Facebook. But they are still finding a formula to generate some cash.... Google still has some miles to go

Why It's a Good Time to Buy Google

But if you look at it technically with the charts, it might not be the right time to enter now..