• Australian (ASX) Stock Market Forum

TLS - Telstra Corporation

Discussion in 'Stocks Q-Z' started by banjo_pete, Oct 31, 2004.

  1. banjo_pete

    banjo_pete Well-Known Member

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    With the LIB's having the power now to sell telstra, what will this do for tls??? do you believe it would be a buy if they sold it off??? What would the advantages and disadvantages???
    I will be looking at it as a long term hold. I think giving full power to the share holders and board will lead TLS into different areas.

    Anyone's thoughts??
     
  2. Lucstar

    Lucstar Well-Known Member

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    Re: Where will tls head???

    Well, johnny howard selling telstra would mean that it expand the growth potential of telstra. However, telstra is still limited (by law) to eliminate its competitors, although they are capable of doing just that. The next thing our economy doesn't want to have is have another MICROSOFT. I think whats limiting tls to its full potential is that its only limited to Australia. In my opinion, if telstra was too expand into international grounds, then we might finally see telstra lose its dog tag.
     
  3. RichKid

    RichKid PlanYourTrade > TradeYourPlan

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    Re: Where will tls head???

    The fact that the government wants a higher price for Telstra means it'll be doing everything it can to have the share price go up before the float in 2006.
    That at least is a bullish indicator. I think there are better co's around; good dividend yield though and it's at historic lows (or there abouts).
     
  4. RodC

    RodC Well-Known Member

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    Re: Where will tls head???

    Lucstar,

    Telstra has certainly made attempts at expanding internationally, without much success. Telstra now seems to have settled down to be a relative high yielding utility. Telstra has actually done quite well out of competition, many of their competitors use at least some of Telstra's network for their services. As a result much of Telstra's revenue has moved from the retail side to the wholesale division. In many areas the wholesale should be better margins as you don't need anywhere near the same number of customer support staff.

    Don't know what they can do to increase the share price, they're unlikely to be able to increase market share (due to the ACCC) and there's only so much more cost cutting they can do.

    Rod.
     
  5. RichKid

    RichKid PlanYourTrade > TradeYourPlan

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    Re: Where will tls head???

    Whatever happens keep your eyes and ears open since there'll be millions of reports and observations coming out in the media since a Telstra sale in now in play. Considering that this is a bull market, I don't now why you should stay in Telstra when there are plenty of other stocks running well and paying reasonable dividends- see the bottom drawer stocks thread for example. IF I held TLS I'd sell on any spikes heading towards $5.

    I heard the Treasurer say today that TLS will remain majority Australian owned and that he was looking for a price of at least $5 before a sale. When you have the fed govt trying to jack the price up and what will be an army of advisers and investment banks about to join in the float I don't really see how it'll not make $5, it's just that it'll take time and that means hanging on to a dud with just dividends for comfort when lots of other bluechips are running well.

    I basically don't think it is a well run company from what I've heard and see lots of resistance at $5, which limits upside. Better to look for value elsewhere. Sorry to be negative but just my opinion.
     
  6. RichKid

    RichKid PlanYourTrade > TradeYourPlan

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    Re: Where will tls head???

    But new technology like that used by Unwired Broadband will start to eat in. Even Optus has started aggressive marketing, recently announcing 3 to 4 months of free broadband access for bundling options.

    Can't say TLS 'service' is as good as it should be anyway, but at least it's improved since the bad old days! While the bush is still a political issue it'll also have to support those areas. But the current ACCC make-up may mean less aggression towards TLS than under Alan Fels - especially re: its behaviour towards smaller competitors.

    Exactly! 3G and new technology/markets is what they'll be looking at, but again it doesn't happen overnight and competition is still fierce.

    One way to stay ahead is not to get into the fanciful ventures they got into in Hong Kong for example with PCCW.
     
  7. still_in_school

    still_in_school Well-Known Member

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    Re: Where will tls head???

    TLS to $5.50..

    great possiblity.. have been trading turbo warrants and CFD's, after TLS made a close above $5.05.. but as of yet.. still looking to re-enter in again.. though missed my entry today.. when it trade back up above $5.20..

    though short term, $5.50 is possible...

    Cheers,
    sis
     
  8. markrmau

    markrmau Well-Known Member

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    Re: Where will tls head???

    IMHO the only reason tls is going up is because a number of brokerage firms have upgraded it, hoping for a slice of the action when the remainder is sold off. It is still the same old company with an aging copper network, the mobile market is saturated, people may start moving from fixed line to mobile as prices drop, and as stated above internet is moving to wireless.

    Thats no reason not to make money out of it while it is in favour though!
     
  9. Investor

    Investor Well-Known Member

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    Re: Where will tls head???

    Yes, TLS had a short price run when the big end of town were vying for the $600 million fees for T3 to be carved up.

    Looks like it was a short term 'support' as I expected.

    I do not see much SP growth for TLS because it will face many problems going forward. Example, VoIP will reduce its revenues significantly. It has also not resolved a non recourse debt of around USD 1 billion that is still owing by Reach (the bad business in HK that it had a JV with PCCW). The JV for Foxtel has already lost a lot of money and continues to lose money.

    Intense competition from just about every other player in the telco sector.

    I have read that American investors are not interested in T3. Based on international P/E's for telcos, TLS is probably still a bit overpriced.

    I do not hold. Bought T1 at IPO. Later sold. Avoided T2.

    I see more downside risk than upside potential.

    Brokers talk about the high dividend yields, without stressing that future DPS hinges on future EPS not falling and that DPS payout is already around 90% of EPS, meaning not much prospect for SP growth.
     
  10. Smurf1976

    Smurf1976 Well-Known Member

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    Re: Where will TLS head???

    Even Telstra's own technicians readily admit that the copper network has only been patched up for many years. That is, there is no real investment in the future of that part of their business and in due course infrastructure will fail thus necessitating either massive investment or withdrawal of the service.

    It's a bit like having a 30 year old car and only buying the minimum parts needed to keep it running and not doing any servicing. In due course you can't keep doing it that way.

    My guess is that the copper network is in due course abandoned in favour of optical fibre bulk data transmission and wireless connection to the end user.

    (I have never worked for TLS and do not hold stock but suffice to say that I'm very familiar with underground cabling and have periodic contact with their techs.)

    Also Telstra management is very "proceedure" based rather than practical.
     
  11. Investor

    Investor Well-Known Member

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    Re: Where will TLS head???

    Yes. I have read that as well.
     
  12. RichKid

    RichKid PlanYourTrade > TradeYourPlan

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    Re: Where will tls head???

    That's one of the price risks with TLS imo (both ways) as any future work for brokers (eg Seek or the like) may end up being a bribe for brokers to talk up Telstra in exchange for govt favours. Still the bad old behemoth it was a year ago, things don't change that fast for TLS.
     
  13. silent knight

    silent knight Active Member

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    TLS - when announcement expected?

    The new CEO of TLS should be announced soon. Does anyone know when?
     
  14. ghotib

    ghotib THIMKER

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    Telstra

    Anyone willing to say what they see in the tea leaves after Sol Trujillo's massive public relations blitz this weekend? Or did we all miss it?

    Having done my dough - I mean cunningly taken a capital loss - on T2, I don't have any opinions about Telstra's future, nor yet any advice for Sol. However, by coincidence last week I was reading one of the books about Lou Gerstner and his turnaround of IBM, so I was quite interested to hear Simple Sol's lack of enthusiasm for splitting Telstra. When Gerstner took over at IBM breaking it up was widely regarded as a possible solution to its troubles (much worse troubles than Telstra's) and some steps had actually been taken. He decided against that, although he did close or sell off some divisions. He also rightsized some 70,000 employees - but I guess Telstra can't do that, praise the pigs.

    Ghoti
     
  15. texinozz

    texinozz New Member

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    TLS Stock - What the ?????

    I am confused by this stock. It seems to have two types of investors, those that undervalue it & invest in it and those that love it & get scared and sell at the first point of problems. It doesn't make any sense to me why this is one of the highest traded stocks yet has very little movement (Over the last 50 days it has been $0.05).
    I don't understand how they can make a 4 billion dollar profit and get hammered. When the stock is reviewed most people are selling which would indicate that they were taking profit, yet most of the stock would have been bought at a higher price than what it is being sold at. Does this mean that there are inexperienced investors in the trade or large investors trying to control the price or people who do not want Telstra privatised and are controlling price. As i said I am very confused by this stock because even with the problems they are having I would have expected investor confidence and therefore the stock would be trending up on news of 4 billion profit.
     
  16. markrmau

    markrmau Well-Known Member

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    Re: TLS Stock - What the ?????

    Current profit was good, but future guidance is bad.
     
  17. Rockon2

    Rockon2 Well-Known Member

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    Re: Where will TLS head???

    Not sure about the FA of tls.. and im not a fan of theirs,
    But. TA suggests this support line will be held.. :)
     

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  18. Aden_1

    Aden_1 Member

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    TLS - Great buy?

    Hey all.

    Is it just me, or with telstras share price diving right now.
    due to all the speculation about the coming years profits .etc

    That is almost a great time to buy in?
    They are paying 6% div.

    Anyone have thoughts on telstra?
     
  19. Knobby22

    Knobby22 Mmmmmm 2nd breakfast

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    Re: TLS - Great buy?

    woof?
     
  20. raider

    raider Active Member

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    Re: TLS - Great buy?

    No I don't think it is a good time to buy.Second half profit lower and maybe
    worse to come, expect share price to drop to $4.50. Maybe better bet UNW
    running lots of adds now on TV and radio share price has nearly double in the
    last 6 weeks which I think is due to the fact that by next quarter they might
    be cash positive - I would not rule out that sp could hit a $1.00 or even more.
     
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