Telstra is going to market....will you buy their shares?

[GIDDO]

I haven't heard any commentator yet recomend the new T3 as a BUY.

The dogs are barking that the company is not worth buying into.

Given that, who will buy it?
How will the Govt manage to sell the next tranch?

Will they offer a very very gooooood deal to try to spark interest?

And if they do, does that mean that people who buy in will divest themselves as soon as possible to get their profit, thus guaranteeing a further fall in the share price.

Anybody enlighten me there. How can the govt prevent profiteering if they offer a great deal to get in.

 

[Aceyducey]

Giddo,

They could add a caveat that you cannot sell the shares until they are fully paid (after the second installment).

The primary reason people buy shares is to make a profit, so profiteering can't really be such a bad thing

Most of the time it's excessive profits (often through monopolistic power, deceit or withholding information) that our laws guard against.

Cheers,

Aceyducey

 

[GIDDO]

I like a profit toom Acey .

I was just wondering what would happen to the share price the day after the 2nd installment is due.
I imagine a lot of people would sell.
Haven't heard anyone yet who recomends the stock as a buy and hold.

 

[Beach Bum]

Some valid points Acey, but as you say Telstra is still very dominant and profitable today. Telcos can only dream of being in such a position.
Also I think they can still downsive their workforce another 10-15% within the next few years.
I aint buying yet, but I'm watching closely.

 

[geoffw]

I haven't heard any commentator yet recomend the new T3 as a BUY.

Mostly because the conditions are not known yet.

Will there be a discount? An instalment plan? An incentive to people who held Telstra shares on the day the float was announced?

 

[redwing]

Basic Chart for Telstra over the last few years; considering the Market at the moment its not too impressive.

There's been dividends of course, but the Growth hasn't been there, its still Australia's Sixth Largest Corporation though and holds a fair bit of weight in the market

 

[lizzie]

commentators said last night exactly what i said last week.

the huge expense and unweildy maintence of their landline network - combined with the fact that, by law, they cannot charge landline renters (other telcos) fair rent, will hold telstra back.

 

[topcropper]

Just a bit of trivia. This does not mean Telstra is not a buy either, it is just worth a look,....and I will admit that I have picked a better than average bunch of companies here to compare with Telstra. Just shows what some have done in the same period,.......

........................Jan2000...........today

Woolworths..........$5.24..............$20.75
Com Bank............$26.23..............$45
Rio Tinto..............$32.................$73.30
Wesfarmers..........$11.57.............$33.36
Woodside.............$11.25.............$41.60

Telstra................$8.35...............$3.53


See ya's.

 

[Simon]

If you wanted TLS shares...why wouldnt you buy them on market.

I guess there is going to have be some huge incentive to buy this way rather than on mkt.

I just read that current shareholders will recieve one free share for every 5 or 6 TLS they already own.

 

[XBenX]

Ill stick my neck out, Ill probably throw some play money at it.

PE should be around 10.

That's a solid yield play, and better than money in the bank imho.

FWIW 28c dividend all but guaranteed.

Only time will tell.

 

[manny]

I'm looking forward to seeing the full offerings once made public (ie. any benefits to existing share holders), but I do intend to buy some T3 shares when they are relased... Although TLS profits have gone backwards (no new growth), it is still a very profitable company & I personally think the share price will improve once the company can run on its own without the 51% government ownership that was holding it back...

Cheers,

Manny.

 

[cazandpaul]

We have some now that have not set the world on fire but do pay a decent dividend - will wait and see what the offer is for T3 - could be a good long term hold.

 

[TryHard]

How anyone could invest in TLS, having been a customer of Telstra, beggars belief to my blinkered way of thinking. I've dealt with them at a Corporate, Government, small business and home user level, and at every turn they have never failed to astound with their complete lack of customer focus and poor, or non existent, service ethic. They'll become some form of infrastructure-focussed bohemoth, if anything - developing products and services and supporting them is not their forte. I woudln't touch the stock at $0.05, let alone $3.00 plus A culture as entrenched as Telstra's will take a lot of years post-privatisation to recover from, * assuming * they have the right type of management in place to achieve this. Way too many emerging players that can actually look after customers will wipe (the majority of) Telstra off the face of the map.

 

[lizzie]

I've dealt with them at a Corporate, Government, small business and home user level, and at every turn they have never failed to astound with their complete lack of customer focus and poor, or non existent, service ethic.

as a past employee - i totally agree. that's why i went into the managers office in 1999 and asked for a redundancy. i could no longer stand the stat orientated customer service, rather than the customer orientated customer service.

it became all about who could answer the most calls and fudge the most stats, and be given financial rewards for it, rather than give service to the best of their ability.

i'm sorry, but my integrity couldn't survive in that environment so i left.

 

[oceangirl]

Opinion piece from SMH

Another interesting article from Ross Gittins:

http://www.smh.com.au/news/opinion/howards-crossed-line-on-telstra/2006/08/29/1156816898375.html

 

[natmarie73]

Lizzie,

At a recent recruitment workshop, the presenter told us that many people refuse to take on contracts or work for Telstra. As one highly skilled job seeker put it to her "I would rather rot on the dole than work for Telstra".

Thought it was an amusing anecdote...

Like many others, I would never consider becoming a customer or employee of Telstra, so no way would I buy their shares no matter how low they go but each to their own.

 

[WildDog]

Lizzie,

At a recent recruitment workshop, the presenter told us that many people refuse to take on contracts or work for Telstra. As one highly skilled job seeker put it to her "I would rather rot on the dole than work for Telstra".

Thought it was an amusing anecdote...

Like many others, I would never consider becoming a customer or employee of Telstra, so no way would I buy their shares no matter how low they go but each to their own.

That is a naive way to buy stock, you should be looking at their earnings, returns and Industry structure and profitability especially

1. Rivalry Among existing firm
2. Threat of new entrants
3. Threat of substitute products
4. Bargaining powers of the buyers and suppliers etc...

I dont read junk mail but I still buy SLM (People who make junk mail) because million of other people do and it's a good business and it delivers the result.
and people like Coles and Wolly cant run their business without advertising and deliver junk mail into ppl box every week.
up 22% since I bought it less than 6 months.

And the thing about shares is you got to know when the stock is over value and flock it off
and buy better stock. If you think the share is worth $6 and it's now trading $9.. I would offload it let the money sit in the bank for a little while until people sold it down and buy it again or buy a stock that is worth $5 but trading at $3 or $4 etc...

 

[Aceyducey]

Wilddog,

I don't agree with your comment about naiviety.

If you're not willing to work for a company or use their products it's very unlikely you're unique and it's a good signal that there's something wrong, even if the accountants are concealing it in the books. (IE: Telstra is borrowing money to pay dividends and is busy cannibalising their high profit businesses for much less profitable (but more futureproof) businesses...not a very sound strategy for continued growth)

Many respected stock analysts (and their books) make a point of saying that regardless of the figures, if you wouldn't buy a company's products or don't trust their management, you shouldn't buy their shares.

Cheers,

Aceyducey

 

[lizzie]

wildog - all my comments on this post are from inside experience, not just a dislike of the company. a company that does not look after it's customers will eventually lose the customers (and income) - that was a big concern on my behalf when i worked there, but obviously not a concern of the company powers. i also knew how much their hang-on products cost in negative income, like payphones, disability services, faults and installation, 000 service ... there were many other services such as this that telstra was obligated to undertake, but where huge cash leeches. add this having to maintain an aging copper network which is labour intensive (something that no other telco has to do) i can't see telstra doing well until it removes all this baggage.

i may be wrong.

 

[Aceyducey]

BTW - big article on them in the SMH today looking at how investors see the stock.

http://www.smh.com.au/news/business/hard-act-to-swallow/2006/09/01/1156817099779.html

Make a careful note that dividends are only 'guaranteed' for 2007....2008 could be a bloodbath

With 26% of voters at this stage ready to buy or consider buying, and assuming that half of those considering buying will actually buy (11%), that would suggest (drawing a long bow) that up to 16% of households may be prepared to take shares in Telstra...or roughly 1.15 million households (out of about 7.2 million nationally).

If each of these households invested an average of $5,000, that'd mean $5.75 billion invested into T3 - which amply meets the 60% of the float designated for retail investors (it's about 71% of the total $8B float).

Note that the sample size is hardly representative, however it's interesting

Will do a final set of stats once the poll closes on the hope that more than 85 out of 3,000 Somersoft members contribute to Somersoft/are interested in the topic.....

Cheers,

Aceyducey