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Harvey Specter
22-01-2014, 10:23 AM
I am a US based individual investor YOu have got most of it right. A couple of points.
You say the government is not willing to help. I think National would help but it does not have enough support to do so. Fibre is one of its big policies from the last election so it will be unhappy to see how it has turned out. There is an election this year - probably November - so that will be interesting.
Re the ComCom (the commerce commission - the regulator) decision - this has been appealed and unusually, this means that the price now gets re-calculated under a completely different method. This is likely to be beneficial, but to what extent is unknown and will not be known for 2 years.
My veiw is they will struggle on without a capital raising hoping for a positive outcome from the Government or the ComCom appeal. A capital raising would not be good for teh reasons you state. A possible short term solution is for the Government to guarantee some debt, making the credit downgrade irrelevant.
Billy Boy
22-01-2014, 12:40 PM
But but but!! On the other hand, I see this stock as BUY.
Does anyone agree? I see everything (bad) is out in the air now. Things could get a lot better but not worse to the same extent?
Yep I do.....
BB
Billy Boy
22-01-2014, 12:40 PM
But but but!! On the other hand, I see this stock as BUY.
Does anyone agree? I see everything (bad) is out in the air now. Things could get a lot better but not worse to the same extent?
Yep I do.....
BB
BlackPeter
22-01-2014, 01:31 PM
Overall good summary of the situation. What you however don't mention is the so called "nuclear option" - it is my understanding that CNU is not required to offer the current service level (up and download speeds) for clients who just want to pay the budget (regulated / comcom) prices. They well could split their offer into a budget package (reduced up and down load speed and maybe reduced service courtesy to the consumer board) and into a premium package (high speed up / download as is) for clients who value speed and service and are prepared to pay a premium for that. This would significantly reduce the financial hit for CNU - and I would be surprised if they couldn't solve the remaining shortfall with paying slightly lower dividends for some years.
I am a US based individual investor who many years ago bought a small position in Telecom New Zealand. I sold a chunk of my Chorus shares on November 5th on the news, and the remainder at significantly lower prices to take a tax loss.
I just discovered this board, and will share my perspective on Chorus and hope you can provide me with some insights, as I will continue to follow Chorus should an investment opportunity arise.
Given the pricing decision, Chorus will have a substantial cash shortfall. As a result, Chorus must eliminate the dividend and make cost and service cuts. Even then Chorus will have a substantial cash shortfall. Unless the fibre rollout is to be stopped or delayed significantly (and nobody is talking about that), Chorus will have to come up with cash somewhere.
Politics appear to prevent overriding the pricing decision, absent a two year long review. Therefore, Chorus has to get the needed cash from: the government, increased debt, or issuing new shares.
From what I have read, the government is not willing to provide additional funding (politics, again). Crown Fibre Holdings has to live within its budget, and (I am not positive on this point) it does not appear they have the budget to just fund the Chorus shortfall. Chorus cannot issue debt to fund the shortfall because they will be too highly leveraged (debt was downgraded today and a negative outlook remains). That leaves only a new share issuance.
The problem with issuing shares is that 1) the stock has no dividend, making it less attractive. 2) if a dividend is maintained at a reasonable level (say 1/3 of the previous dividend), then the cash shortfall is that much greater and the issue must be larger. 3) The cash needed is large relative to Chorus’ market capitalization.
A stock issuance is unlikely without a dividend, and even with a dividend would be so large that the funds could only be raised at prices well below what Chorus has been trading at.
Why does Chorus not talk about delaying or stopping the fiber rollout to live within funds available, at least until the pricing review is done?
How are the politics likely to play out? Is one political party likely to cross over and agree to override the pricing decision, and if so, when would that likely be, given New Zealand’s election cycle?
I have seen a few folks post that all the bad news is out, or priced in or such. This is not just news - it is a serious cash shortfall that must be met, or plans changed a lot. Figuring out how the cash shortfall will be resolved is (to me) key to understanding where Chorus will trade, and when.
Do I have a good understanding of the situation Chorus is in?
Thanks for any help, and feel free to ask me any questions.
USbasedInvestor
22-01-2014, 01:32 PM
You say the government is not willing to help. I think National would help but it does not have enough support to do so. Fibre is one of its big policies from the last election so it will be unhappy to see how it has turned out. There is an election this year - probably November - so that will be interesting.
Any idea whether National could end up with a majority? Would that be a more likely route than one of the smaller parties agreeing with National?
Re the ComCom (the commerce commission - the regulator) decision - this has been appealed and unusually, this means that the price now gets re-calculated under a completely different method. This is likely to be beneficial, but to what extent is unknown and will not be known for 2 years.
The cash shortfall peaks in 2015, so even a favorable decision would be too late. Now, unless Chorus has been cooking the books and spending lavishly, a favorable decision is likely. However, I cannot handicap whether a favorable decision would repeal 100%, 75%, 50%, 25%... of the reduction. If the price reduction was passed on to end users, I am not sure how it could be retroactively applied so Chorus could recover the 2014 and 2015 shortfall. Is a quicker process possible? I have seen nothing to suggest it is, but we get limited news here!
My veiw is they will struggle on without a capital raising hoping for a positive outcome from the Government or the ComCom appeal. A capital raising would not be good for teh reasons you state. A possible short term solution is for the Government to guarantee some debt, making the credit downgrade irrelevant.
A guarantee is an interesting thought. Would that require political cooperation (more than just National) or can it be done without a vote? While it might get Chorus the cash, it would leave the shareholders at the bottom of an overleveraged company - and the guarantee only matters if the company fails. Incremental debt would diminish equity value, all else being equal.
EY contemplated a 2 year dividend hiatus followed by half of the prior dividend. I guess a govt guarantee, followed by a late 2015 capital raise where if the raise is successful the dividend is reinstated - might work to attract investors, but not above the present price. Given the size, I would guess such an offering would have to be at a substantial discount even in the presence of a dividend and favorable ruling.
I think struggle on for now is correct. In the states, the company would probably start winding down the spending and rollout to pressure the government to find a resolution more quickly.
mrjeems
22-01-2014, 01:36 PM
I think there are massive penalties if Chorus delay or stop the rollout. So that would be even worse for them.
USbasedInvestor
22-01-2014, 01:44 PM
Overall good summary of the situation. What you however don't mention is the so called "nuclear option" - it is my understanding that CNU is not required to offer the current service level (up and download speeds) for clients who just want to pay the budget (regulated / comcom) prices. They well could split their offer into a budget package (reduced up and down load speed and maybe reduced service courtesy to the consumer board) and into a premium package (high speed up / download as is) for clients who value speed and service and are prepared to pay a premium for that. This would significantly reduce the financial hit for CNU - and I would be surprised if they couldn't solve the remaining shortfall with paying slightly lower dividends for some years.
Wouldn't that have been an obvious potential solution addressed in the EY report? (Maybe it was, it has been weeks since I read it). Has this been discussed seriously by anyone of credibility? I have a hard time seeing this being consistent with the intent of the pricing decision. If it is, then the stock fell in half for nothing!
Harvey Specter
22-01-2014, 01:54 PM
Any idea whether National could end up with a majority?
If the price reduction was passed on to end users, I am not sure how it could be retroactively applied so Chorus could recover the 2014 and 2015 shortfall.
Is a quicker process possible? I have seen nothing to suggest it is, but we get limited news here!
A guarantee is an interesting thought. Would that require political cooperation (more than just National) or can it be done without a vote?
While it might get Chorus the cash, it would leave the shareholders at the bottom of an overleveraged company I have picked out a few questions:
1. The polls say it is 50:50 on whether National (right wing) gets reelected. It is unclear what Labour (left wing) would do if they were elected as IMO, letting CNU fall over is not an option for any party. They may take the opportunity to renationalise??? which would be very unfavaourable.
2. For this reason, I dont see the decrease being passed on to consumers.
3. I dont think so. why do your self out of a job by doing it quicker. My experience with Regulation is nothing is ever made easy by the ComCom.
4. I think a guarantee could be done by Cabinet, not requiring a vote in the house.
5. Being overleveraged in a regulated business is not actually a bad thing as the regulated price should ensure that you make a higher return that the cost of debt.
Bobcat.
22-01-2014, 02:48 PM
I won't be buying CNU until such a time that National looks set to win this year's election. Don't be surprised if Chorus mgmt are also pinning their hopes on a National-led Govt bailout.
John Key is lining up his ducks - he has Peter Dunne and United Future on board, has opened wide the door for Winston Peters and NZ First, and will soon turn his attention to the more numerous voting block associated with Colin Craig and his up and coming Conservative party. Once that Coalition is all in place well enough, CNU will again get my intention, and not until then.
National put the UFB ball into the political arena but never really kicked it much to my surprise. Well there goes a major NAT policy.
Harvey Specter
22-01-2014, 03:26 PM
John Key is lining up his ducks - he has Peter Dunne and United Future on board, has opened wide the door for Winston Peters and NZ First, and will soon turn his attention to the more numerous voting block associated with Colin Craig and his up and coming Conservative party. Once that Coalition is all in place well enough, CNU will again get my intention, and not until then.Key has also supported Boscawen for ACT leadership. Since when you you support the leader of another party? When you plan on gifting them a seat and want their support for a new government.
http://www.sharetrader.co.nz/attachment.php?attachmentid=5354&d=1390356934
Bobcat.
22-01-2014, 03:41 PM
Key has also supported Boscawen for ACT leadership. Since when you you support the leader of another party? When you plan on gifting them a seat and want their support for a new government.
http://www.sharetrader.co.nz/attachment.php?attachmentid=5354&d=1390356934
Your picture is almost apt. ACT are a dead duck - they are polling well under 1%.
Your picture is almost apt. ACT are a dead duck - they are polling well under 1%.
And Epsom is sick and tired of being a player in this political football game.
Harvey Specter
22-01-2014, 03:48 PM
Your picture is almost apt. ACT are a dead duck - they are polling well under 1%.Winning a seat with 0% party support is perfect as it would create a overhand in Nationals favour.
And Epsom is sick and tired of being a player in this political football game.They also know they will continue to do it if it is required to win.
Here is the new minister Dunne saying his appointment back to cabinet won't bring his support for RMA or employment contracts
http://www.stuff.co.nz/national/politics/9637835/No-Dunne-deal-on-RMA-reform
What he doesn't say is that he won't support government on over ruling ComCom on Chorus.
Sounds like he is signed up to collective cabinet responsibility on everything except RMA and Employment legislation.
So if the govt does want to over rule com com then it seems that they now have the numbers to do it.
I'm tempted to buy on this basis (but I already have a truckload bought at $2.86)
BlackPeter
23-01-2014, 01:37 PM
Wouldn't that have been an obvious potential solution addressed in the EY report? (Maybe it was, it has been weeks since I read it). Has this been discussed seriously by anyone of credibility? I have a hard time seeing this being consistent with the intent of the pricing decision. If it is, then the stock fell in half for nothing!
Here is a link for you to start - I am sure Mr Google can find more for you:
http://www.nbr.co.nz/nuclear
shonen knife
23-01-2014, 02:33 PM
Tempted to test my luck on this one...but every time I think about doing so I sleep on it and I wake up to find it has dropped.
spmcg
23-01-2014, 03:18 PM
And Epsom is sick and tired of being a player in this political football game.
As mentioned elsewhere, the good voters of Epsom have shown that they are in fact very happy (not to mention well-qualified) to decide on the next government.
brucey09
24-01-2014, 09:06 AM
Ola amigos
Am I thinking Chorus need NZGovt agreements for prices before result Feb 24? yes?
brentk
24-01-2014, 10:10 AM
Wouldn't that have been an obvious potential solution addressed in the EY report? (Maybe it was, it has been weeks since I read it). Has this been discussed seriously by anyone of credibility? I have a hard time seeing this being consistent with the intent of the pricing decision. If it is, then the stock fell in half for nothing!
My thoughts exactly. If the nuclear option is genuinely an option (and if it's not there are some clued up people who have been talking a load of bullocks) it's definitely where I would be focusing my discussions with the Govt & seriously considering rolling it out. IMO with sufficient thought & PR spin it could even come out as a relatively understandable & palatable outcome for the public ... although the usual Labour/Greens brigade will be railing away as they do about anybody in business or right-ish politics doing anything.
JAYAY
24-01-2014, 10:53 AM
My thoughts exactly. If the nuclear option is genuinely an option (and if it's not there are some clued up people who have been talking a load of bullocks) it's definitely where I would be focusing my discussions with the Govt & seriously considering rolling it out. IMO with sufficient thought & PR spin it could even come out as a relatively understandable & palatable outcome for the public ... although the usual Labour/Greens brigade will be railing away as they do about anybody in business or right-ish politics doing anything.
My thoughts exactly as well. EY may well have thought of it but weren't obliged to mention it, but how come Hooton and his mob didn't think of it.
As you say the PR spin would be easy given that it has emerged that main beneficiaries of the Comcom decision has been Vodaphone etc rather than the consumers.
USbasedInvestor
28-01-2014, 11:29 AM
I saw some discussion that the telecom companies might not pass the reduced pricing along to consumers. Is that now a fact, or just a point of discussion? It seems to me that lower pricing that does not get passed along also is not consistent with the pricing decision. Why mandate a reduction, if it does not reach consumers - unless the intent is just to distribute profits to a different corporation?
My understanding as to the politics is that the minority parties oppose govt overriding the pricing decision as they do not want to be seen keeping consumer prices high. I think it would be hard to spin a nuclear option as a positive. Consumer: so now to get the same performance we have to pay more?
There are a couple other topics I have not touched upon. First, after this govt fiasco, I decided to sell my Telecom New Zealand, and will certainly have some hesitation should I consider investing in New Zealand stocks (it is a big world, plenty of other places to look). Second, I have experienced fiber in the US, living in one of the first communities to get fiber to the house. This second point has lots of areas to discuss - the uptake, the deployment, consumer behavior, corporate pricing behavior, bundling services, customer support on older/lower speeds, etc. If folks are interested I can share what I observed.
Harvey Specter
28-01-2014, 11:46 AM
Retailers dont have to pass on the price reduction. And the fact that it could be recouped means most probably want. However, as their is competition in retail (where there isn't in network), the free market will decide if the price is passed on - a few of the small have said they will which may see them grow market share.
Politically it is difficult as you point out and we are in an election year which is going to be close. Unfortunately, politicians who live in 3 year windows, are unable to look at the big picture.
How has your internet use changed since you got fibre. What speed were you getting before compared to now. One issue in NZ is that we cant (legally) get services like netfix etc. iTunesNZ has a very limited catalog (no TV programs) so I, in breach of the contract, have a US iTunes account (you can do a similar breach with netflix buy you also have to get around the Geoblock, which isn't that hard).
USbasedInvestor
28-01-2014, 01:45 PM
How has your internet use changed since you got fibre. What speed were you getting before compared to now.
I think my internet usage has changed very little since getting fibre. That said, we only watch the occasional movie streamed via Netflix or Amazon.
People generally had a few choices: 1) dial up 2) DSL 3) Cable and then 4) fiber
I long had DSL service, and cannot tell you what the speed was, though generally believed to be less than cable. The initial fiber internet speed I got was 5mbps/2mbps (one is upload, one is download). Not too long ago, they had a promotion and I upgraded to 50mbps/25mbps. In day to day use I cannot tell any difference! If I download a large file - such as a software update - it is very noticeable, but for daily internet use it made no difference.
I generally use a desktop, hardwired to my router. However we also use iPads and iPhones and wireless notebook computers. The speed of those depends upon your wi-fi standard, and are usually well less than the theoretical maximum. I would look at the speeds you realize using wireless today and where you see bottlenecks. Can you stream video? We have as many streaming glitches at high speeds as we did at low speeds.
My fiber experience is more about the provider. Verizon was going to do a huge, fast rollout of fiber to the home. Then they discovered it was extremely costly, and while they got decent uptake, not everybody went all in for fiber. So the rollout got delayed because Verizon simply could not fund it. If folks were happy with their cable service, they generally did not switch. I regretted switching within days for tv, though the interest was improved. Verizon was selling bundled phone, internet and tv/cable. At first they had reasonable prices (and horrible tv menus, etc, but they fixed all that in time). Increasingly people have dropped home phone lines, just relying on cellphones or using a voip service (mine costs $3 per month for phone service). As this trend accelerated, Verizon began raising prices. In fact, you can drop your phone service now, and not save much money at all because they pretty much throw in phone to complete the bundle. The less you take, the higher the price for each individual service. $30 per month internet service (from memory) became $35 became $45, became $55. In not too many years.
They aggressively push you to higher services/faster speeds/etc. I have an early package they no longer offer. As a result, they will not fix things for me unless I switch to a higher priced package that they currently offer. I experienced a problem, due to the router being out-of-date. Since I would not update, they would only send me the exact same router. We had a fun game of them sending me a new out-of-date router every other day, and me returning it. All on their nickel, took just a few minutes of my time. After this went on several times, they sent me an updated router, which everyone on the higher data plans uses.
There are still a good number of folks using cable that have access to fiber. There are still a good number using DSL. Gamers require high speeds, but my 5/2 was more than adequate.
My experience then, is that the cost of fiber deployment is so high that the provider has to have significantly higher prices than were experienced in the market before. This creates an umbrella for legacy service prices to be raised. Which then results in more folks dropping their landline, etc. In the states we are experiencing folks dropping cable for the first time every (in total). It does not help that Verizon makes me click off an ad before I can watch tv - they are hungry for revenues anyway they can get it.
My thoughts exactly. If the nuclear option is genuinely an option (and if it's not there are some clued up people who have been talking a load of bullocks) it's definitely where I would be focusing my discussions with the Govt & seriously considering rolling it out. IMO with sufficient thought & PR spin it could even come out as a relatively understandable & palatable outcome for the public ... although the usual Labour/Greens brigade will be railing away as they do about anybody in business or right-ish politics doing anything.
Looks like a silver bullet choice.
I can't find the material now but I think from the get go Chorus (Ratcliffe?) indicated they pretty much just weren't going to go down that path. I think they want to achieve things in a different way, they must have confidence in what is and will transpire.
Regarding fibre/fibre uptake... by the time it's readily available around these parts (residential) I think it will become a necessity, with the performance of current DSL even if you wack an A or a V before it (ADSL/VDSL), will be thought of as dial-up is compared to DSL now.
Bjauck
28-01-2014, 05:34 PM
I saw some discussion that the telecom companies might not pass the reduced pricing along to consumers. Is that now a fact, or just a point of discussion? It seems to me that lower pricing that does not get passed along also is not consistent with the pricing decision. Why mandate a reduction, if it does not reach consumers - unless the intent is just to distribute profits to a different corporation?
My understanding as to the politics is that the minority parties oppose govt overriding the pricing decision as they do not want to be seen keeping consumer prices high. I think it would be hard to spin a nuclear option as a positive. Consumer: so now to get the same performance we have to pay more?
The way I see it is that the ComCom mandated a price reduction (for which Chorus has requested a full review) for the contract of supply from Chorus. This contract includes the "nuclear option". Chorus would be fully within in its rights and contractual obligations to reduce the bandwidth supplied down to the minimums it is contractually obliged to supply. In my opinion the ComCom itself has already released the nuclear option and Chorus' self-preservation defence of reducing speeds would be contractually sanctioned. If the TelCos wanted more bandwidth they would have to enter into a new contract at possibly the old prices as opposed to the reduced price - in other words the consumer would be paying the same price as they are paying at the moment.
If return on capital is unreasonable then NZ will never get anyone willing to invest in infrastructure unless it is guaranteed or financed by the taxpayer. Of course, I imagine the Greens would be in favour of that and a large state involvement.
USbasedInvestor
29-01-2014, 06:13 AM
The way I see it is that the ComCom mandated a price reduction (for which Chorus has requested a full review) for the contract of supply from Chorus. This contract includes the "nuclear option". Chorus would be fully within in its rights and contractual obligations to reduce the bandwidth supplied down to the minimums it is contractually obliged to supply. In my opinion the ComCom itself has already released the nuclear option and Chorus' self-preservation defence of reducing speeds would be contractually sanctioned. If the TelCos wanted more bandwidth they would have to enter into a new contract at possibly the old prices as opposed to the reduced price - in other words the consumer would be paying the same price as they are paying at the moment.
If return on capital is unreasonable then NZ will never get anyone willing to invest in infrastructure unless it is guaranteed or financed by the taxpayer. Of course, I imagine the Greens would be in favour of that and a large state involvement.
So what, then, is the minimum bandwidth under the contract, and how does that compare to what customers currently get? If they are similar, then the nuclear option is anything but nuclear.
Situations like this tend to get worked out, in time. Usually both parties make some concessions and a middle ground is achieved. While stock prices are irrelevant to corporate operations, the fact that Chorus stock has already declined so far means in any resolution, the dividend will be half or less of the prior dividend - simply because the stock price already anticipates that so why should any compromise agree to more?
Simply put, it is politically damaging to the minority parties if their support for ComCom meant that customers got less, or paid more. I still have a hard time seeing the nuclear option as being consistent with the decision and the politics.
Harvey Specter
29-01-2014, 07:34 AM
Minimum is about 2x dial up so 100kb I think. Adsl and vdsl can be over 2 and 5mb I think so significantly different. Vdsl, if you are close enough to the exchange is comparable to the entry level fibre.
I agree with CNU, don't threaten nuclear, keep it up your sleeve for the ambush. And ideally, only in areas where fibre is an option.
USbasedInvestor
29-01-2014, 08:06 AM
Thanks, Harvey Specter. I agree about not threatening. Nothing good comes from that. It should only be a last resort.
Now, how widespread is DSL in use? If most have 100kb, then nuclear is not even an option. If most have DSL, then it is. This is why this nuclear option confuses me: if most folks have 100kb, the price cut hurts Chorus. If most people have DSL service, then there was no need for Chorus to make grim statements about cash flow declines as they could simply lower the price of 100kb (serving few) and maintain DSL pricing (serving most) at present levels. Why be Chicken Little and cry the sky is falling if in fact it is not?
That logic suggest to me that most use the 100kb option, and hence the nuclear option is not what it is cracked up to be. Am I missing something?
(It has been awhile, I had completely forgotten that DSL also varied based on your distance from the Central Office.)
Harvey Specter
29-01-2014, 08:32 AM
Now, how widespread is DSL in use? If most have 100kb, then nuclear is not even an option. If most have DSL, then it is. This is why this nuclear option confuses me: if most folks have 100kb, the price cut hurts Chorus. If most people have DSL service, then there was no need for Chorus to make grim statements about cash flow declines as they could simply lower the price of 100kb (serving few) and maintain DSL pricing (serving most) at present levels. Why be Chicken Little and cry the sky is falling if in fact it is not? I'd say most of the country is on broadband, not dial up which means they are getting speeds of 1Mb/s+ depending on how close to the exchange they are. As such, dropping back down to near dial up speeds would not be an option as even basic sites like facebook would become slow.
I am not close enough to the exchange to get VDSL so will never get near fibre speads using copper. Luckily I should have access to fibre by end of the year
One thing to remember is that high speed broadband over copper is really only highspeed download, upload is normal about 10% of that speed, so fine for youtube etc but not perfect for online backups, HD video conferencing etc.
Rather than making numbers up, here is actual speeds:https://www.truenet.co.nz/sites/default/files/HS%20BB%20Perf%20Dec2.png
Source: https://www.truenet.co.nz/articles/december-2013-broadband-report
Note that only Wellington and Chch have access cable so less than 1/2 the population and it will surely be decommissioned once fiber is available.
mrjeems
07-02-2014, 09:16 AM
http://tvnz.co.nz/business-news/standard-poor-s-warns-chorus-over-debt-5824753
TimmyTP
07-02-2014, 09:43 AM
Encouraging signs from the ComCom today, about their intention to come to a relatively quick conclusion on the FPP:
"The Amendment Act requires us to make reasonable efforts to complete the price review determination by 1 December 2014. Our proposed process is designed to complete the UBA price review determination before this date."
Even if they come up with a price unfavourable to Chorus, at least we might learn what it is by the end of the year.
Harvey Specter
07-02-2014, 10:00 AM
Agree - the timetable is promising. It would be good to see some actual broker comment on this. I note:
Its initial view is that it will use Chorus's copper network and potentially the rural broadband initiative's fixed wireless in its modelling to determine the price.
http://www.sharechat.co.nz/article/f861de94/comcom-kicks-off-uba-final-pricing-principle-process.htmlIs this good/bad/indifferent? I wonder why they aren't using the fiber rollout in the model, even if they use the other providers costs, not CNU, for independence purposes. I would have though rolling out fibre was more akin to cooper than a wireless method.
Balance
07-02-2014, 10:36 AM
http://www.stuff.co.nz/business/industries/9695943/Capital-raising-tipped-for-Chorus
Rights issue and cut in dividend on the way according to J P Morgan.
couta1
07-02-2014, 10:44 AM
http://www.stuff.co.nz/business/industries/9695943/Capital-raising-tipped-for-Chorus
Rights issue and cut in dividend on the way according to J P Morgan.
Very hot potato,wear protective gloves,traders can take the week off now and go to the beach if they bought last week
Xerof
07-02-2014, 10:50 AM
Rights issue and cut in dividend on the way according to J P Morgan
no surprise, this was mooted on here as the only way through, months ago.
This is the only option available, to avert S&P downgrade to junk status within 3 months, and bank covenant breaches
they don't want that!
brucey09
07-02-2014, 12:21 PM
Snrs.
Timed complete after election - yes? Clever yes?
Casino
07-02-2014, 12:34 PM
Snrs.
Timed complete after election - yes? Clever yes?
No that must be a coincidence.
Harvey Specter
07-02-2014, 01:09 PM
Snrs.
Timed complete after election - yes? Clever yes?
No that must be a coincidence.The date is based on the date the new rate takes effect - 1/12/2014.
Given they originally thought it would take them two years, this is a very tight timeframe so bringing in any conspiracy theories seems a bit over the top. We should actually be questioning whether it is a realistic timeframe or in the true spirit of a government organisation, will it run over time and over budget (actually the same could be said about CNU fiber roll out).
nextbigthing
07-02-2014, 01:42 PM
I'm sure this has been covered before but I can't find it - something I don't get, they're unsure of what model to use to determine the fair cost of fibre and therefore the price they can charge, whether it be an international pricing model etc, but why don't they just use the actual cost incurred as they lay it as we speak - making sure it's done in a fair manner.
Harvey Specter
07-02-2014, 02:00 PM
I'm sure this has been covered before but I can't find it - something I don't get, they're unsure of what model to use to determine the fair cost of fibre and therefore the price they can charge, whether it be an international pricing model etc, but why don't they just use the actual cost incurred as they lay it as we speak - making sure it's done in a fair manner.The regulated pricking is all about the pricing of the existing cooper, laid decades ago, not the current fibre which is being rolled out now.
Any reason for an 11% spike with dilution and dividend cut looming?The proposed timeline will give more certainty from the date of the change rather than a big unknown for an unknown period of time.
Bjauck
07-02-2014, 02:01 PM
Any reason for an 11% spike with dilution and dividend cut looming?
I was wondering the same...all I can think of is that the FPP review may be realeased earlier than anticipated, removing a little uncertainty sooner. Such a rise in CNU price is surprising as JP Morgan are forecasting a more stringent dividend cut than the 50% cut anticipated earlier.
One thing remains the same for CNU is that it will be a regulatory, political and financial football for some considerable time to come!
brucey09
07-02-2014, 02:03 PM
The date is based on the date the new rate takes effect - 1/12/2014.
Given they originally thought it would take them two years, this is a very tight timeframe so bringing in any conspiracy theories seems a bit over the top. We should actually be questioning whether it is a realistic timeframe or in the true spirit of a government organisation, will it run over time and over budget (actually the same could be said about CNU fiber roll out).
si.
And the first date also.
Xerof
07-02-2014, 03:01 PM
Any reason for an 11% spike with dilution and dividend cut looming?
1. the CC timeline is about 12 months sooner than required - positive in that most think they will provide a much higher copper price than that which they have decreed will take effect from December 2014. If thats the case, then smooth sailing......
2. the threat of a ratings downgrade is removed. The Agencies will probably put them back to stable from negative
2a. They get the banks off their case as well
3. new buyers will now want in, to take advantage of the perceived discount that seems to be on the cards in the rights issue
4. If all of the above is correct, then the pall of gloom might be lifted, and CNU can get on with the job at hand
5. Do you think dividend cut and dilution weren't already well priced in?
Bjauck
07-02-2014, 03:14 PM
1.
5. Do you think dividend cut and dilution weren't already well priced in?
A dividend cut of 50% had been mooted earlier. JP Morgan are now forecasting a dividend "holiday" followed by 5c dividend therafter. I think 5c pa equates to a dividend at 25% of the current level. Obviously this is just a forecast by one outfit.
However in light of the ComCom announcement maybe JP Morgan may adjust its dividend forecast, provided the result of the FPP is favourable to CNU.
nextbigthing
07-02-2014, 03:30 PM
I appreciate they're trying to work out what price they can charge for copper - my question wasn't very clear. Why do they need to build a model for pricing - can't they base it on the fibre rollout which probably provides the best approx replacement cost?
nextbigthing
07-02-2014, 03:34 PM
Any reason for an 11% spike with dilution and dividend cut looming?
My opinion - the price was irrationally hammered given a monopolistic asset that eventually was going to get sorted out. People were expecting dilution and two years of no dividend followed by something more like 5%.... The outcome is now appearing not so bleak so it's a correction for the oversell.
Harvey Specter
07-02-2014, 03:41 PM
I appreciate they're trying to work out what price they can charge for copper - my question wasn't very clear. Why do they need to build a model for pricing - can't they base it on the fibre rollout which probably provides the best approx replacement cost?I raised the same question in post2218, especially since they want to make reference to the rural wifi rollout.
CNU must also have actual costs, at least for parts of its network as it will still be rolling out copper to new subdivisions etc.
I am sure CNU will raise all these types of points and knowning that a judicial review is likely, the CC will need to cover each one off with a high degree of robustness.
brucey09
07-02-2014, 03:46 PM
Snr. Harvey specter
correcto
#2234
Wouldn't they just put Fibre into new subdivisions, all services would be underground in any case, allthough there maybe copper in parts leading to the subdivision - depending on how far away an "exchange" is ??
Harvey Specter
07-02-2014, 04:21 PM
Wouldn't they just put Fibre into new subdivisions, all services would be underground in any case, allthough there maybe copper in parts leading to the subdivision - depending on how far away an "exchange" is ??I meant over recent history but you do raise an interesting point. I think they are still required to connect all houses to cooper, even if they also connect to the fibre (or at least give them the option which would require running copper past the driveway).
bung5
07-02-2014, 04:23 PM
#2234
Wouldn't they just put Fibre into new subdivisions, all services would be underground in any case, allthough there maybe copper in parts leading to the subdivision - depending on how far away an "exchange" is ??
Do the telcos have a mainstream voip solution to replace the copper telephone yet?
Harvey Specter
07-02-2014, 04:27 PM
Do the telcos have a mainstream voip solution to replace the copper telephone yet?I understand that Telecom doesn't which is causing issues with installs as planning laws only allow one cable to be strung to the house, not two, requiring a new copper/fibre hybrid cable to be used. I think all the others use a Voip product. Happy to be proved wrong.
Xnet does, and orcon do - some or all of the new sub-divisions in Chch have fibre laid and they are contracted to xnet only - so if you move into a new subby in chch you're getting xnet fibre + voip. I'm not sure if this is the case since the earthquakes but it was so in the year or two before them (as I understand it from friends at xnet). Stonefields (new subdivision in Auckland) has fibre laid also and i'm not sure if they are connected to copper also, it may be an option but my friend who bought a house there didn't mention it - though I believe they have a choice of providers as they were initially on xnet fibre+voip but are now with orcon fibre+voip from memory
brentk
08-02-2014, 01:24 PM
Wouldn't they just put Fibre into new subdivisions, all services would be underground in any case, allthough there maybe copper in parts leading to the subdivision - depending on how far away an "exchange" is ??
The new large Millwater subdivision north of Auckland (Silverdale) partially populated / currently being built has fibre only - i.e no copper.
couta1
10-02-2014, 11:44 AM
Someone selling up big time today 2 lots of 1.5 mill gone through off market
brentk
10-02-2014, 01:45 PM
And still she rises ...
Mista_Trix
10-02-2014, 06:31 PM
Someone selling up big time today 2 lots of 1.5 mill gone through off market
Couta1 we all are very aware of how burnt you got, but there's no need to downramp.
You know very little about investing and have shown this several times, please only make commentary on the CNU thread if its not just you venting at the stock. Happy to hear if you've got something useful to add - positive OR negative if its well thought through commentary.
couta1
10-02-2014, 06:42 PM
Couta1 we all are very aware of how burnt you got, but there's no need to downramp.
You know very little about investing and have shown this several times, please only make commentary on the CNU thread if its not just you venting at the stock. Happy to hear if you've got something useful to add - positive OR negative if its well thought through commentary.
Not downramping just happened to be online at the time and noticed those 2 big lots going through and thought it was probably an overseas seller,actually if my money wasn't tied up in Xro I would have done a trade in CNU last week but have no intention holding it long term again due to its vulnerability to political influence both now and in the future,sure I've made mistakes through over enthusiasm etc but to say I know very little about investing when I hold a portfolio in excess of 1 mill is a bit rich I think,cheers
stoploss
10-02-2014, 07:55 PM
It's not so much how much you have . More like what you started with and what it's worth now.
That guy Trev that won 26 mil on the lotto ,by your logic would be an investment guru .
couta1
10-02-2014, 08:10 PM
It's not so much how much you have . More like what you started with and what it's worth now.
That guy Trev that won 26 mil on the lotto ,by your logic would be an investment guru .
I did well out of fixed terms,bonds and resets and the share market has been a steep learning curve bar the retirement sector stocks and its takes time to work out which style works for you with shares,I didn't win any of my money just hard work and mainly good investment choices bar Hanover and co and Chorus as it turns out and I guess there will be a few others in the future
nextbigthing
10-02-2014, 09:24 PM
Someone selling up big time today 2 lots of 1.5 mill gone through off market
Someone buying up big time Couta. Glass half full mate.:t_up:
Mista_Trix
10-02-2014, 09:31 PM
The guy points out a major share transfer and suddenly it's downramping. Same thing on PEB would be up ramping. If I drive my car up onto the highway near CNU HQ is that on ramping?
Personally I'm glad couta pointed it out to show there is still an overhang from overseas boys selling out (most likely). Watch out for an SSH.
Go through and have a look at what he's posted in relation to this company. It's always very, very negative, sure fine happy to hear it if there's analysis behind it. But its confirmation bias - finding evidence to support your pre-existing views. On up days he's said things like -watch out it'll probably fall now, not based on anything other than his blisters.
We all know how badly the burn hurt, all I'm asking for is calculated input. Yours is great - shows considered views, his is unfortunately looking to say 'I told you so', which even if it is a bad investment, is a little silly on a stock you nolonger own or care for.
couta1
10-02-2014, 09:39 PM
Go through and have a look at what he's posted in relation to this company. It's always very, very negative, sure fine happy to hear it if there's analysis behind it. But its confirmation bias - finding evidence to support your pre-existing views. On up days he's said things like -watch out it'll probably fall now, not based on anything other than his blisters.
We all know how badly the burn hurt, all I'm asking for is calculated input. Yours is great - shows considered views, his is unfortunately looking to say 'I told you so', which even if it is a bad investment, is a little silly on a stock you nolonger own or care for.
Your reading far too much into this it was a simple observance into a couple of large transactions I noticed and shorely others are entitled to know that, do you really think my observance can affect the stock price?What I posted in the past has nothing to do with today's post,I have moved on from there,cheers
nextbigthing
10-02-2014, 09:47 PM
do you really think my observance can affect the stock price?
No one mentioned this Couta. Is that what you were trying to do?
We know some funds want to cut the loss and move on to keep clients happy. Makes sense, that's why they sell. The interesting point is I reckon Couta, someone thinks this stock is worth buying up big at this price. Who is this person/firm? They've obviously done some analysis and view it as an undervalued asset.
couta1
10-02-2014, 09:54 PM
No one mentioned this Couta. Is that what you were trying to do?
We know some funds want to cut the loss and move on to keep clients happy. Makes sense, that's why they sell. The interesting point is I reckon Couta, someone thinks this stock is worth buying up big at this price. Who is this person/firm? They've obviously done some analysis and view it as an undervalued asset.
I thought saying someone is down ramping is the same as saying someone is trying to affect the stock price but using different words? I'm sure the Chorus share price will continue to rise on any piece of good news and one persons rubbish is another's treasure
notooshabby
10-02-2014, 09:57 PM
Yes will be interesting to see if it triggers any SSH notices later this week. Thanks for pointing out the large trades Couta ;)
Read: Milford buying up with too much money on hand!
Wouldn't be surprised to see an SSH from them soon, as per above.
nextbigthing
10-02-2014, 10:05 PM
Read: Milford buying up with too much money on hand!
Wouldn't be surprised to see an SSH from them soon, as per above.
Exactly my point Couta. We know why people are selling. But why not think about who bought nearly $7 million worth of shares today and why. If it's Milford then that's pretty good news, their track record is generally pretty dam good. The point being this big trade could be a positive sign for you to consider....
Ps Moosie, I see your little comment about my lovely mother on the PEB thread. Believe me it is very tempting to engage in a tit for tat of witty remarks, however I shall refrain from clogging the boards, no matter how tempting it is to mention any one of the million comebacks I'm thinking right now ;)
biker
11-02-2014, 05:32 AM
Go through and have a look at what he's posted in relation to this company. It's always very, very negative, sure fine happy to hear it if there's analysis behind it. But its confirmation bias - finding evidence to support your pre-existing views. On up days he's said things like -watch out it'll probably fall now, not based on anything other than his blisters.
We all know how badly the burn hurt, all I'm asking for is calculated input. Yours is great - shows considered views, his is unfortunately looking to say 'I told you so', which even if it is a bad investment, is a little silly on a stock you nolonger own or care for.
I think this is an accurate observation. I don't mean to underestimate Couta but I think this fairly reflects what's been happening.
couta1
11-02-2014, 07:47 AM
I think this is very an accurate observation. I don't mean to underestimate Couta but I think this fairly reflects what's been happening.
Message received no more simple observations of significant stock movement numbers just piss off and keep it to yourself
jamiec26
11-02-2014, 09:05 AM
I was reading over the ComCom Issues paper dated the 7th of Feb.
Couple of things. The detailed schedule of activities.. The Final determination date is 30 November 2014. I understand things take a while to sort out. but this means that the ComCom ambivalence will have lasted well over two years. It's hardly a good look for New Zealand business and foreign investors.
Also I see that the ComCom is inviting opinions before the 21st of Feburay. Is anyone submitting a view in the eye of the shareholder?... If i was a word smith i'd have a crack..
Happy Day's team.
JAYAY
11-02-2014, 09:17 AM
I was reading over the ComCom Issues paper dated the 7th of Feb.
Couple of things. The detailed schedule of activities.. The Final determination date is 30 November 2014. I understand things take a while to sort out. but this means that the ComCom ambivalence will have lasted well over two years. It's hardly a good look for New Zealand business and foreign investors.
Also I see that the ComCom is inviting opinions before the 21st of Feburay. Is anyone submitting a view in the eye of the shareholder?... If i was a word smith i'd have a crack..
Happy Day's team.
I think they only really want submissions from the big players.
Submissions from the peanut investors will be ignored.
Ps. "Ambivalence" is too kind. I like "Bumbleling" better.
nextbigthing
11-02-2014, 06:40 PM
Hey Biker,
You pretty accurately picked the peak exit time for CNU, nicely done. What are your thoughts on the stock for a re entry now given it's amongst half the price?
biker
11-02-2014, 06:56 PM
Hey Biker,
You pretty accurately picked the peak exit time for CNU, nicely done. What are your thoughts on the stock for a re entry now given it's amongst half the price?
nbt, CNU is just too hard for me. I have been back in since my earlier exit but have decided l cant get a handle on where the share price should be so I have taken a small profit and now don't hold any and am going to wait until the cash issue idea is announced or ruled out then reconsider with a view to picking up some rights. It may well be good value at around 1.50 and if so, good luck to holders, but I dont have the stomach for it any more and have put my money elsewhere meantime.
nextbigthing
12-02-2014, 09:28 PM
From the letter to shareholders dated 11 December 2013;
'We do believe that a credible review when completed could mean that for the combination of services regulated by the Commission, Chorus could charge prices around or even above current levels, significantly above the results from the Commissions benchmarking approach'
That's a very big statement to make. The letter seems positive in general barring any more unforeseen political activity, including the possibility of earnings actually higher than before. It seems to have quietened down somewhat on the political front.
Does anybody know the timeframe/progress for the Crown Fibre negotiations?
nextbigthing
22-02-2014, 11:18 AM
Any thoughts on how the latest telecom/spark announcements will affect CNU?
Bobdn
22-02-2014, 05:29 PM
Any thoughts on how the latest telecom/spark announcements will affect CNU?
I have no idea in the short term. I hold both.
In the medium term, if ShowmeTV is able to make available high quality, HD content, I wonder if this will increase the uptake of UFB? The more people on UFB, the less the copper price matters. But I'm just indulging in some wishful thinking perhaps.
Harvey Specter
22-02-2014, 06:07 PM
I have no idea in the short term. I hold both.
In the medium term, if ShowmeTV is able to make available high quality, HD content, I wonder if this will increase the uptake of UFB? The more people on UFB, the less the copper price matters. But I'm just indulging in some wishful thinking perhaps.Yip - if it takes off, Fibre uptake should improve. With only $15m for content, dont expect any game changes though.
nextbigthing
24-02-2014, 07:18 AM
Potentially good news for CNU holders.
http://www.stuff.co.nz/national/politics/9755443/Labour-limping-Greens-in-freefall-poll
FYI: Chorus $78m half-year profit ($84m first-half last year; $80m analyst expectation), canceled dividend for the six months.
craic
24-02-2014, 09:25 AM
There is a patch of street on my way to my favourite watering hole and Chorus love to dig it up. I am sure this is the third dig since the fibre was installed.I don't know how much it costs per metre for the stuff but at this rate it will keep them broke forever - not to mention the fancy machines they use.
couta1
24-02-2014, 09:47 AM
"Here comes the pain again,
Falling on my head like a memory,
Falling on my head like a big copper cable..."
Aren't you glad you're out couta?
Hope Milford has cash on hand to start buying!
Sure are Moosie although could be good for a trade or two in the future maybe
Mista_Trix
24-02-2014, 09:47 AM
"Here comes the pain again,
Falling on my head like a memory,
Falling on my head like a big copper cable..."
Aren't you glad you're out couta?
Hope Milford has cash on hand to start buying!
Is any of this really unexpected though??
Mista_Trix
24-02-2014, 10:06 AM
Is any of this really unexpected though??
I'm gunna say given its open, its all been priced in.
BlackPeter
24-02-2014, 10:34 AM
just had a first browse through the half year results and listening to the webcast. Certainly don't see any negative surprises here:
UFB and RBI on track (good)
Earnings flat (on good old high levels)
No interims dividend (but who would have expected one anyway?)
Slight debt reduction, but leverage still too high for being comfortable (total liabilities to total assets 80.8%)
sort of excluded the nuclear option in he webcast (or not?) - at least it doesn't sound they want to rattle the cage on this
- from memory they said that they don't consider to reduce regulated broadband to "unusable levels"
- not sure though, whether this means they might consider reducing it to usable levels (my interpretation?)
Biggest risk in my view is the quite hefty leverage, but this is nothing new ... expect SP to slightly recover based on HY announcement
discl: holding;
winner69
24-02-2014, 10:50 AM
Always intrigued how companies say things
Chorus today - FY14 EBITDA: Chorus now expects to be at the top end of our FY14 guidance range of flat to low single digit percentage decline in EBITDA, relative to underlying FY13 EBITDA of $654 million.
Suppose in a round about way that says ebitda will be slightly down on FY13 but more likely to be closer to last years numbers rather than say 5% less ......unless top end means t bigger number and they will be say 5% down (also assuming that say. 5% is a low single digit percentage)
But what the heck somewhere near $654m is a big number anyway (and for some way too much for such a company to make)
Bjauck
24-02-2014, 11:01 AM
But what the heck somewhere near $654m is a big number anyway (and for some way too much for such a company to make)
Is it? The company today reported a net profit of $78 million on revenues of $535m for the six months to December. Is that an excessive return for shareholders? Is the ebit figure excessive when considering shareholders capital plus debt that Chorus has? How does it compare with other NZ companies and other international monopoly infrastructure companies?
winner69
24-02-2014, 01:29 PM
Is it? The company today reported a net profit of $78 million on revenues of $535m for the six months to December. Is that an excessive return for shareholders? Is the ebit figure excessive when considering shareholders capital plus debt that Chorus has? How does it compare with other NZ companies and other international monopoly infrastructure companies?
So 78m after tax profit for six months on shareholder equity of 624m at the start of the year is not enough
Annualised that is a 25% after tax return on shareholder equity.
The debt lenders get what they want as well so suppose they not complaining
How greedy can you get.....and this is only as you say an infrastructure company.
Bjauck
24-02-2014, 02:23 PM
So 78m after tax profit for six months on shareholder equity of 624m at the start of the year is not enough
Annualised that is a 25% after tax return on shareholder equity.
The debt lenders get what they want as well so suppose they not complaining
How greedy can you get.....and this is only as you say an infrastructure company.
When the current comcom decision comes into effect, Chorus may become a loss maker for who knows how many years. Investors before they go near this type of infrastructure company in nz will be demanding high returns, given the high political and regulatory risk.
Timid
24-02-2014, 03:50 PM
So 78m after tax profit for six months on shareholder equity of 624m at the start of the year is not enough
Annualised that is a 25% after tax return on shareholder equity.
The debt lenders get what they want as well so suppose they not complaining
How greedy can you get.....and this is only as you say an infrastructure company.
Actually this is the sort of statement I've been expecting from Labor and The Greens since the results were released. Of course it ignores the fact that the share price is artificially depressed at the moment due to uncertainty/negotiations/appeals/court case outcomes.
On listing it was worth twice as much, why not use that figure? If Chorus (somehow) actually won the court case I imagine it'd hit record highs.
Man, I *really* need an animated sig of Russel Norman jumping up and down, going red in the face, and shouting 'Super Profits!' It would be relevant on so many threads I've been reading the last few weeks.
winner69
24-02-2014, 03:59 PM
Actually this is the sort of statement I've been expecting from Labor and The Greens since the results were released. Of course it ignores the fact that the share price is artificially depressed at the moment due to uncertainty/negotiations/appeals/court case outcomes.
On listing it was worth twice as much, why not use that figure? If Chorus (somehow) actually won the court case I imagine it'd hit record highs.
Man, I *really* need an animated sig of Russel Norman jumping up and down, going red in the face, and shouting 'Super Profits!' It would be relevant on so many threads I've been reading the last few weeks.
Those numbers have nothing to do with the shareprice - nothing at all
Straight from Chorus accounts - no magic - nothing to do prevailing shareprice
Beginning of FY14 shareholder equity 624m and making an estimated 25% return on that equity (after tax ...........and paying the lenders heaps of interest)
Snow Leopard
24-02-2014, 05:04 PM
Where did you get the $477M from?
If you had written $177M I would not be worried.
Best Wishes
Paper Tiger
winner69
24-02-2014, 05:09 PM
Where did you get the $477M from?
If you had written $177M I would not be worried.
Best Wishes
Paper Tiger
I said Operating Profit being EBIT less an allowance for tax which divided by total capital invested gives the ROIC .....or simplified EVA for those into economic value added stuff (or the study of excessive economic returns)
Snow Leopard
24-02-2014, 06:00 PM
I said Operating Profit being EBIT less an allowance for tax which divided by total capital invested gives the ROIC .....or simplified EVA for those into economic value added stuff (or the study of excessive economic returns)
Sorry to pester but:
EBIT is around $170M for the half year or $340M for the year...
Best Wishes
Paper Tiger
winner69
24-02-2014, 06:19 PM
Sorry to pester but:
EBIT is around $170M for the half year or $340M for the year...
Best Wishes
Paper Tiger
Pester me as much as you want, especially when I have blundered really badly
You are correct as usual PT. I picked up the EBITDA number in error.
Does make the numbers a bit different in that Chorus is now only just covering it cost of capital.
I have deleted the original post. Will repost with correct numbers
Thanks for pointing out the error of my ways
Timid
24-02-2014, 06:29 PM
Fair enough, But I still don't think it can be called excessive when they're partially funding/building such a large infrastructure project. Can it really be compared to other similar companies that aren't in the same position?
That side of the business is even going along pretty well (at the moment) especially if you compare it to the NBN rollout in Australia.
The way things are going it could end up with everybody screwed. You have to wonder what sort of service existing copper customers are going to get with the bulk of the 400m in savings likely coming from that area.
http://www.nbr.co.nz/article/chorus-dials-back-copper-spending-drive-400-mln-savings-bd-152353
Also, is anyone able to get past the NBR paywall to see what Ratcliffe says about the Nuclear option?
http://www.nbr.co.nz/stayconnected?return=152325
Brain
24-02-2014, 09:57 PM
Timid -Ratcliff said "Chorus had absolutely no plans to throttle back broadband to an unusable specification"
Brain
Timid
24-02-2014, 10:03 PM
Thanks, thought it'd be something like that. Interesting choice of words, though.
Wonder what his definition of 'unusable' is?
BlackPeter
24-02-2014, 10:13 PM
Fair enough, But I still don't think it can be called excessive when they're partially funding/building such a large infrastructure project. Can it really be compared to other similar companies that aren't in the same position?
That side of the business is even going along pretty well (at the moment) especially if you compare it to the NBN rollout in Australia.
The way things are going it could end up with everybody screwed. You have to wonder what sort of service existing copper customers are going to get with the bulk of the 400m in savings likely coming from that area.
http://www.nbr.co.nz/article/chorus-dials-back-copper-spending-drive-400-mln-savings-bd-152353
Also, is anyone able to get past the NBR paywall to see what Ratcliffe says about the Nuclear option?
http://www.nbr.co.nz/stayconnected?return=152325
Hi Timid, you don't need NBR for that - just listen to the audio of the meeting: http://www.chorus.co.nz/file/42757/24-02-2014-180603.mp3
However - if you haven't got an hour to listen: He said that "there are absolutely no plans to throttle down broadband to an unusable specification" (citation from NBR and consistent with my memories). Whether this means the nuclear option is out, or just a bit less nuclear - I don't know and he didn't say.
Bjauck
25-02-2014, 08:13 AM
Whether this means the nuclear option is out, or just a bit less nuclear - I don't know and he didn't say.
Chorus have said they are going to treat the existing ComCom decision as though it is going to come into effect without any change, the review notwithstanding. which is the only thing they should do given the fluidity of the politics and regaulatory environment. As Chorus is currently facing a period of unprofitability, so as long as CNU stick to their existing copper contracts, they could defer maintenance over time down to a level of the contractually-obliged dial-up speeds. If any incoming Labour Government wants copper back up to the "broadband speeds" that Chorus was actually providing, they would need to renegotiate the contract(s) or nationalise Chorus with taxpayer money or expropriate shareholders' investments. That is how I see one scenario for Chorus.
BlackPeter
25-02-2014, 02:58 PM
just had a first browse through the half year results and listening to the webcast.
...
... expect SP to slightly recover based on HY announcement
discl: holding;
and I thought already I have to eat my words ... However nice rise in SP today - already up to $1.495 - $1.50 next?
BlackPeter
26-02-2014, 01:44 PM
Craigs Investment Analyst lifts 12 month target price to $1.80 and upgrades Chorus to "BUY":
http://www.nbr.co.nz/article/chorus-cost-clamp-down-gives-analyst-cheer-stock-upgraded-buy-bd-152446
Mista_Trix
26-02-2014, 02:50 PM
Any further work/thoughts on your adjusted numbers Winner??
Always interested in your opinion - in all its sarcastic (but knowledgeable) glory :-S
brentk
28-02-2014, 06:11 PM
Break of $1.50 would probably mean a run to $1.80.
Up she climbs.
nextbigthing
28-02-2014, 06:22 PM
Break of $1.50 would probably mean a run to $1.80. Nice short term spec play as she appears to have bottomed. Wouldn't put it past Milford to buy upwards...
Nice close today and good volume. Next week will be interesting.
Nice close today and good volume. Next week will be interesting.
Yes the near future will be interesting.
CNU has little to no chart pattern (not enough confirmed lines)..the indicators are bias to the positive but nothing much to write home about..so I guess many investors using TA as a entry tool may have their twitchy finger on the buy button sensing buy signals to break out
There are gaps which make up a points for Support & Resistance lines(S&R lines) which are useful..
There's been chartist observations that suggests Gaps (especially exhaustion gaps) create areas of vacuum which extend like S&R lines into the future..hypothesis has it that when price enters into a vacuum area it is quickly filled and sometimes with a gap back which surprises and frustrates the investor who was lying in wait waiting for a resistance break to jump in
Using this chartist observation, it wouldn't surprise me to see a near future 25c breakaway gap up appear around this current price area back up to 180.... the area Moosie mentioned.
Also..but less likely atm....... if the indicators suddenly sour and sell demand strengthens it could small gap down to retest the its bottom...a theoretical successful bottom test here would create a rectangle pattern with a 128 - 155 trading range)
Disc: hold some CNU.
http://i458.photobucket.com/albums/qq306/Hoop_1/CNU28022014.png (http://s458.photobucket.com/user/Hoop_1/media/CNU28022014.png.html)
nextbigthing
03-03-2014, 08:47 AM
Cheers Hoop.
There will have to be a point somewhere in the future, where all the institutions that wanted out have done just that and the heavy supply of shares ceases. This coupled with very strong polling by National at the moment (enough to govern alone) and the realization that CNU are likely through the worst of it (worst case has happened, likely change of increased pricing from the review) means IMHO that there's good potential for the share price to move in the right direction!
Disc hold
nextbigthing
03-03-2014, 08:48 AM
Ps I wonder if that's what Milford have been looking at and that's why they're buying?
nextbigthing
06-03-2014, 09:41 PM
Nice try Vodaphone....
http://www.stuff.co.nz/technology/digital-living/30020945/govt-rejects-vodafone-ufb-plea
Casino
06-03-2014, 11:16 PM
Nice try Vodaphone....
http://www.stuff.co.nz/technology/digital-living/30020945/govt-rejects-vodafone-ufb-plea
They're just looking out for you.
Harvey Specter
07-03-2014, 08:12 AM
They're just looking out for you.in the very short term, it would be win:win. After that, it is a big lose for everyone but Vodafone.
Question: why don't they wholesale their cable product now. If they did that, it would then become a commercial decision for CNU, not a protected monopoly for VNZ
couta1
07-03-2014, 08:39 AM
Anyone buying these days? Charts looking much healthier
Funny you should ask Moosie,l was just considering taking up a holding again yesterday,that would be a bold step for me
Bjauck
07-03-2014, 08:45 AM
As CNU lies prostrate on the ground with all those knives (many foreign-owned) in its back, vodafone removes its one, one of the sharpest, and tries to have another stab.
Billy Boy
07-03-2014, 12:08 PM
Funny you should ask Moosie,l was just considering taking up a holding again yesterday,that would be a bold step for me
I got back in, small but..... Back in
BB
couta1
07-03-2014, 06:46 PM
I got back in, small but..... Back in
BB
I'm a bit concerned about the effect of that 300 mill capital raising will have on share price ie dilution effect,that's holding me back from taking the plunge again
Mista_Trix
07-03-2014, 06:51 PM
I'm a bit concerned about the effect of that 300 mill capital raising will have on share price ie dilution effect,that's holding me back from taking the plunge again
'Suspected', its still only one (or a couple of's) institutions opinion.
Still might be totally void if there's any backtracking in November.
nextbigthing
07-03-2014, 07:05 PM
From John Key today;
'In the next few weeks, New Zealanders will have the opportunity to invest in a minority stake in Genesis Energy.........
It means we are investing in new assets - like schools, hospitals, roads, and broadband - without going further into debt'
Don't worry Couta, they're selling Genesis to cover it :D
Billy Boy
08-03-2014, 12:18 PM
I'm a bit concerned about the effect of that 300 mill capital raising will have on share price ie dilution effect,that's holding me back from taking the plunge again
.
With you on that one. It's why my Buy In was small. Other side :-
They need the money to work with. Spent wisely, cud have an upside.
Insto,s showing a little more interest, why ???
Getting into Hmmm ground now.
BB
Bobdn
08-03-2014, 08:59 PM
Am I right in thinking that there are just three big things on the horizon that I should be watching out for?
1. outcome of the negotiations with CFH
2. Court case late March with a decision sometime in April
3. outcome of pricing review - possibly by 1 December.
Anything major that I've missed?
nextbigthing
09-03-2014, 08:06 AM
Am I right in thinking that there are just three big things on the horizon that I should be watching out for?
1. outcome of the negotiations with CFH
2. Court case late March with a decision sometime in April
3. outcome of pricing review - possibly by 1 December.
Anything major that I've missed?
Election outcome.
Mista_Trix
11-03-2014, 09:39 AM
'Chorus and CFH agree package of UFB improvements';
https://www.nzx.com/companies/CNU/announcements/248043
couta1
11-03-2014, 11:06 AM
'Chorus and CFH agree package of UFB improvements';
https://www.nzx.com/companies/CNU/announcements/248043
News hasn't done anything for the share price,looks like its going to take outcome of court case and FPP ruling to kick things into gear,I would have thought the news of the early election would have also been positive for Chorus with National pretty comfortably in the lead,still observing from outside
couta1
11-03-2014, 08:44 PM
Price increased toward end of day,looking a bit more solid now,do we have the start of an uptrend? Looks to be staying above the MA30 line now.Anyone else looking to re enter or take up a position? Would need to look at it as a growth stock with no dividend for the foreseeable future I guess
Hi Couta
No medium term uptrend (higher high, higher low) yet.
Since the 1st march chart I posted (http://www.sharetrader.co.nz/showthread.php?8673-CNU-Chorus/page141) the indicators are all positive now the MA50 has a bullish cross over..the Chorus shareprice is the only divergence...but it is once again testing its 1.58 (1.59) resistance line ....With the indicators being positive chances are the shareprice should break through this resistance this time and into the Gap zone...Price behaviour within the gap zone can be one of sudden changes ...its possible that the price could move very quickly through the gap zone (a vacuum area) .. gap behaviour activities increase within this zone.
EDIT:
All rules are designed to be broken...There are times when you should ignore the rule of thumb "buy near support sell near resistance"....CNU price is close to a resistance but the TA indicators have turned positive so you should hold and wait...also.. above that resistance is gap territory which is another reason to hold ..selling would be wrong (risk v reward).. if a sudden gap up appeared at the resistance break, buying back would all of a sudden be much more expensive........
Casino
12-03-2014, 12:26 PM
Hi Couta
No medium term uptrend (higher high, higher low) yet.
Since the 1st march chart I posted (http://www.sharetrader.co.nz/showthread.php?8673-CNU-Chorus/page141) the indicators are all positive now the MA50 has a bullish cross over..the Chorus shareprice is the only divergence...but it is once again testing its 1.58 (1.59) resistance line ....With the indicators being positive chances are the shareprice should break through this resistance this time and into the Gap zone...Price behaviour within the gap zone can be one of sudden changes ...its possible that the price could move very quickly through the gap zone (a vacuum area) .. gap behaviour activities increase within this zone.
EDIT:
All rules are designed to be broken...There are times when you should ignore the rule of thumb "buy near support sell near resistance"....CNU price is close to a resistance but the TA indicators have turned positive so you should hold and wait...also.. above that resistance is gap territory which is another reason to hold ..selling would be wrong (risk v reward).. if a sudden gap up appeared at the resistance break, buying back would all of a sudden be much more expensive........
I'm not saying that you're wrong. But could it be that you've subconsciously performed a FA and projected it on your TA?
couta1
12-03-2014, 12:37 PM
Time to buy small parcel,has hit $1.60
I'm not saying that you're wrong. But could it be that you've subconsciously performed a FA and projected it on your TA?
Nope...I was observing rising indicator lines and gaps on my chart ..that's a visual TA effect not a subconscious FA effect....hang on I'll check to make sure what I'm drinking...yep it's Coffee...:D
It is very possible these TA indicators are showing subconscious FA performing trading behaviour ...
Hmmmm the price is moving...some large buys off market at 160 the resistance has be cracked..lets see if it stays that way at closing (EOD data) and help confirm the breakout...
Billy Boy
12-03-2014, 02:19 PM
N
Hmmmm the price is moving...some large buys off market at 160 the resistance has be cracked..lets see if it stays that way at closing (EOD data) and help confirm the breakout...
.
Yep.... Insto's getting more and more involved.
Price could well be getting a push from Traders,
if so then we could well see a SP drop come Friday afternoon and close
BB
Bobdn
12-03-2014, 05:05 PM
Gee, I've still (paper) lost a bundle on Chorus, but less so after today :)
nextbigthing
12-03-2014, 07:07 PM
Nice strong close. You in now Hoop?
Snow Leopard
12-03-2014, 08:22 PM
SO Chorus will get dumped from the NZX15 Index; for what that is worth.
https://nzx.com/regulators/NZXO/announcements/248110
Best Wishes
Paper Tiger
Nice strong close. You in now Hoop?
Yep... got in just over a week ago when divergences started to be noticeable....but....it was a dabble as I'm cash strapped...I would've accumulate more yesterday but I couldn't as I'm 100% in / cash 0% (a rare event for me)and wasn't willing to sell anything to free up some trading cash...a bugger they say...eh?
nextbigthing
12-03-2014, 10:12 PM
Yep... got in just over a week ago when divergences started to be noticeable....but....it was a dabble as I'm cash strapped...I would've accumulate more yesterday but I couldn't as I'm 100% in / cash 0% (a rare event for me)and wasn't willing to sell anything to free up some trading cash...a bugger they say...eh?
Not a bad thing to have so many opportunities Hoop.
Snow Leopard
12-03-2014, 10:48 PM
Four months ago I said Chorus was worth $1.61 a pop (http://www.sharetrader.co.nz/showthread.php?8673-CNU-Chorus&p=440770&viewfull=1#post440770) and for most of the intervening time the SP has actually been below this figure. (This is surprising as my valuations are usually from a little to a lot lower than the majority).
Anyway today Chorus has climbed above that figure and although I consider that if I did do another guesstimate it may come in a few cents higher I am not going to bother and will stick with $1.61.
So no more buying on fundamentals but the technicals are showing a little promise.
Best Wishes
Paper Tiger
BlackPeter
13-03-2014, 07:57 AM
Four months ago I said Chorus was worth $1.61 a pop (http://www.sharetrader.co.nz/showthread.php?8673-CNU-Chorus&p=440770&viewfull=1#post440770) and for most of the intervening time the SP has actually been below this figure. (This is surprising as my valuations are usually from a little to a lot lower than the majority).
Anyway today Chorus has climbed above that figure and although I consider that if I did do another guesstimate it may come in a few cents higher I am not going to bother and will stick with $1.61.
So no more buying on fundamentals but the technicals are showing a little promise.
Best Wishes
Paper Tiger
Difficult one ... ft.com puts the annual target on between $1.50 and $2.85 - with a median of $1.90.
The wide span is likely to be caused by political uncertainties. If NZ has after the polls a National government able to do what they please, than 2.85 might be a fair reflection of its economical value. If NZ has after the polls a Labour / Green government eager to screw big business, than $1.50 still might be optimistic (on the other hand, they would be unlikely to get more than one term, i.e. might be worthwhile to do a NPV analysis).
If (most likely case) we have a National led government which needs to please a number of small parties (liberitarian and / or populistic), than all bets are off. I couldn't pick with any degree of certainty a fair value based on these assumptions, but am currently holding (i.e. expect CNU to keep going up or at least to hold their value).
nextbigthing
13-03-2014, 08:04 AM
Hey Paper Tiger,
Would you mind sharing your model/workings to get to that valuation for the benefit of all?
Cheers, NBT
Mista_Trix
13-03-2014, 09:01 AM
Difficult one ... ft.com puts the annual target on between $1.50 and $2.85 - with a median of $1.90.
The wide span is likely to be caused by political uncertainties. If NZ has after the polls a National government able to do what they please, than 2.85 might be a fair reflection of its economical value. If NZ has after the polls a Labour / Green government eager to screw big business, than $1.50 still might be optimistic (on the other hand, they would be unlikely to get more than one term, i.e. might be worthwhile to do a NPV analysis).
If (most likely case) we have a National led government which needs to please a number of small parties (liberitarian and / or populistic), than all bets are off. I couldn't pick with any degree of certainty a fair value based on these assumptions, but am currently holding (i.e. expect CNU to keep going up or at least to hold their value).
I'm a lefty and I don't know anyone who trusts Cunliffe, I don't think the left has a chance this election. :-S
couta1
13-03-2014, 11:07 AM
You know the old saying NB You can please some of the people some of the time but not all of the people all of the time,now doesn't this ring true for this forum plus chuck in the dishonest and those with hidden agendas and you have quite a mix:cool:
Bobdn
13-03-2014, 03:29 PM
Anyway, I went for three months (December, January, and February ) without once looking at the CNU share price. Avoided all newspapers and NZ news which is not that difficult because I get most of my news on the net. I also avoided this forum. If I had seen the share price when it went down to $1.29 in December, it would have ruined my Christmas break.
Sometimes it just pays to check out of the madness and concentrate on other things.
Mista_Trix
14-03-2014, 10:34 AM
Not sure if anyone's posted this price target on here yet;
"Macquarie maintained its 12-month target price on the stock of $2.20 but also said Chorus had a high risk and was "not for the faint-hearted".
From the article;
http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11219188
Billy Boy
14-03-2014, 11:14 AM
Not sure if anyone's posted this price target on here yet;
"Macquarie maintained its 12-month target price on the stock of $2.20 but also said Chorus had a high risk and was "not for the faint-hearted".
From the article;
http://www.nzherald.co.nz/opinion/news/article.cfm?c_id=466&objectid=11219188
Wrong link I think old son
BB
JAYAY
14-03-2014, 11:21 AM
Wrong link I think old son
BB
Is it from the paywalled story in NBR titled "As Chorus gets it's day in court, $5B Aussie fund Manager explains why he is hanging on"
Mista_Trix
14-03-2014, 11:28 AM
Wrong link I think old son
BB
Take a read further down the page - there's several stocks discussed in the 'stock takes', PEB is the first, CNU is the second :)
Billy Boy
15-03-2014, 09:34 AM
.
Yep.... Insto's getting more and more involved.
Price could well be getting a push from Traders,
if so then we could well see a SP drop come Friday afternoon and close
BB
No SP drop. !!
Traders not getting too involved at this stage it would appear.
Medium - Long term buyers getting in I would suggest. :)
BB
Mista_Trix
17-03-2014, 03:32 PM
'ComCom erred in copper pricing - Chorus lawyer'
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11221290
Joshuatree
17-03-2014, 06:28 PM
Thanx for that Mista Trix, heres hoping.
Snow Leopard
17-03-2014, 07:38 PM
Hey Paper Tiger,
Would you mind sharing your model/workings to get to that valuation for the benefit of all?
Cheers, NBT
Having bandied a value of $1.61 for Chorus round this thread I have been called upon to front up, which I hereby do.
This was a quick and dirty evaluation, which means it is sufficiently easy to explain.
Mid November when the calculation was done the prior full year results (30-Jun-13) recorded a profit of $171M and the management had recently announced that with the ComCom decision they were likely to loose $160M in EBITDA once implemented.
So the revised profit would be $55M8 (171-(160*0.72)) or $0.143 per share if the regime was already in place.
A quick look at the accounts and the cash flows and it says to me that they will not go bust and can continue building the new and maintaining the old but they best not pay a dividend.
I then obviously decided that I would assume 5% pa growth in revenue and multiplying profits by 11 (generous for a non-divvy payer) would do. [I am assuming linear growth so a simple multiplier is OK otherwise I need to do the discounting trick]
OK so that gave/gives the following values for CNU.
Date
Value
30-Jun-13
$1.577
30-Nov-13
$1.610
31-Mar-14
$1.636
30-Jun-14
$1.656
Comments:
It was quick and dirty.
I am naturally cautious in valuing any company.
Using a multiplier of 11 means I expect some upside, normally the number would be about 10.
The is little history to the Chorus accounts to determine a normal, another reason to keep it very simple.
I am not going to a more detailed/elaborate valuation for CNU anytime soon, I do not know enough to make anything more accurate.
If your valuation is different then that is fine - it just means they are different, not wrong.
The Geckos actually just steals the elastic bands that hold the Nasi Bunkus and similar together. I can only guess what they do with them!
Best Wishes
Paper Tiger
Bobdn
17-03-2014, 08:01 PM
Thanx for that Mista Trix, heres hoping.
I just don't know. What if Chorus wins - doesn't that just mean the ComCom is required to go through that particular process again taking into account the relevant factors that it may have overlooked the first time? (with no guarantee what the outcome is) Will this then delay the final pricing review which for me is much more important?
JAYAY
18-03-2014, 09:11 AM
I just don't know. What if Chorus wins - doesn't that just mean the ComCom is required to go through that particular process again taking into account the relevant factors that it may have overlooked the first time? (with no guarantee what the outcome is) Will this then delay the final pricing review which for me is much more important?
I wonder if Chorus win would mean status quo until FPP review completed.
I see that Vodafone, Orcon and Telecom get to have their say in this current court case.
How is this? I thought it was a case brought by Chorus against ComCom. Why on earth do they get to put their spoke in.
JAYAY
18-03-2014, 04:51 PM
Sweeping changes to laws governing the telecommunications sector were to blame for size of the drop in what Chorus can charge for access to its copper lines services, rather than the Commerce Commission's decision to impose the cut, the High Court heard today
"It was the change in regulation that caused the shock, not the Commerce Commission decision made under that new regulation," Farmer told the High Court in Wellington.
Sounds like an admission that ComCom's decision was a perverse one.
nextbigthing
18-03-2014, 10:50 PM
Having bandied a value of $1.61 for Chorus round this thread I have been called upon to front up, which I hereby do.
........
Best Wishes
Paper Tiger
Thank you PT for taking the time to do this. Appreciated.
Mista_Trix
19-03-2014, 10:59 AM
The next article in the saga;
http://www.stuff.co.nz/business/industries/9843908/Watchdog-If-broadband-cap-fits-wear-it
The next article in the saga;
http://www.stuff.co.nz/business/industries/9843908/Watchdog-If-broadband-cap-fits-wear-it
I like the judge's suggestion that the copper price remain at the same level that it is now until the FPP is completed (however long that takes). I'm guessing that the judge also likes this option:) and it's his call at the end of the day.
This could all end well for Chorus - copper price stays up and additional bonus of having renegotiated more favourable terms with CFH
couta1
19-03-2014, 12:07 PM
I like theige's suggestion that the copper price remain at the same level that it is now until the FPP is completed (however long that takes). I'm guessing that the judge also likes this option:) and it's his call at the end of the day.
This could all end well for Chorus - copper price stays up and additional bonus of having renegotiated more favourable terms with CFH
Correct me if im wrong but isnt the FPP review due at years end so the price remaining the same is of no consequence as the new price doesnt kick in till then anyway?
Harvey Specter
19-03-2014, 12:14 PM
Correct me if im wrong but isnt the FPP review due at years end so the price remaining the same is of no consequence as the new price doesnt kick in till then anyway?But that is a shorted timetable so will they deliver on time? and I am sure CNU will appeal it! But in theory, that is why it is an appealing option for the Judge.
Soviet
20-03-2014, 05:35 PM
I hear today that Chorus is laying off quite a few staff. About 180 jobs to go which maybe will have a positive/negative effect on the current SP or better outlook for the FY 15/16.
JAYAY
28-03-2014, 12:29 PM
https://www.nzx.com/files/attachments/191741.pdf
Well there you are, they can do it when they want to.
So what was all the talk about FPP taking years to complete?
couta1
28-03-2014, 12:33 PM
https://www.nzx.com/files/attachments/191741.pdf
Well there you are, they can do it when they want to.
So what was all the talk about FPP taking years to complete?
I wonder what the result will be,could go either way?
JAYAY
28-03-2014, 01:01 PM
I wonder what the result will be,could go either way?
Yes, the worry is that ComCom will be biased and looking to vindicate themselves for a dubious decision in the first place.
JAYAY
28-03-2014, 01:27 PM
Does this latest news kind of pre-empt the High Court decision and render the High Court decision of academic interest only?
Am I interpreting all of this correctly?
nextbigthing
28-03-2014, 04:06 PM
Haven't had a chance to analyse it all yet but the market seems to like what's going on...
couta1
28-03-2014, 07:11 PM
Yes, the worry is that ComCom will be biased and looking to vindicate themselves for a dubious decision in the first place.
Yeah bit of a dilemma from my viewpoint after my scolding,I want to re enter the stock but I think I will probably have some money lined up ready for the ComCom decision,sure I might miss out on 20 c or so worth of gain but if the decision goes in CNUs favor that won't matter as the share will be on its way back toward $3 and the dividend reinstated,but if they come back reinforcing the price cuts the share price may take another hit if it climbs back toward $2 in the meantime,then we go back to the future once again
nextbigthing
02-04-2014, 03:15 PM
Appears to be in a reasonably steady uptrend. Mr Market is obviously bullish about the outcome (or positive details are leaking!).
5651
Disc; Hold.
Mista_Trix
02-04-2014, 03:23 PM
Appears to be in a reasonably steady uptrend. Mr Market is obviously bullish about the outcome (or positive details are leaking!).
Disc; Hold.
Or, as the election outcome looks to lean further and further right ...?
nextbigthing
05-04-2014, 02:56 PM
http://www.stuff.co.nz/business/industries/9904741/A-Brokers-View-Chorus
Casino
05-04-2014, 05:44 PM
http://www.stuff.co.nz/business/industries/9904741/A-Brokers-View-Chorus
I agree with every nuance of this article. Thanks for sharing.
Mista_Trix
07-04-2014, 03:56 PM
http://www.stuff.co.nz/business/industries/9904741/A-Brokers-View-Chorus
A rebuke to (parts of) the article above;
http://www.stuff.co.nz/business/opinion-analysis/9913386/Taking-issue-with-Chorus-analysis
Harvey Specter
07-04-2014, 04:09 PM
A rebuke to (parts of) the article above;
http://www.stuff.co.nz/business/opinion-analysis/9913386/Taking-issue-with-Chorus-analysis
That should have a disclosure notice on the bottom. He is the head of TUANZ (or has he just left?) which is a lobby group.
JAYAY
07-04-2014, 04:57 PM
A rebuke to (parts of) the article above;
http://www.stuff.co.nz/business/opinion-analysis/9913386/Taking-issue-with-Chorus-analysis
The original article uses the words "... essentially a retraction...." which of course the comcom action is.
I think Paul Brislen needs to pull his head in.
nextbigthing
07-04-2014, 07:26 PM
That should have a disclosure notice on the bottom. He is the head of TUANZ (or has he just left?) which is a lobby group.
http://tuanz.org.nz/tuanz-ceo/
Paul stepped into the role of chief executive of the Telecommunications Users’ Association of NZ in early 2011. Since then he’s battled mobile termination rates, the threat of a 10-year regulatory holiday under UFB, international mobile roaming rates and copyright legislation whilst keeping a watching brief on the UFB and RBI rollout, spectrum auctions, content debates and the ultimate aim – a faster, smarter, more connected New Zealand. A journalist by trade, past roles include head of corporate communications at Vodafone NZ as well as the editorial spot at ComputerworldNZ.
nextbigthing
07-04-2014, 07:42 PM
From http://www.stuff.co.nz/business/opinion-analysis/9913386/Taking-issue-with-Chorus-analysis
There has been no retraction, no backing down, no change to the commission's approach, no deviation from the law in this regard. To suggest otherwise is simply incorrect - we are working through a process as laid down in the law.
The commission cannot deviate from the Act with all of this. It has to follow the prescribed path laid out by Steven Joyce back in 2010.
The only area for debate is around Section 18 of the act which says "consideration must be given to the incentives to innovate that exist for, and the risks faced by, investors in new telecommunications services" and it's on this one line that the broking community has seemingly pinned all its hopes.
This section has never been tested before and is currently before the High Court, but quite how one line in an entire Act is supposed to override the other carefully worded provisions is beyond me....
......So Let me get this straight, in one sentence you're saying we must follow the exact law very specifically laid down by Steven Joyce because he wrote it exactly as intended, then in the next sentence you're saying we should ignore one overriding part of the act because it's too powerful and you don't like it. Hmm, I'm not a law expert in understanding Acts but I don't think it works like that buddy....
JAYAY
08-04-2014, 07:42 AM
If the Commissioner had any gumption he would have gone back to Steven Joyce and said this process ain't gunna work. The only country we can bench mark against is Sweden and that's ridiculous. Let's go straight to the FPP review. I am sure Steven Joyce would have agreed.
FPP it seems will be delivered by the magic date 30-11-14 and will be the final word rendering the initial pricing process ineffective. ie "essentially a retraction".
(PS Surely there must have been countries more appropriate to bench mark against. Why not Australia?)
couta1
08-04-2014, 07:59 AM
I kinda get the feeling the final outcome may have another sting in the tail for investors,like the old saying just when you thought it was safe to go back into the kitchen. Disc-Not back in yet but want to be
nextbigthing
08-04-2014, 08:09 AM
I kinda get the feeling the final outcome may have another sting in the tail for investors,like the old saying just when you thought it was safe to go back into the kitchen. Disc-Not back in yet but want to be
What makes you say that Couta? Or is it just a feeling?
nextbigthing
08-04-2014, 08:12 AM
(PS Surely there must have been countries more appropriate to bench mark against. Why not Australia?)
I think they have to be geographically similar. Ie Australia too flat and much bigger distances.
JAYAY
08-04-2014, 09:05 AM
High Court leaves status quo in place8:57am, 8 Apr 2014 | GENERALSTOCK EXCHANGE ANNOUNCEMENT
8 April 2014
High Court leaves status quo in place
Chorus notes today’s High Court judgment dismissing its appeal from the Commerce Commission’s (Commission) determination of the regulated price of Chorus’ Unbundled Bitstream Access (UBA) service using a benchmarking methodology, a decision scheduled to come into effect on 1 December 2014.
“We will be reviewing the Court’s findings in detail. It was important that a regulatory decision of such significance for investment in communications infrastructure enabling better broadband for New Zealand was reviewed by the Court. The appeal permitted in the regulatory framework was on a question of law only rather than a review on the merits as is permitted in other industries. We have always acknowledged that the Commission had significant challenges in applying the law as it stands and we remain of the view that benchmarking is an outdated methodology,” said Vanessa Oakley, General Counsel.
“Today’s decision simply leaves the status quo in place. Our focus continues on the parallel Commission processes that use cost modelling for the first time to review the benchmarked prices of regulated services. The Commission has recently said it is aiming to complete the price reviews contemporaneously by 1 December 2014.”
“If the Commission meets that timetable the cost modelled price for UBA and a new cost modelled price for the unbundled copper local loop (UCLL) service will apply from 1 December.”
ENDS
For further information:
Ian Bonnar
Corporate Affairs Manager
Mobile: +64 (27) 215 7564
Email: ian.bonnar@chorus.co.nz
Brett Jackson
Investor Relations Manager
Mobile: +64 (27) 488 7808
Email: brett.jackson@chorus.co.nz
There you go. As expected.
Note that Chorus remains of the view that benchmarking is an outdated methodology.
I think the Commissioner himself stated the same thing at an earlier stage which makes it even more bizarre that he pursued it.
Bjauck
08-04-2014, 09:15 AM
I think they have to be geographically similar. Ie Australia too flat and much bigger distances.
VIC would have been similar...with dwelling composition similar to NZ...as opposed to blocks of appartments in Scandinavia.
couta1
08-04-2014, 09:20 AM
What makes you say that Couta? Or is it just a feeling?
Just a gut feeling plus the ComCom isnt going to roll over easily on this one especially now since the court has just left the status quo in place,will probably wait until the day of the final price determination to jump back in to be safe,after all if its a favorable decision expect a spike plus the dividend stream to start flowing again
Mista_Trix
08-04-2014, 11:25 AM
There's a locked article on NBR, does anyone have an account who can give a summary?
High court verdict legal blow Chorus - but also major political blow
Aught3
08-04-2014, 12:14 PM
There's a locked article on NBR, does anyone have an account who can give a summary?
High court verdict legal blow Chorus - but also major political blow
Discusses the comment by John Key last year that suggested National would look at using legislation to overrule the ComCom as the regulator had been too narrow in its interpretation of the law with Chorus. The election in September might have given them a chance to try again with more accommodating coalition partners, but - with the High Court ruling appearing to "back up" the ComCom decision - National may find it politically more difficult to overrule them both.
Also a couple of sentences rehashing the FPP review and CFH negotiations.
(Long time lurker, first time poster)
Mista_Trix
16-04-2014, 09:30 AM
Roll-out ahead of schedule;
https://www.nzx.com/companies/CNU/announcements/249538
couta1
16-04-2014, 09:35 AM
Roll-out ahead of schedule;
https://www.nzx.com/companies/CNU/announcements/249538
Maybe they should slow down,they haven't been given any incentives to be ahead of schedule:cool:
nextbigthing
16-04-2014, 10:46 AM
Maybe they should slow down,they haven't been given any incentives to be ahead of schedule:cool:
I disagree Couta.
As it stands they can charge more for fibre. The faster they can roll it out and start trying to get people across the better.
Harvey Specter
16-04-2014, 10:59 AM
I disagree Couta.
As it stands they can charge more for fibre. The faster they can roll it out and start trying to get people across the better.Agree - get the fibre rolled out, get people switched over, then the copper price is less relevant.
Hard to complain about cooper price stopping people from switching if they dont have the option. Or alternatively, make the Nuclear option more palatable.
biker
24-04-2014, 09:58 AM
as at 09:11:12, Thursday 24 April, 2014 (NZT)
GENERAL: CNU: Final decision on benchmarked UCLFS connection charges
CNU
24/04/2014 09:11
GENERAL
REL: 0911 HRS Chorus Limited (NS)
GENERAL: CNU: Final decision on benchmarked UCLFS connection charges
STOCK EXCHANGE ANNOUNCEMENT
24 April 2014
Final decision on benchmarked UCLFS connection charges
The Commerce Commission (Commission) has determined that unbundled copper low
frequency service (UCLFS) charges should be re-set so that they are the same
as benchmarked unbundled copper local loop (UCLL) that were set in a
determination made on 3 December 2012. This means that the UCLFS connection
charges will change to align to the benchmarked UCLL connection charges.
Chorus estimates that this decision would have an annualised EBITDA impact of
around $6 million. The Commission also requires that the new UCLFS
connection charges be backdated to 3 December 2012, including interest. The
net effect of backdating and interest charges is estimated to reduce Chorus'
FY14 EBITDA by an indicative $9-$10 million.
Chorus' FY14 EBITDA guidance range is unchanged but the consequence of
today's decision is that Chorus now expects to track to the middle of the
range of flat to low single digit percentage decline in EBITDA, relative to
underlying FY13 EBITDA of $654 million.
RSPs currently pay UCLFS connection charges to connect end users to Chorus'
UCLFS, in addition to ongoing monthly rentals for accessing these services.
Chorus' view is that connection charges for UCLL are part of the UCLL final
pricing principle (FPP) process that is due to be completed by 1 December
2014. Those processes use a cost modelling rather than a benchmarking
approach. Chorus proposed that the Commission consider the review of the
UCLFS connection charges with the benefit of cost modelling analysis. In a
situation where the final pricing reviews change benchmarked connection
charges again, consideration of backdating remains relevant - today's
outcomes have the potential to be reversed.
The effect of the Commission's decision is that any changes to the
benchmarked UCLL prices as a consequence of the UCLL FPP process will
automatically flow through to the UCLFS prices.
couta1
24-04-2014, 11:00 AM
The punters may need till after lunch before they realize that the latest news is not actually good news
I don't think it's hugely unexpected news
Crisis
24-04-2014, 11:37 AM
$10m EBITDA impact back dated to Dec 2012 seems to realistic for many but Chorus may not have realised or purposefully silent about this until now. CC have always won from the tug of war with CNU. It is expected that in FPP, CC will also win and all sorts of pricing will be further reduced. CC deals everything more professionally and logically than Chorus.
nextbigthing
24-04-2014, 12:12 PM
It is expected that in FPP, CC will also win and all sorts of pricing will be further reduced...
That's a big claim Crisis. Expected by who? Care to provide some proof to back this rather large claim up?
Bjauck
24-04-2014, 03:00 PM
$10m EBITDA impact back dated to Dec 2012 seems to realistic for many but Chorus may not have realised or purposefully silent about this until now. CC have always won from the tug of war with CNU. It is expected that in FPP, CC will also win and all sorts of pricing will be further reduced. CC deals everything more professionally and logically than Chorus.
What should Chorus do? It seems that the benchmarking used by ComCom was to countries where conditions were different from NZ. Cost analysis is needed. If FPP indeed results in no change to ComCom pricing, then Chorus, logically on behalf of its shareholders who have provided their money, will need to consider the "nuclear option" of sticking to the letter of their contract and allowing the connection speeds to degrade to the contracted minimum. By the way, it would be logical to do this anyway, ComCom decision or not. If faster than contracted speed is wanted, extra payment should be made, logically.
The whole environment in which Chorus is operating is a political/regulatory contradictory mess, in my opinion.
couta1
05-05-2014, 02:49 PM
Well Ive finally mounted this mare again 25k shares at $1.70,will probably just do a lap or two before climbing off as I fear this mare may have a bit of bucking left in her come December if she doesn't get the food she wants but anyway took a bit of courage to remount:cool:
Mista_Trix
05-05-2014, 02:59 PM
Well Ive finally mounted this mare again 25k shares at $1.70,will probably just do a lap or two before climbing off as I fear this mare may have a bit of bucking left in her come December if she doesn't get the food she wants but anyway took a bit of courage to remount:cool:
Remember how 'we were all crazy' for getting back in at $1.40... Doesn't look so crazy now does it.
So why in now? Given that PSAR, MACD and RSI are all tracking down and its just moved through a support level? Or you don't care?
Just curious.
couta1
05-05-2014, 03:09 PM
Remember how 'we were all crazy' for getting back in at $1.40... Doesn't look so crazy now does it.
So why in now? Given that PSAR, MACD and RSI are all tracking down and its just moved through a support level? Or you don't care?
Just curious.. I can't remember saying you were crazy just I was not in a position to contemplate getting back in at that point but well put that behind us aye, its at a 4 week low and looks good for a trade to me if not a longer hold,its also like putting the past behind and moving on which I think you'll agree is positive, I don't think anyone can be supremely confident in where this whole thing is going just yet,cheers
Mista_Trix
06-05-2014, 09:47 AM
While not Chorus specific, about the landscape in which it sits;
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11249807
couta1
06-05-2014, 10:37 AM
While not Chorus specific, about the landscape in which it sits;
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11249807
Let's hope the gist of this article is right will be in CNUs favour
Mista_Trix
08-05-2014, 03:04 PM
Wonder if the Labour-Greens recent polling numbers will have (or is already contributing to) a negative pull on the SP.
The great fiber rollout saga.
I just talked with a tech installing the fibers in a street near me. They are using a manual crimp method to join the fibers..!! the losses for each circuit would be through the roof..!!. Where is the quality, what happened to the infra red laser joining and MUCH better transmission quality.
Cut costs/cut quality/cut bandwidth/ public pays for inferior service...
jamiec26
08-05-2014, 04:45 PM
Have alook at MRP, GNE AND MELCA for the answer to that question... 4 words. Judith. Collins. Maurice. Williamson
Bobdn
08-05-2014, 08:54 PM
The great fiber rollout saga.
I just talked with a tech installing the fibers in a street near me. They are using a manual crimp method to join the fibers..!! the losses for each circuit would be through the roof..!!. Where is the quality, what happened to the infra red laser joining and MUCH better transmission quality.
Cut costs/cut quality/cut bandwidth/ public pays for inferior service...
I don't know anything about connecting fibre optic cables and whether there's a degradation in signal with the method you describe. However the "saga" as you call it does seem to be going well with 420,000 people now having access to ultra fast broadband. The roll out is an incredible success, just not for the investors who stumped up to help fund three quarters of it, like me.
Oh well, at least The Warehouse is moving some serious product.
PartyPooper
08-05-2014, 10:59 PM
The great fiber rollout saga.
I just talked with a tech installing the fibers in a street near me. They are using a manual crimp method to join the fibers..!! the losses for each circuit would be through the roof..!!. Where is the quality, what happened to the infra red laser joining and MUCH better transmission quality.
Cut costs/cut quality/cut bandwidth/ public pays for inferior service...
As far as i'm aware my mates working on the UBF project have been manual crimping since the project begun was the first thing they learnt how to do while starting on the job. Chorus are building a decent network not a Google Fibre style network.
BlackPeter
09-05-2014, 09:35 AM
The great fiber rollout saga.
I just talked with a tech installing the fibers in a street near me. They are using a manual crimp method to join the fibers..!! the losses for each circuit would be through the roof..!!. Where is the quality, what happened to the infra red laser joining and MUCH better transmission quality.
Cut costs/cut quality/cut bandwidth/ public pays for inferior service...
Manual crimping - so what?
Even if a bad crimp inflicts higher losses (a good crimp wouldn't), why would this be a problem for the end user? As long as the received signal is above the noise floor, there is absolutely no difference in transmission speed and quality.
Crimping introduces loss, which reduces useable length/distance and bandwidth (total frequency range achievable).
But whos concerned eh ... its just the public.
I do agree in principle with a fiber rollout, I just find the drop in standards since I was in the industry to be disapointing.. ok we are not google but do we have to act like sheep...
Disc: not currently holding CNU but will be when I think its time to board... my heart is still in the industry.
Harveyp
09-05-2014, 06:35 PM
Manual crimping vs Laser crimping would create a big difference in potential internet speeds
Manual crimping vs Laser crimping would create a big difference in potential internet speeds
Crimping at the domestic premises is probably a very good and cost-effective decision. This technique may reduce the bandwidth to an individual user (importantly, the restriction is only downstream of the crimp point) by 30% but still leaving mega bandwidth to those individual users - in practice, much more than will ever be required for a domestic user. The real bandwidth bottlenecks are upstream of that point - the absolute bandwidth only becomes important at the point where many users join together in the main trunk backbones. I'm sure on these high traffic routes that high quality machine-assisted jointing will be used to maximise bandwidth.
An analogy might be to consider vehicular traffic, we all service our houses with single lane driveways, not superhighways, and very seldom find that there is a problem with traffic jams. If the motorways were similarly constricted then there would certainly be a problem.
Another analogy might be the electricity network, none of us run 200KV circuits into our houses, the HV network is only necessary on the main distribution network.
couta1
09-05-2014, 08:28 PM
Good analogies poet, cheers.
Couta, you manage to sell up for a profit?
Holding a bit longer to see what happens, once the current little political saga blows over hopefully she will head up a bit more:cool:
BlackPeter
14-05-2014, 09:27 AM
clever move, though somehow predictable:
https://www.nzx.com/companies/CNU/announcements/250396
They announce a whole range of premium products which are not subject to regulation ... this should over time marginalise the impact of the ComCom saga ... I like it!
couta1
14-05-2014, 09:35 AM
They have also highlighted again that they will not throttle the regulated broadband service to an unusable level to drive demand to commercial products.
nextbigthing
14-05-2014, 09:47 AM
clever move, though somehow predictable:
https://www.nzx.com/companies/CNU/announcements/250396
They announce a whole range of premium products which are not subject to regulation ... this should over time marginalise the impact of the ComCom saga ... I like it!
Good to see them getting on with the job instead of sulking.
The fact that National has had a tough time recently and the latest poll still has them with enough support to govern alone is also good news for Chorus.
http://www.stuff.co.nz/business/budget-2014/10041025/National-has-no-need-to-pull-rabbits-out-of-hat
BlackPeter
14-05-2014, 09:48 AM
They have also highlighted again that they will not throttle the regulated broadband service to an unusable level to drive demand to commercial products.
Of course did they highlight that as well - and the good thing is, they have absolutely no need to throttle the regulated service ... it will strangle itself given the ever increasing thirst for more bandwidth. Just not increasing the bandwidth for the regulated service will be enough to sort out the issue.
Harvey Specter
14-05-2014, 09:53 AM
They have also highlighted again that they will not throttle the regulated broadband service to an unusable level to drive demand to commercial products.yet. And look at the talk about service levels. If you are on a regulated plan, they dont have to promise speed.
The fibre part of this news was signaled back in October 2013, but it was buried (ignored) under the deafening media doom and gloom noise when the guts fell out of the share price.
EDIT:- ah ha found the link http://www.chorus.co.nz/chorus-to-consult-on-all-new-faster-ultra-fast-broadband-products
brentk
14-05-2014, 12:16 PM
They have also highlighted again that they will not throttle the regulated broadband service to an unusable level to drive demand to commercial products.
Key part of that sentence to me is "to an unusable level" ... they haven't said they won't throttle at all - just not to an unusable level (whatever their definition of that is)
Disc: small hold
couta1
14-05-2014, 12:29 PM
Key part of that sentence to me is "to an unusable level" ... they haven't said they won't throttle at all - just not to an unusable level (whatever their definition of that is)
Disc: small hold
Probably dial up speed would be a good unusable benchmark
brentk
14-05-2014, 09:51 PM
Probably dial up speed would be a good unusable benchmark
Haha evil.
256-512kbps I rekon could be justifiably 'usable'. Could still stream lower quality & fast browsing of web / emails. Just no good for HD streaming (which notably is how they're positioning their new 'commercial' offerings) & downloading.
Ideal position for a low cost entry point (read: comcom) IMO for users who don't require heavy usage.
Harvey Specter
15-05-2014, 09:10 AM
Haha evil.
256-512kbps I rekon could be justifiably 'usable'. Could still stream lower quality & fast browsing of web / emails. Just no good for HD streaming (which notably is how they're positioning their new 'commercial' offerings) & downloading. I wonder if they have the technology to strategically throttle only certain types of data, namely those that it is important that it arrives quickly - ie. Skype, streamed video, gaming.
Lets face it, if a well designed website takes twice as long to open, does it really matter. Or if your background download/upload takes twice as long, who cares - but anything realtime is noticeable.
bung5
15-05-2014, 11:18 AM
I wonder if they have the technology to strategically throttle only certain types of data, namely those that it is important that it arrives quickly - ie. Skype, streamed video, gaming.
Lets face it, if a well designed website takes twice as long to open, does it really matter. Or if your background download/upload takes twice as long, who cares - but anything realtime is noticeable.
I think the answer is lots of people care. To have your wholesale network provider shaping traffic would be unacceptable and breaks the whole model. Effectively this is the "service" the ISP provides. Chorus is only there to provide Layer 1 and 2 access ( http://en.wikipedia.org/wiki/OSI_model)
I think however they will sneakily degrade the Com com regulated service over time effectively forcing ISP 's to use the unregulated service which conveniently is at the same price as it is currently.
Will force ISP's to offer the regulated service as a cheap and nasty broadband equivalent to what dial was 8 years ago vs adsl v1. (albeit at faster speed).
bung5
15-05-2014, 11:28 AM
Unless of course in December the Com Com regulated price is equal or higher than the current price then I guess it will make this new service irrelevant
BlackPeter
15-05-2014, 01:32 PM
Unless of course in December the Com Com regulated price is equal or higher than the current price then I guess it will make this new service irrelevant
not sure, whether it would make the new service irrelevant - guaranteeing quality of service would always command a premium. It just would make it more expensive ...
bung5
15-05-2014, 01:44 PM
not sue, whether it would make the new service irrelevant - guaranteeing quality of service would always command a premium. It just would make it more expensive ...
It does if the regulated service costs more than their premium service. Why would they want to charge less than what is required by law for a better service??
Bobdn
16-05-2014, 09:15 PM
clever move, though somehow predictable:
https://www.nzx.com/companies/CNU/announcements/250396
They announce a whole range of premium products which are not subject to regulation ... this should over time marginalise the impact of the ComCom saga ... I like it!
These plans are really amazing - an entry level plan of 100/20 for just $5 more than the price charged for old copper ADSL (come 1 December). I'm getting fibre as soon as it becomes available in my street next year. A 100/20 plan will be all I need to "do some mans work" as the Giganaire would say.
nextbigthing
20-05-2014, 08:51 AM
How does this effect Chorus?
http://www.stuff.co.nz/technology/digital-living/60069400/second-internet-cable-planned.html
Harvey Specter
20-05-2014, 08:59 AM
How does this effect Chorus?
http://www.stuff.co.nz/technology/digital-living/60069400/second-internet-cable-planned.htmlIt doesn't, or if it does, it probably helps.
The current Southern Cross cable is owned by Telecom so a new international cable is no competition to Chorus local network.
Having said that, increased international capacity may speed the introduction of new services to NZ like Netflix. If that happens, fiber uptake, and uptake of the more expensive plans may increase, shich would be positive for Chorus.
Harvey Specter
20-05-2014, 09:18 AM
How does this effect Chorus?
http://www.stuff.co.nz/technology/digital-living/60069400/second-internet-cable-planned.htmlOf more interest is who is the 'Major New Zealand company' who is providing the equity. Chorus seems a logic choice but they couldn't afford it as they are currently crying poor. THe other telecoms have formed a consortium to build a different cable that only goes to Australia so it isn't them. KimDotCom has had a bad week and he doesn't actually have any money, no is he a major NZ company so count him out. Rod Drury diversifying XRO operation - unlikely. IFT but the economics are good enough for them. Todds are my pick as they like to have their hand in everything. Or how about SKT - they could get the local license of Netflix given they have the content rights already.
Mista_Trix
21-05-2014, 10:39 AM
Webcast on now;
http://www.chorus.co.nz/webcast
Mista_Trix
21-05-2014, 10:53 AM
Link to presentation;
http://www.chorus.co.nz/file/46873/InvestordayFINALslides.pdf
Mista_Trix
21-05-2014, 05:08 PM
Not sure if anyone else listened to/watched the webcast (I caught about 1 and a bit hours of it).
But from what I saw I was happy, the institutional investors should be too, and given it rose 2.3% with 1m through, looks like they may be.
Many different elements on target, good stuff.
Bobdn
21-05-2014, 07:36 PM
Webcast on now;
http://www.chorus.co.nz/webcast
Thanks Mr Trix, I'll check it out. I'm up to my nuts in Chorus shares, which I paid far too much for and then held on to. I'm always looking for good news to ease the pain.
Mista_Trix
22-05-2014, 09:50 AM
No one even going to comment on the kick in the balls Chorus just received???
Its hard to know what to say :-S
Bloody ComCom, just do your job properly and stick to your dates.
At least by the end of the year National will likely be in again and with that as some certainty it might help move things along post election.
ADDITION: Take a look at the prices that went through off market this morning, someone sure thinks its going higher.
Harvey Specter
22-05-2014, 10:25 AM
No one even going to comment on the kick in the balls Chorus just received???I dont see it as a kick in the balls. I see it as Comcom has had CNU on the ground with its foot on its balls for the last 6 months. This is just more of the same.
It in the end this doens't matter, what matters is who is right ComCom or CNU.
Mista_Trix
22-05-2014, 10:42 AM
Others may not agree with this at all but, in my opinion there will be fewer and fewer 'shock headlines' like this that push the SP down.
It is in the long term a good investment that's sitting well undervalued with a current PE of 3.99, it is slowly drifting upwards as I am of the opinion that a lot of the issues have been priced in. Yesterdays webcast gave good reassurance of several things; that the work is on track, the more complex work (CBD's) is behind them, and the internet market is changing quite dramatically (there were some stats about the increase in online video, both year on year, and as a proportion of total internet use that were quite astounding, but not unexpected).
I will keep topping up as these opportunities present themselves, as I move more of my portfolio from short term positions to long term, for the (eventual) coming correction, as I'm sure many others are. I think this is a good long term play if you are aware of the risks and are following the developments, and I believe many of the issues have already been priced in.
Bjauck
22-05-2014, 11:25 AM
Surely the hand on the Chorus Nuclear Doomsday Clock will have edged closer to midnight! If those retailers want to be assured of faster than the contractual minimum speeds, they will have to pay for it.
BlackPeter
22-05-2014, 11:51 AM
No one even going to comment on the kick in the balls Chorus just received???
Its only a kick in the balls for investors who expected Comcom to deliver in the first place. I didn't expected anything from this highly politicised debating club and am therefore not disappointed. I believe that Chorus is on the right way with offering better "unregulated" products. If you look at the data demand increasing every year by 50%, not too many customers will in a year or two from now still be interested in the regulated base service. ComCom's decision (however it goes) will soon be irrelevant.
nextbigthing
22-05-2014, 02:30 PM
Its only a kick in the balls for investors who expected Comcom to deliver in the first place. I didn't expected anything from this highly politicised debating club and am therefore not disappointed. I believe that Chorus is on the right way with offering better "unregulated" products. If you look at the data demand increasing every year by 50%, not too many customers will in a year or two from now still be interested in the regulated base service. ComCom's decision (however it goes) will soon be irrelevant.
I agree. Maybe a little more short term pain but nothing longer term. I also wonder if they will claim they aren't slowing services but they'll have a lot of 'overloading' and 'outages beyond our control' with copper.
macduffy
23-05-2014, 08:32 AM
An Aussie perspective on CNU- from the SMH.
http://www.smh.com.au/business/motley-fool/nzs-chorus-a-stumbling-goliath-20140521-38olt.html
Mista_Trix
23-05-2014, 04:09 PM
"Chorus debt rating affirmed by S&P with negative outlook";
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11260523
nextbigthing
27-05-2014, 07:26 PM
The recent polling was very positive for National, they had the numbers to go it alone.
Question is, even if that is the case on election day, do you think National would step it at all? And if so how? They seem pretty keen on keeping the voters happy and there's probably more harm than good for them getting involved in CNU which would suggest they wouldn't. However they can probably work out a way to help CNU without hurting the teleco's which might keep them quiet.
IMHO the comcom (concon) are farrrrrr to heavily favouring one side at the moment, something that a 'business focused' government will surely be mindful of.
JAYAY
28-05-2014, 09:58 AM
Sure we aren't placing too much emphasis on the political slant for CNU? National has tried (and failed) to intervene, with even its rubber stamp partners baulking at the idea. I think CNU may be out in the wilderness here, even if National gets in on a majority ballot...
Of course the Chorus saga has been highly politicised thanks to extremist action from Hooton, Brislen, Chetwin and the rest. Comcom (supposed to be objective and apolitical) made an obviously political decsion. Sweden and Denmark??? For goodness sake.
IMHO Comcom just like all these Govt commissions have been subverted by the loony left.
My hope is that fibre technology will leave copper for dead in a very short time.
Mista_Trix
30-05-2014, 03:48 PM
"ComCom to run ruler over new Chorus products";
http://www.nbr.co.nz/article/comcom-run-ruler-over-new-chorus-products-bd-156990#comment-655962
couta1
30-05-2014, 07:34 PM
"ComCom to run ruler over new Chorus products";
http://www.nbr.co.nz/article/comcom-run-ruler-over-new-chorus-products-bd-156990#comment-655962
Overkill nanny state nonsense continues its clear the comcom isn't going to give an inch to chorus right to the bitter end, not to mention a continued bad look for overseas investors looking to put funds here, why would they?
JAYAY
31-05-2014, 08:29 AM
"ComCom to run ruler over new Chorus products";
http://www.nbr.co.nz/article/comcom-run-ruler-over-new-chorus-products-bd-156990#comment-655962
Comcom just can't help themselves. Playing for popularity with the public and still trying to vindicate themselves for driving investment away.
nextbigthing
31-05-2014, 08:34 AM
Next the concon will be donating to the Internet-mana party....
couta1
03-06-2014, 12:59 PM
Sold out my holding for a small profit this morning, until the comcom puts their stupid measuring ruler away I don't feel comfortable holding due to the fact they could try and regulate CNUs new products as well plus the extension to the FPP, still a lot of uncertainty here and not all of it may be priced in to the current price, will be back but not right now.
couta1
03-06-2014, 01:12 PM
You made a profit couta! HURRAY!!!
Yep crack open the bubbly and let's all head over to Gentrack for a stag party:cool:
Mista_Trix
05-06-2014, 08:43 AM
Bollinger bands tightly squeezed, and that 200MA is moving ever downwards.
Am I correct (with my lack of technical knowledge), that it is likely there should/could be a movement either way out of the tight bands, and its likelihood of upwards is increased by the likelihood of crossing the 200MA soon?
Any help appreciated :)
I'm having a crack, so take this with a grain of salt if I'm way off as I don't know what I'm doing ... but giving it a go none the less :-S
couta1
05-06-2014, 08:57 AM
MT I've found the charts unreliable in predicting where the price will go, last time it looked like breaking out more negative news banged it down again it has been hugging the$1.70 level for a while now and I think news rather than charts are a better indicator on this one.
Mista_Trix
06-06-2014, 10:54 AM
Jesus, $11m just went through off market...
Harvey Specter
06-06-2014, 10:57 AM
Jesus, $11m just went through off market...Was he the seller or the buyer. Maybe he has some inside information from the 'big guy upstairs'.
couta1
06-06-2014, 10:58 AM
Jesus, $11m just went through off market...
Overseas fund selling down after latest ComCom nonsense?
Mista_Trix
06-06-2014, 11:00 AM
Was he the seller or the buyer. Maybe he has some inside information from the 'big guy upstairs'.
Aren't they the same guy ...?
Is it insider trading if one portion of an omnipotent omnipresent entity tells the other portion to buy...?
Mista_Trix
06-06-2014, 11:01 AM
Was he the seller or the buyer. Maybe he has some inside information from the 'big guy upstairs'.
Aren't they the same guy ...?
Is it insider trading if one portion of an omnipotent omnipresent entity tells the other portion to buy...?
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