This has to be the cheapest stock I've seen far and wide lately, based on earnings and growth.
TNE was in a tender offer to be sold for $24-$26 a share to Telemar Participacoes SA, the biggest fixed-line operator in Brazil. Shareholders turned the offer down, this was a couple weeks ago.
TNE trades for 10 times earnings. I'll post more later.
Additional:
They are mainly fixed wireless in Brazil, with a small portion wireless and broadband. Growth is there, and it is CHEAP. Once it breaks $25 it should really be off the races. Some momentum guys will be getting in then. The chart looks ugly because of the buyout that was turned down, and people sold it off a little bit after the deal didn't happen. Now is time for turnaround. It could take a little bit but the uptrend has no reason not to continue, the value is very very cheap for a company that is still growing at this pace. To be honest I can't understand the valuation at all. This stock has much more business trading at $50 than $20.
Here...from http://www.moneymorning.com/2007/11/02/global-investing-roundup-6/
"In Rio de Janeiro, Brazil, yesterday, telecommunications company Tele Norte Leste Participatoes SA (TNE) reported its profits doubled in the third quarter. Tele Norte said that profits reached 637 million Brazilian reals, or $367 million, compared with 270 million reals ($155.7 million) in the third quarter of 2006. Not only did earnings leap compared to last year, they were well ahead of the consensus analyst expectations of BRL453.3 million ($261.67 million). Earnings before interest, taxes, depreciation and amortization (EBITDA) also jumped from $890 million in 2006 to $1.1 billion this year. Mobile phone subscriptions were up18%, to 14.9 million, while the number of fixed-line customers fell 1.9% to 16.70 million. Subscriptions to its broadband Internet service, Oi Velox, jumped 33% in the quarter, reaching 1.39 million users. In addition to the rising revenue, the company was able to reduce operating expense 8.3% - from $158.6 billion last year to $145.4 billion this. Total debt levels fell for Tele Norte as well, reaching $1.79 billion compared to prior year levels of $3.19 billion."
This is $0.82 a share for the quarter.
To be growing and still be valued at less than 10x earnings in an emerging market is silly. Either the market starts giving TNE a higher valuation by bidding it higher or shareholders will receive another premium via buyout. But I'm sure shareholders would turn down the offer again though. This valuation just doesn't make any sense to me.
Up 9% on strong volume today and regained it's 50DMA.
Nice, Sully. I sold this a couple months back for a loss but might need to get back in. I need to free up cash though i'm once again in the unfortunate situation of being fully invested.
TNE probably goes up after upgrade of Merrill Lynch
It is from yahoo TNE board nickname Male:
DJ Merrill Lynch Upgrades Brazil Telecom Oi To Buy
----------------------------------------------------- ---------------------------
Dow Jones Real-Time News for InvestorsSM
09:34 a.m. 01/07/2008
SAO PAULO (Dow Jones)--Merrill Lynch upgraded shares in Brazil's largest telecom Tele Norte Leste Participacoes (TNE), or Oi, to buy based on attractive valuations and the possibilities that a share restructuring at rival Brasil Telecom Participacoes may bring, said the investment bank in a report Monday.
Local press reports suggest that Brasil Telecom's controlling group could be working to restructure, which may set a precedent for Oi, whose controllers have failed in two restructuring attempts, said the report.
A restructuring could make Oi's evaluation at 2.5 times Ebidta for 2008 look even more attractive than at present, said the report.
It could also facilitate an eventual merger of the two operators.
Merrill set a 12-month price target of $26 for Oi's American Depositary Receipts and 83 Brazilian reals ($47.43) for Oi preferred shares.
Oi preferred shares were 4.8% higher at BRL34.89 in early trade on the Sao Paulo Stock Exchange, or Bovespa.
BIG breakout! BIG volume!
Does it have some more for tomorrow? I bought towards yesterdays high at 22.02 or something.
A couple charts:
Quote from: bjc on January 09, 2008, 08:27:56 PM
Does it have some more for tomorrow? I bought towards yesterdays high at 22.02 or something.
A couple charts:
It looks like it's got legs to me. I just hope you don't sell TKC, it's going to have it's day(s) too, hopefully very soon.
I love TKC Sully. The fundies are there for sure, and we just need some help from the market and the chart can start getting itself together. MICC is another great one along the lines of TKC and VIP. MICC in emerging markets like Africa and South America. 16 markets that they all expect major growth in......
Its only a matter of time before savvy investors come in and buy these depressed shares of these great companies. imo of course...
from Telegeography Database:
Brazil
Thursday, 10 January 2008
Telemar to buy back USD1.4bn worth of shares
Telemar Norte Leste, a subsidiary of Brazil's largest telecoms company by subscribers Telemar Participacoes, has revealed plans to buy back up to three million shares (voting and non-voting), equivalent to approximately 10% of traded shares during the year, writes BNamericas citing a company filing to the securities regulator CVM. It estimates the total value of the buyback could top BRL2.6 billion (USD1.4 billion).
Brazil stocks rise led by Telemar, real up on Fed
Thu Jan 10, 2008 4:04pm EST Email | Print | Share| Reprints | Single Page | Recommend (0) [-] Text
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SAO PAULO, Jan 10 (Reuters) - Brazil's benchmark stock index gained on Thursday for a third straight session led by a surge in shares of phone company Telemar and the national currency gained on expectations of lower U.S. interest rates.
The Bovespa index .BVSP of the Sao Paulo Stock Exchange rose 1.34 percent to 63,515.48 points led by a 13.6 percent jump in Telemar, the country's largest phone company, after its main shareholder confirmed talks to buy a smaller rival.
In the foreign exchange market, the Brazilian real BRBY strengthened 0.68 percent to 1.757 per dollar after Federal Reserve Chairman Ben Bernanke said on Thursday the bank is ready to act aggressively to counter a deep housing slump and credit markets strains.
Bernanke's comments signaled further interest rate cuts may lie ahead, which would boost the appeal of high yield emerging market securities like Brazilian bonds.
Stronger U.S. equity markets also helped boost Brazilian assets. The Nasdaq Composite Index .IXIC rose 0.56 percent and the Dow Jones industrials .DJI ended up 0.9 percent.
Interest-rate futures <0#DIJ:> were mixed in BM&F commodities and futures exchange in Sao Paulo as optimism over rising equity markets was partially offset by fears over the U.S. economy.
On the stock market, Telemar (TNLP4.SA: Quote, Profile, Research) jumped 13.6 percent to 44.1 reais. The company's controlling shareholder said talks to take over rival Brasil Telecom had "intensified" recently. For more, see [ID:nN10235729]
Brasil Telecom (BRTP4.SA: Quote, Profile, Research) fell 6.12 percent to 26.55 reais.
Vale (VALE5.SA: Quote, Profile, Research), the iron ore giant formerly known as CVRD, gained 3.09 percent 50 reais after Bernanke's speech helped ease concerns over an economic slowdown that could cut demand for industrial metals.
State-controlled oil giant Petrobras (PETR4.SA: Quote, Profile, Research), the heaviest weighted stock in the Bovespa index, fell 0.97 percent to 84.1 reais, its first drop in three sessions as crude oil prices dropped more than 1 percent. (Reporting by Elzio Barreto)
TNE continues to perform well.
Too bad I sold for a small gain a couple / few weeks ago. This is a good value and should continue to run.
update