I believe the shares of Occam Networks (OCNW) can quadruple over the next year with little to no fundamental risk at current prices. I think there is about $1 of downside and $15 of upside, and that’s about as good as it gets.
Q2 2010 Earnings Call
July 27, 2010 10:30 a.m. ET
This is the condensed version of a much longer article, which can be read on my Instablog here.
I believe the shares of Occam Networks (OCNW) can quadruple over the next year with little to no fundamental risk at current prices. I think there is about $1 of downside and $15 of upside, and that’s about as good as it gets.
Both Penson Worldwide (NASDAQ: PNSN) and Comtech Telecommunications (NASDAQ: CMTL) have issued recent earnings reports which include a calculation of EBITDA that apparently does not comply with Regulation G governing non-GAAP financial measures. As I will describe below, their EBITDA calculations include an erroneous adjustment for stock-based compensation costs.
How is EBITDA supposed to be calculated?
Q2 2010 Earnings Conference Call
July 27, 2010 9:00 AM ET
As always, during this difficult market period I am working hard at building my Watch List and keeping it up to date. That last part—keeping it up to date—is difficult right now because earnings season is again upon us. And that means a daily dose of big gaps up and down among growth stocks, depending on how investors react to and interpret the news.
Thus, if you are going to be doing a little nibbling on stocks here and there (and I don’t think there’s much wrong with that, assuming you have plenty of cash on the sideline), you have two choices. First, you wait for a company to report earnings, and then look to buy afterward if the chart and story are still intact following the report.
LM Ericsson Telephone Company (ERIC)
Q2 2010 Earnings Call Transcript
If you’re looking for undervalued foreign dividend stocks with good growth prospects, our latest screen might interest you. We screened for attractive valuation metrics, such as, low Price/Free Cash Flow and PEG ratios, and high future EPS. We also screened for attractive ROE, ROI, ROA ratios, dividend stocks with a dividend yield above 5%, and low debt. This screen returned 2 Asian dividend paying stocks and 1 Latin American Telecom dividend stock, all of which are now in our High Dividend Stocks by Sector tables:
· City Telecom HK (CTEL): Provides integrated telecommunications services in Hong Kong via its own self-built fiber network. CTEL has a subsidiary, Hong Kong Broadband Network Limited (HKBN), that’s the fastest growing broadband service provider in Hong Kong. HKBN offers a diversified portfolio of innovative products that service over 1,027,000 subscriptions for broadband, local telephony and IP-TV services. CTEL also has branch offices in Canada and Guangzhou. (Source: CTEL website)
Earnings: Q2 profits of $.58 vs. $.56 consensus and $.52 in Q2 last year. Profits jumped 11.5% Year-over-Year. If you account for the $2.3 billion employee severance program charge this quarter, Verizon (VZ) actually lost $.07 per share (see call transcript).
Revenue: Decreased a fraction of 1% Year-over-Year at $26.77 Billion vs. $27.11 Billion consensus, missing top-line expectations.
Linked here is a detailed quantitative analysis of AT&T Inc. (T). Below are some highlights from the above linked analysis:
Company Description: AT&T Inc. (formerly SBC Communications) provides telephone and broadband service, and the company holds full ownership of AT&T Mobility (formerly Cingular Wireless). AT&T Corp. was acquired in late 2005 and BellSouth in late 2006.
Fair Value: I consider four calculations of fair value, see page 2 of the linked PDF for a detailed description: