NCP - News Corporation

[Joe Blow]

NCP has been bouncing up and down in a trading range for months now. A lot of this has to do with exchange rate fluctuations etc.

This morning it is at $13.19 and it looks like it could be getting set to surge through resistance at around $13.20 and head towards the next resistance point at about the $13.50 mark.

Will it rally or falter once more?

Anyone have a view?

[JetDollars]

Hi Guys,

As you can see from the chart NCP seem to bounce back and for in the range. Do you think NCP is a good company for short-term trading?

[still_in_school]

Hi Jet$,

personally for me, the share has been going sideway's since May, and in the last several weeks it has been on a downtrend... since mid January to early April, the share has been channeling through $11.80 and $12.50, since then, the share found new support at $12.65 and broke the resistance, yet over the last several weeks the share has pulled back and lost support at $12.65 and at $12.50... just looking at the historical data, and since Feb 2000, NCP has been on a downtrend,

... also looking at the Share, there has been no dividend payout since April 2001...

IMHO, forget this one for the moment...

Cheers,
sis

[JetDollars]

Hey SIS,

If you are a channel trader will you consider this stock to be the one on your list?

[still_in_school]

Hi Jet$,

to be honest, i wouldnt bother with this share, its still on a downtrend and could be still several weeks before it finds support...

current shares, that are on my watchlist are...

ADZ, FXJ, BIL, LLC, SFE - these shares are only for the short term... though i have many confidence in FXJ & SFE, though still... they are only cents... away from my entry point...

... grrr... its just a matter of time... till i can pull the trigger on them....

Cheers,
sis

[Joe Blow]

I've traded NCP a few times this year and come out about even, mostly due to not bailing out when I should have a couple of times.

I find it's a good one to trade for the short term, just don't hang on to it for too long.

Buy it when it hits a support and sell it when it's about to strike resistance. In this respect it's a fairly predictable stock.

[Joe Blow]

News Corporation closed at $10.93, down 4.5% after the release of its Fourth Quarter earnings.

NCP has been channel trading for some time and considering it now seems to have broken through support at around $11.00, where does everyone think it will bottom out at?

My view is that it will continue to fall until around $10.50, which is an established level of support (April 2003).

[Redwing]

My2c and its only worth that, i like Newscorp and expect it to 'bounce' back as always. Have a friend who's buying all he can with his super.

REDWING

[stefan]

Have a friend who's buying all he can with his super.
Redwing,
How is he doing that? Does he have a DIY super fund?

Happy trading

Stefan

[JetDollars]

NCP now trading above $11.00, interesting to see where NCP heading today.

[Mega]

How is he doing that? Does he have a DIY super fund?

Year ago there was Your Prosperity but NAB closed them down. Recently I came across these (https://www.netwealth.com.au/super/default.asp) guys. Seems that will do the trick for you. They promise web interface to control your super soon.

[stefan]

Somebody is just dumping NCP like there's no tomorrow. Have you seen those sell orders hit at 10.9? Wow...

Happy trading

Stefan

[Bingo]

I am a holder of NCP, but struggle to understand which way it will go next. Some say it is oversold, but then does this take into consideration that maybe Australian funds are readjusting their holdings pending the move to the US and the indicators of an oversold position may not be valid.

The results look good and if you trust Murdocks' judgement that the move to the US will be positive on the share price then they look a buy.

I am not experienced in technical analysis. Can anyone tell me what the charts are saying?

Bingo

[GreatPig]

Bingo,

All the chart is really telling me is that it's at a point of indecision, trying to decide if it wants to go back up or keep going down.

I think it's a case of wait and see which way it breaks out.

Of course this is just my view, and not intended as any sort of recommendation.

Cheers,
GP

[Lucstar]

You guys might doubt me and i heavily doubt myself too, but i think this stock will fall to as far as $10.26.

[tarnor]

it does very much look poised to go either way but I feel its likely to go down to the next support. My novice guess is a 10.40 bottom before it starts heading north again.

[Bingo]

No going to $10.26 would not surprise me. I just think that NCP has this US move hanging over it and this may last for another year. The question is if the influence of the financial institutions will distort the share price over this period.

It's the impact of the whales (Financial institutions both in Australia and the US) that will drive the price and if we can understand the timing of the Australian institutions selling and the US institutions buying over this period then profit opportunities will arise. NCP is very big in the Australian context, but only medium in the US. I think this may imply that the the early reaction might be from the Australian institutions.

Is there an easy way of tracking the institutional shareholdings at regular intervals of time?

Bingo

[Bingo]

Note on Shaw Stockbroking site headed ABN-AMRO: BIL - Yeah baby...well done to the believers! The outlook?
1/09/04 By: Ben Smoker
(http://www.egoli.com.au/egoli/egoliWarrantsPage.asp?PageID=%7B98608FB6-B640-4A6D-B21B-AB8F1CDBCADE%7D)

Quote "NCP: Still no major offshore buyers stepping up to the plate in the Corp as yet. This really is becoming a waiting game into the vote mid-late October. In my view, play the 10.90 – 11.30 range but I would not be caught short as the risk must surely be to the upside if the vote gets up. ADR’s last night were subdued $11.09 in AUD terms.

Note in the AFR on Tuesday talking about local insto’s (the three biggest lenders of NCP scrip) having to recall their stock that they have out on loan to the shorters in the market to enable them to vote on the US reincorporation. (Vote likely mid-late Oct). Total borrowed stock is 300 mill shares. This may put a squeeze on the ordinaries as hedge funds might be forced to cover their shorts.

Additionally, it’s trading on an 05 EV/EBITDA of 8.6x [20% discount to L/T average]. But even more compelling is the fact that News Corporation trades at a significant discount to it US peers, c18% to Disney and c19% to Viacom (News Corp on a A GAAP basis). Management recently stated that it does not expect a significant difference between FY05 US and A GAAP reported earnings.

Get on board – medium term outlook:

NCPIZK 20-Jan-05 1100 Hot DELTA 61
NCPIZL 20-Jan-05 1300 Hot DELTA 36
NCPIZM 28-Jul-05 1150 Hot DELTA 60
NCPIZN 23-Sep-04 1150 Hot DELTA 38
NCPIZO 15-Jun-05 750 Instalment DELTA 89
NCPIZQ 2-Dec-05 750 Rolling Inst DELTA 90
NCPWZI 24-Nov-04 1300 Call DELTA 6
NCPWZJ 22-Dec-04 1200 Call DELTA 11 "

Any thoughts as to the reliability of opinion?

Bingo

[stefan]

You guys might doubt me and i heavily doubt myself too, but i think this stock will fall to as far as $10.26.

Well, i wouldn't trust the charts with this one. I see the main factor in the switch away from the ASX. As it was mentioned before, fund managers will heavily dump NCP and I for one have a feeling that we haven't seen the bottom yet. It was at 10.85 before rising above 11 again and I don't think that Lucstar is too far off with his 10.26. It is an additional risk to hold NCP during the transition as you certainly don't know what's going to happen and how the american investors will take it.

A bit of a gamble. Too hot for me. It has triggered my entry price alert but I didn't buy any. I rather wait and see for now.

Happy trading

Stefan

[Bingo]

I confess that even with all this good advice I bought NCP at $11.05. I just feel that the fundamentals are good and that this US move thing is depressing the price.

A bit like buy the rumour and sell the fact. In this case I have bought on the theory that when the vote happens either way the vote goes the price will rise because the uncertainty is removed. The price falls on anticipation and rises when it happens.

Time will tell if I am right.

Bingo

[Bingo]

I have not historically been a chart watcher and am not very skilled, however, it appears that some of the indicators have turned positive (DMI,MACD). I am becoming more confident. Please can anyone tell me if my interpretation of the chartes is correct.

Bingo

[GreatPig]

Bingo,

I don't know that there is any "correct" interpretation of charts, only educated guesses :D.

Still, here's the current state of NCP. It's sticking its nose up above the $11.25 resistance level again, but then it's done that a couple of times before just recently and didn't get any further. The short term moving averages are starting to turn up but haven't crossed yet (7 & 21 day). It crossed the PSAR level a couple of days ago though.

Make of all that what you will...

Cheers,
GP

[Bingo]

GreatPig,

Thank you.

Bingo

[Bingo]

Murdoch to join Netcom board-report
By CBS MarketWatch
Last Update: 10:48 PM ET Sept. 9, 2004

SAN FRANCISCO (CBS.MW) - Chinese telephone company China Netcom is about to seat Rupert Murdoch on its board of directors, according to a published report.

Murdoch, chairman of the media giant News Corp. (NWS: news, chart, profile), would become a non-executive director at China Netcom, and might even be tapped to chair the board's compensation committee, the Financial Times reported Thursday.

Beijing-based China Netcom in July filed listing application documents for a $1.5 billion initial public offering in Hong Kong and New York.

Bingo

[Bingo]

Now that NCP have gone over $11.50 I am feeling more and more confident. I see them well over $12 by the end of October (after vote).

This is only an opinion and (refer earlier post) I bought at $11.05.


Bingo

[Bingo]

Made $12.00 to-day. If there is any truth in the rumour that some big players are short then we could see $13.00 by end October.

[stefan]

Made $12.00 to-day. If there is any truth in the rumour that some big players are short then we could see $13.00 by end October.

Bingo, if there is any truth in this rumour then you may actually see $11 quicker than $13. If BIG players are short, then chances are that there is something fishy about it. I know you're speculating on a short squeez but for that the stock would have to gain more momentum before the vote about the US move. I can see you're pleased with its performance and so far I was wrong with my negative sentiments. But there are uncertain times ahead and BIG players normally don't like that.

Good luck with it!

Stefan

[Bingo]

The other possibilities always bring you back to earth. Agreed, but I will stick with my judgement.

My reasons were more associated with the fact that NCP sells at a P/E discount to it's US peers and what I consider it to have a good outlook for NCP.

I thought that Australian institutions were selling in anticipation of the change in domicile and that this was resulting in a short term drop in price.

After the move to the US the P/E would be adjusted upwards.

After all NCP is big in Australia and makes big headlines while in the US no would be taking any notice yet. They will not start to buy until after the change in domicile.

The last part of the logic was blind faith. Murdock is a smart operator and if he thinks the move to the US will increase the price then who am I to disagree.

The short term squeez is just a bonus.

Have a nice day.

Bingo

[stefan]

Bingo,

Don't get me wrong. I agree that NCP is a good buy for the future. It can only get bigger for now so your entry price of 11.05 is excellent. I was myself keen to get in below $11 but I put my money into another stock instead. Should NCP trade down again as I expect for the short term, then I'll make sure I can get a few too.

Happy trading

Stefan

[still_in_school]

Information Memorandam

[Bingo]

Financial Review

"Funds undecided on News vote
Sep 17
Ben Power

News Corporation's plans to relocate to the US state of Delaware received a lukewarm response from fund managers yesterday after further analysis of the company's information memorandum heightened concerns about corporate governance and the possible erosion of shareholder rights.

The concerns come as it was revealed that News Corp chairman Rupert Murdoch received a massive $US12.5 million ($18 million) bonus on top of his $US4.5 million salary last financial year.

The company on Wednesday released an information memorandum on the US relocation proposal ahead of a shareholder vote on October 26.

Independent expert Grant Samuel & Associates said the shift was in the best interests of shareholders, but the directly measureable benefits were "limited" and it warned of short-term share price volatility and "lesser protection for shareholders, especially minority shareholders".

Analysts said that while Mr Murdoch's US plans were largely on track, corporate governance issues were being taken seriously by shareholders.

BT Funds Management portfolio manager Scott Maddock, who has not declared how he will vote, said shareholders now had "something concrete" to guide them, "as opposed to inferences".

"The independent expert has come to the conclusion which I think most people would have come to already, that the benefits to News Corp and its shareholders of a shift in domicile are at best ambiguous," he said. "Consequently the benefits of voting for the move must come from other areas which are relatively hard to find in the information memorandum."

Another fund manager said: "Delaware is a bit of a nightmare for us [Australian institutions], but the Americans are quite used to it - more than half the S&P500 are incorporated there."

Still, "I doubt there will be enough concerned votes to overturn the whole deal as most see the greater good being part of the US."

News Corp has said if it loses the vote it will look at alternatives.

A major concern is the ability in Delaware for the News Corp board to issue stock with superior voting rights without existing shareholder approval.

"The proposal to empower directors to potentially issue super-voting stock is a substantial power in our view," JP Morgan analyst Oliver Ansted said.

Credit Suisse First Boston analyst Jolanta Masojada said a key disadvantage was "the ability of directors to issue new shares that potentially could rank ahead of the Class A or Class B shares in every manner and the loss of protection under Australia's more stringent takeover requirements."

A News Corp spokesman said it would remain listed on the Australian Stock Exchange and rights attached to the new stock required ASX approval.

"We don't have in mind ... a so-called 'super-voting' stock," he added.

"The differences between the two regimes are very, very thoroughly laid out in the documents that shareholders are yet to get," he said. "If we think there's a need for some sort of further disclosure [on corporate governance] we will consider that" but, "we're not of that view at the moment."

Analysts said that in Delaware News Corp would be able to attempt to stop a takeover through a "poison pill" shareholder rights plan or stock issuance.

Delaware law also does not include compulsory acquisition provisions, and makes it harder for shareholders to remove directors, while preferred stock will also lose liquidation preference and existing dividend preference.

Analysts said News Corp's $2.95 billion buyout of Queensland Press, which Grant Samuel declared "fair and reasonable" was no longer a big concern.

Meanwhile, the News Corp annual report revealed Mr Murdoch received an unchanged $US4.5 million salary and $US12.5 million bonus in 2004, against a $US7.5 million bonus in 2003."

Bingo

[Bingo]

Quote from Fairfas Digital - Trading Room

"GOING DOWN
Since the April announcement of News Corp's intention to relocate to the US, its preference shares have outperformed its head shares. The preference or non-voting shares, have historically traded at a 10 to 15 per cent discount to the ordinary shares. However, this has contracted to present levels of about 3 per cent. It appears only the preference shares will be included in the US indices, so US investors have been snapping them up. Standard & Poor's, which constructs the indices, generally takes the largest capitalised stock on issue, which in the case of News is the preference shares. The company believes it trades at a discount to major industry peers and will be positively re-rated by US investors. It has also stated that the relocation will reduce corporate complexity and provide access to a larger pool of capital. The October shareholder vote is the final major hurdle for the reallocation to take effect. "

I did not pick this one.


Bingo

[markrmau]

Any opinion on how low NCP will go? I'm thinking $10, perhaps even $9.

It does seem bizarre that most funds invested in it purely for index following reasons, and truly idiotic that the funds will desert at a loss purely because it will no longer be in the index...

[Mofra]

markrmau,

I'd speculate that in relation to the index some of the index fundies may be underweight in NCP, given the fall in price in recent months some of them may have been unloading stock in anticipation. Reading the Herald-Sun business section yesterday (not the greatest research material I'll admit) Shaw stockbroking say there's a 70% chance of the move to Delaware being approved, so your figures of $9 - $10 certainly wouldn't seem unreasonable.

Of course, if NCP was valued on Australian PEs rather than US PEs, they would have a rough fair value of $7.10 to $7.20 on 2004 figures.

Perhaps another opportuntity for a short coming up?

[stefan]

They are currently facing troubled waters, but on the long run I would think you can't go wrong with it. It has come to levels that will make it very attractive to longterm investors. It does still have room to fall further, especially if bad news continues to hit the wires. I do expect a rally once the decision has been made and it may be worthwile buying a few shares before then. I'm not in a position to enter it right now, but it's certainly getting very interesting.

Happy trading

Stefan

[markrmau]

Thanks Mofra,Stefan.

If we factor in the impending US currency crisis, I think it could go as low as Mofra suggests.

I take heart from all those who had confidence in MUL and will hold dispite a $2000+ paper loss.

Cheers,
Mark.

[still_in_school]

Hi Guys,

NCP has been one stock that i have been very closely monitoring, im very bullish on NCP, i know the stock keeps coming down... but after tomorrows meeting with the AGM, im certain for sharp bullish price movements... the road ahead could be very bumpy...

but at the moment, im just seeing uncertainly in the publics perception... i do believe, before the month ends.. .we will see NCP once again rally up to $12.00...

IMHO i am very bullish on NCP, with tomorrows after the AGM meeting.

Cheers,
sis

[still_in_school]

Hi Guys,

with some of my option monitoring on NCP, the other day some one bought 200 contracts 12 cents, they then further bought another 400 contracts more at 11 cents (600 in total), (also i confirmed with the broker, was that the same buyer of both large option parcels)

today someone just bought another 100 contracts at 6.5 cents

on NCP6S Nov $12.00 Calls theres an open interest of just under 10,000 O/I.

personally im holding a large position on NCP options, but i have spoken to many different brokers in the last couple weeks, who have given me the same unbiased opinion of what they think will happen to NCP, this has also been weighted up against my own opinion...

still remain very bullish.. but NCP at this level is very attractive for short and long term investors...

but be ready for the bumpy ride up ahead.

Cheers,
sis

[still_in_school]

Hi Guys,

just an interesting, to watch NCP after the afternoons 1 min pre-open... anyone can make sense of why another few million units of NCP shares were bought in, after the market was close...

is there some insider happening.. or is NCP set to really sky rocket and rally hard tomorrow...

Cheers,
sis

[still_in_school]

NCP - AfterMarket Depth + (Number of Units x Share Unit Price)

[tech/a]

Still

Broker cross trades settled after close.

Buyer and seller matched by the same broker.
Pretty common.

[still_in_school]

Thanks Techa,

just curious, for your thoughts on NCP, but also with such a large amount of units that have to be crossed with the brokers and their many clients in the number of units being matched...

would you think, this is a sure positive sign for NCP or not...?

Cheers & Thanks, and great to see you and your knowledge, shared on this site,
sis

[markrmau]

For those interested in NCP, the last day of ASX trading is Wed 3rd Nov. Also, on ABC's inside buisness web site there are some comments on the relocation.

I hold NCP.

[markrmau]

Did anyone see ncp close? $400M+ on close offer/bid. $1.3Billion over full day.

Cheers,
Mark.

[Lucstar]

I think we are seeing its turning point

[clowboy]

haven't really followed it all that much but I though that today was it's last day of listing.

Could be wrong.

[markrmau]

What the market giveth, the market taketh.

[RichKid]

For further discussion on Newscorp see stock code NWS (http://www.aussiestockforums.com/forums/showthread.php?t=1286) in this sub-forum or search for 'Newscorp'.