Re: Hard to believe it..- From
I think its several issues:
1. Lumn has not presented any positive information with regards to what matters most: business growth. What's included in the annual outlook is contingent on gov't contracts, growth in new products and stabilization of enterprise metrics. There is no evidence that any of these are happening. We win a contract for 11 yrs/56 million while T and VZ are winning contracts worth billions. Why didn't we cut the deal with TMUS quicker to compete with what T and VZ can offer?
2. Small business sucks, going back to the office taking much longer and competitors are more nimble handling those that are.
3. Hyperscalers, monopoly builders, those that were successful last time are still doing well, getting the benefit of the doubt, likely telling WS that edge will not interfere with their dominance, no sea change, telecom carriers except TMUS expected to lose again.
4. Storey has mentioned don't expect anything this quarter, its next quarter when it starts.
5. Rumors of a transaction that has not happened, just like Latam. Apollo, savvy investor, likely leaked prospective deal. If Lumn leaked it, thats pathetic, means assets are not drawing shareholder accretive bid.
5. No deals, just continued capex expansion.
6. Many partners, WS assumes Lumn continues to take it in the shorts on terms.
7. Momentum investing, growth investing still in play.
8. Amongst S&P, Lumn always easy target, easy short.
I could mention a few more but you get the point. From its high close last month, Lumn has now shed about 18%. I think odds are good this earnings release will be more of the same. Will it ever turn? No one knows, but past history and current sentiment indicates it will not be this quarter. And even if its not a disaster, with analysts price targets, it was an easy sell/short at $15+ for many.