Titus Pullo
I came, I saw, I slept
join:2004-06-26 | Is it really short sighted investors?
or do these investors know something about future economic conditions that average Joe doesn't?
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"I am not young enough to know everything."
Oscar Wilde |
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RayW
Premium
join:2001-09-01
Layton, UT
clubs:
 ·XMission
| said by Titus Pullo  :or do these investors know something about future economic conditions that average Joe doesn't? No, it is the American way. Double digit returns today or else get rid of the executives. And if it means laying off half the working force to get the double digits, then do it. Never mind that the company is forecast to show TRIPLE DIGIT in 5 years, we want ours today, this minute.
This is the real reason China is winning. They do not care if they are getting a couple of percent today, it is still profit. They are building towards having control in 15-20 years and THAT is where they will rake in the returns. Ummm... Bill Gates sort of did the same thing in the DOS and early Windoze days, he wrote restrictive licenses, and then did not enforce them until today when Microsoft pretty much controls the PC software market.
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I am not lost, I find myself every time. |
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GOLFnSUN
Enjoy the sun
Premium
join:2002-03-03
Avalon, NJ
 ·Sprint Mobile Broa..
 ·Comcast
| reply to Titus Pullo
said by Titus Pullo :or do these investors know something about future economic conditions that average Joe doesn't? It appears "the Street" columnist is reading more in to a VZ stock price drop than it warrants. He says that VZ has been dropping since it's October high. But, in fact, since its low on Nov 27 it has been steadily rising.
But you do have a point. And that is that most investors(by volume of shares traded) are institutional investors, pension funds, and mutual funds. And these investors will drop a stock if they don't forecast at least a positive return in the intermediate term. And to some of them, obviously, they don't see Verizon profits so hot for a while. But they can move back in to Verizon later, when they expect Verizon profits to start rising again.
It really isn't the stock market that is the key to whether Verizon is going to stay the course or not on Fios. It is up to top management and whether they can convince the Board of Directors that investing in Fios will have a good ROI in the foreseeable future. If their business plan for Fios is believed, they will get backing by the Board. But if the Board thinks that management hasn't made a good case for getting a good return on Fios capital investments, then Fios could very well be severely slowed down, even if it is not stopped.
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BF69
join:2004-07-28
Camden, TN
| reply to Titus Pullo
said by Titus Pullo :or do these investors know something about future economic conditions that average Joe doesn't? Yes it is. See in the old days investors invested for the LONG term. Now everyone wants to make a quick buck. And to be honest that's just fantasyland crap someone has fed 99.99% of investors. Did Warren Buffet make his billions by chasing the quick buck? I don't think so. Who smarter, these guys or him? |
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tkdslr
join:2004-04-24
Pompano Beach, FL
·Speakeasy
| The existing infrastructure is going downhill..
The copper cables are deteriorating (or are saturated to limits), in a five, maybe ten years most of it will be useless for anything but a few DSL circuits.
I give my existing copper circuit no more than a couple of years (ontop of previous 5.5 years of progressively slower DSL service), after that it becomes totally useless for any DSL service. |
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deepblackmag
join:2004-12-27
00000
| reply to RayW
Re: Is it really short sighted investors?
Yes, today. because with the way investors and execs are running companys the economy wont be there in a decade. Short sighted isnt a powerful enough term to describe their stupid small minded anti-social behavior. In business school people are taught that the first last and only responsability is the bottom line. net rev has become the embodyment of all that is wrong with the american economy. not that many other countries are doing better these days, after being infected with the now ubiquitous viewpoint. The first responsability of any business should not be to its shareholders, executives, or employees, but to the society that ALLOWS it to exist and operate, and that means making choices that are not the best for the highly-flawed business meteric of choice (bottom line)
If we dont start investing in the future, not next month or year, but the long term future, decades and centurys, we simply wont have one. Look at many long standing japanese businesses. some have business plans set for 75 years in the future. No that doesnt mean they are inflexible, as any plan will be changed continuously, but merely that they have some foresight to invision their company in a long off time generations away.
The right choice may not always be the MOST profitable choice. Verizon might have made more money in the short term doing ADSL2+ and hybrid infastructure FTTN etc. but they made the more difficult right choice for the future of telecom infastructure in this country and chose to lay fiber. The small stupid shareholders will no doubt be furious that their returns will be smaller, however the country as a whole will be stronger, and more money will be made later.
Most business people are stupid greedy scoundrels. Well, maybe not, but certainly the ones i have met. Single mindedness toward a few poorly chosen numbers deciding the fate of thousands of familys livelyhoods. Complete lack of understanding of long term impact of current actions. They will never change until they are forced to change, and unfortunately for the rest of us, that will mean a complete breakdown of the existing economic mismanagement we enjoy today. A great man once told me that american business somehow succeeded in spite of itself. I disagree. I think american business is failing and just doesnt know it yet. Im just worried that nobody will see it until we crash into the ground from our meteoric fall from the top. Oh well. flame away. =P |
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Varlik
Without Honor You Will Never Be Free
Premium
join:2002-01-06
Anderson, SC
1 edit | reply to Titus Pullo
said by Titus Pullo :or do these investors know something about future economic conditions that average Joe doesn't? What they know is that they're not making as much money as they could if Verizon would give up on the FIOS Money Pit. After all it's the here and now that matters, just ask any BIG Money Investor. So what if America ends up looking like it's a 2nd world country living in the good old days of yesteryear.
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"Sir SIR! We don't use DHCP servers. We only use IBM & Microsoft servers." From there my call to tech support went steadily downhill.
--How about some Virtual Agents to put upon that Virtual Fence? That way they can Virtually stop them all. |
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kyramilan
join:2006-11-26
Pensacola, FL
| reply to Titus Pullo
Day Traders are SUCKERS!
That is what Institutional Investors call them. He-he, let's flood some "news" about the company we want to dump so the day traders will buy it.
CASH FLOW is one of the most important barometers of a company. VZ has a ton of cash flow. With all that FIOS investment, how are they doing it? Eliminating parts of that expensive copper plant for fiber (that a trained monkey could probably run as long as he has bananas).
Once the copper (and the useless areas VZ will sell-off) is gone, gee, how much cash flow will they have then? Triple what they have now. |
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BF69
join:2004-07-28
Camden, TN
| reply to Varlik
Re: Is it really short sighted investors?
said by Varlik :said by Titus Pullo :or do these investors know something about future economic conditions that average Joe doesn't? What they know is that they're not making as much money as they could if Verizon would give up on the FIOS Money Pit. After all it's the here and now that matters, just ask any BIG Money Investor. So what if America ends up looking like it's a 2nd world country living in the good old days of yesteryear. One again short term thinking. Are these guys 80 years old? Most are probally around my age, 38. Now assume I retire at 60 that's another 22 years. I'm not worried about what Verizon is like today tommorow or 5 years from now. I worry about what Verizon is like 22 years from now. And frankly if Verzion were to depend on DSL then they will be exactly nowhere in 22 years. |
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ashworth
join:2001-10-06
Pittsburgh, PA
·Verizon Online DSL
| reply to Varlik
Right, if investors want to be short sighted go invest in something else with bigger returns.... VZ isn't going anywhere....but if you want to invest in the future (FTTH) it beats ATT ADSL,Comcast Hybrid Fiber Coax or anything out there. Ya, it's going to take 5-10 years to wire the majority, but the network is in place for ANYTHING-voice, video, and data.....and they call themselves investors. |
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PDXPLT
join:2003-12-04
Banks, OR
| reply to deepblackmag
Analysts == salesmen for brokerage houses
Remember one thing: "analysts" get paid by their employers to do one thing: generate churn (and thus, commissions). Encouraging short-term trading; thrashing about based on whatever "news" available, is the reason they exist. So personally I don't give what they say much credance.
That said, Verizon does have an issue that they are making a large investion in FIOS, primarily to give it a capability Comcast, et al, already has. That is, to sell TV. This means they need to compete on price; not the greatest business to be in. Everybody on this site is ga-ga over FIOS as a provider of high-speed internet access, but selling commodity bandwidth isn't the greatest of business. To Verizon FIOS == a method to sell high-margin TV services.
Maybe they don't have a choice, since the MSO's are busy stealing their high-margin phone business. But that doesn't mean FIOS is a great business to be in. |
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mystic mage
@mindspring.com
| reply to tkdslr
Re: The existing infrastructure is going downhill..
wrong. I am a low voltage tech. I used to work for a electric company. it will take a hell of a lot longer. like 30+ years for that to happen. lets not forget your house is full of copper wire. I have yet to see a house built in the 50's burn down due to ageing wire with out something being wrong with it. cut wire. shilding chewed off etc. verizon's wire is safe. cable companies would suffer the same fate if that was true. All hardline wire i've seen is copper or aluminum. and the same with RG-6 wire running to your house from a cable company ped. |
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Light Guy
join:2006-05-12
Somerville, NJ
| reply to GOLFnSUN
Re: Is it really short sighted investors?
I copied this from a Verizon Newscenter Release:
NEW YORK - On Monday, Nov. 20, Idearc Inc. common stock will begin trading in the regular way market on the New York Stock Exchange (NYSE) under the symbol "IAR."
The previously announced spin-off of Idearc to shareholders of Verizon Communications Inc. (NYSE:VZ) was completed today, and Idearc now owns what were the Verizon domestic print and Internet yellow pages directories publishing operations. Verizon distributed a dividend of one share of Idearc common stock for every 20 shares of Verizon common stock held as of 5 p.m. on Nov. 1 (the "Idearc Stock Dividend").
This accounts for a 5% devaluation on Nov.20th Which would put Friday`s close near the 52 -week high. |
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