NT Plunges to All-Time Record Low

By Mark Evans | Published: September 17, 2008

Clearly, investors see the Nortel’s downsizing announcement, including the sale of its Metro Ethernet Network business, as a a five-alarm fire.

The stock has plummeted 40%, or $2.14, to record low of $3.16 this morning, including an intra-day low of $2.93.

Nortel now has a market cap of $1.57-billion. And for what it’s worth, it’s now trading at 2.4% 0.24% of its record high of $124.10. (or $1,240 when you take into account the 10:1 stock consolidation).

More: The analysts have started to jump off the S.S. Nortel. JP Morgan analyst Ehud Gelblum downgraded Nortel to “sell” from “buy”, citing the U.S. spending slump and the weakness the company faces in two of its core businesses. “We now believe it is unreasonable to assume that Nortel can grow either its carrier Ethernet or enterprise business materially in the near term,” he said in a research note.

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  • Satheejan Gugananthan

    Wouldn't that be 0.24% because of the 10 to 1 consolidation ?

  • concerned for jim

    “Nortel now has a market cap of $1.57-billion. And for what it’s worth, it’s now trading at 2.4% of its record high of $124.10″

    Mark, if you are referring to the record high on the Toronto Stock Exchange, then you need to factor in the 1 for 10 reverse split. Factoring this in, the record high is $1,241.00

    So how much has been lost?

    Based on today's low of $3.00,

    Percent Loss = ($1,241.00-$3.00) / $1,241.00 x 100 = 99.76%

    or, it is trading at 0.24% of its record high.

    I think it's fair to say that the current management has completely lost confidence and credibility. The current credit/financial markets do not help, and nor will the debt/cash ratio that Nortel will soon reveal. Any company that has debt exceeding cash, and negative cash flow will be feared in this market.

  • http://www.allaboutnortel.com Mark Evans

    Yes, you're math is right; mine not so much. I've made the edit.

  • concerned for jim

    “Yes, you're math is right; mine not so much. I've made the edit.”

    “Nortel now has a market cap of $1.57-billion. And for what it’s worth, it’s now trading at 2.4% 0.24% of its record high of $124.10.”

    Mark, you still need to edit the record high price… should be $1,241.00

  • protosphere

    Hit a new low of $2.97 in this mornings trading so far. So much for the analysts consensus of 6 bucks huh?

    Cash at $2.6B?!

    As per Globe & Mail:

    “Just last month he said Nortel's growth would be in the high single-digital to low double-digits over the next three years. “We are moving now from transformation stage to growth stage,” he told analysts Aug. 1 on the second quarter conference call.

    On Wednesday, Mr. Zafirovski said Nortel has hired an investment banking firm to find a buyer for the company's Metro Ethernet Networks business. The unit, which makes gear for delivering multi-media content over local broadband networks, accounted for 13 per cent of Nortel's $5.38-billion in revenue in the first six months of the year.

    “Our strong preference would be for a disposition that involved cash,” he said.

    Pavi Binning, the company's chief financial officer, said Nortel's cash balance at the end of this month could be as low as $2.6-billion, or about $400-million less than at the end of June. Nevertheless, he described the cash position as “strong” and said the company remains able to make interest payments on all of its debt.”

    Dare I present myself as the bearer of bad news to reiterate, it sounds like they won't make it.

    Heh, even the stalking multi-ID cheerleaders like creatively named “Concerned Jim” , real concern heh, posting information on defrauded shareholders is starting to see the light…

    Amazingly entertaining… others pumpers on Yahoo are trying to regain credibility claiming they shorted the stock and are still seeing money with their relentless buy this stock no matter what positions.

    Charts indicate it is a dog. 2.97 Low… wait just hit 2.95… make that 2.92 now … 12:05PM… and tanking….

    Thats like 29 cents presplit so far,,,, lets see what the new low today will be

  • exnt2

    Thank God I left with the package. Pity the MEN folks. They are just going to be booted around, some even without a parachute from the new company.

    This time 'hopefully' all the worms are exposed and booted out to save jobs for people who actually work.

  • concerned for jim

    Proto, don't worry about the rest of us too much. We know what's under your skin fella and it's not pretty.

    Something not right about you as many have pointed out. It's sanity related but you wouldn't know, you live in your own world.

  • creditcall

    watch the next few weeks as credit calls come in. the company is going down into chapter 11. you can just see it before your eyes.

  • Nortel watcher

    It makes perfect sense now….the reason why almost everyone in the Nortel leadership didn't buy shares since the cabdriver announced over one year ago that $19 was a bargain basement price is because they knew better…

    exnt2, I also hope the staff cuts leave behind those most deserving but it has always been and will continue to be a “beauty pageant” approach as to who goes and who stays..

  • Tims

    penny stock. junk stock. its not even worth a Tim Hortons small cup of coffee. 0.29c. I hope the board puts Mr Z in economy class near the toilets when he flies to meet customers.

    people playing in the nortel golf tournament are putting exec pics on their golf balls. it does wonders for their strokes.

  • A Close Observer

    Selling Metro Ethernet…partnering in Wireless. This is the beginning of the end of NT as we know it.

    It could be slow and painful, i.e., NT shrinks into obscurity in Enterprise. Or it could be alarmingly quick, as customers desert it because it looks like it’s a high-risk supplier in its death throes, further fueling a vicious downward spiral. It could be quicker still if a company snatches them up a their current fire sale market cap. Sometimes these things unravel pretty fast.

  • exnt

    Top 10 Reasons for Nortel's New Strategy:

    10. 6 Sigma revealed to be an exec Ponzi scheme
    9. Hackney beat up Riedel in parking lot after he was cut off
    8. Mike's big severance bonus is only good until end of 2008
    7. Hoping for Government bailout from India where they have the most employees
    6. 29 cent share price just a liittlle embarrassing
    5. Big customer said “I won't buy any more of your sh#t!”
    4. Employees leaving company for jobs at Tim Hortons slinging double-doubles
    3. Conrad Black taking over as new chairman
    2. They only look at the numbers twice a year and they finally noticed no one was buying something.
    1. Mike Z has a better offer to run the Lehman bankruptcy

  • protosphere

    I never said I worried about you. It is you claiming concern.

    I do not post for you,

    What “sanity related” when it is you claiming “we” “many” and “us” (so you are not alone pasing judgment as a syndrome expert) sporting this ID contrary to concern.

    yep, nuts alright but it isn't me

    Makes me wonder what “is under your skin” instead with a stalking ID attacking defrauded shareholders too

    Maybe you can try and muster some credibility acknowledging facts today to pump again in the future with another sincere personality.

    Now go away, you post jibberish unethically and shamelessly pumping this dog / turd with many IDs from a multiple of it value to bashing it today.

    “pretty” or not and calling others “fella” strike me as somewhat fruitcake “related” because you are not educated enough to be artsy if I were to analyze you

    As for living in “my own world”, well $2,60 low so far genius, welcome to my world.

  • concerned for jim

    What a post, lunacy in it's finest form. Are you under the influence again fella?

    How about you tell us about the Cisco lawsuit again? I'm sure that would be refreshing knowing your source was just another message poster like you.

    Pathetic.

  • Tongue.In.Cheek

    I guess that is possible if the lending institutions decide to break the covenants they signed up for in the agreements. Possible, but highly unlikely.

  • Tongue.In.Cheek

    I guess that is possible if the lending institutions decide to break the covenants they signed up for in the agreements. Possible, but highly unlikely.

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