Nortel in a “Tailspin”

mayday mayday mayday.

the rudders blew off (when Z came on board). engines caught fire (when Hack and the other cronies arrived). mechanical problems (with six sigma etc). cockpit computers a mess (so pilot Z cannot navigate).

not enough gas. have to eject some cargo and passengers to reduce the load. landing gear is busted too so crash likely.

this was inevitable. bow down to you Z. bow down to you for getting 30 million with millions more in pension for doing nothing achieving the same results that could have happened without you.

Flat spin, not tail spin. Unrecoverable in most aircraft even with a good pilot, and Nortel has a bad pilot.

I bought 4 shares for a buck today :)

Nortel is in a "Tail Spin". I regret to say it is just a mater of time.

It's clear that Nortel is in a tailspin. Will it pull out? It does not look good. That said, Motley Fool's methodology entitles it to the designation of Very Foolish.

Their site lists five companies with Motley's CAPS rating. Presumably, the idea is to show that the CAPS rating (1star is the lowest rating and 5 stars is the highest) corresponds with stock price performance.

Nortel has a CAPS of 1 and it's recent four week stock performance is -50%.
However, the fifth company on the list is Constellation Energy. It has a CAPS of 4. Yet its performance is -59%, worse than Nortel.


While I concur with Motley that Nortel is a disaster, their analysis method stinks and their much vaunted CAPS rating is not something to rely on.

jayemmay

It's clear that Nortel is in a tailspin.
====
re
I challenge you and anyone!
Show me worse stock than NT.
Show me one
You have to find one which lost it's value from $1240 to current $2.40 /that's NT/
Show me one worse stock than NT!
Bo Gowan can reply if he wants to.
He thought I was a liar predicting 3-4000 job cuts in 2008
What about 2009 revenues?
Any site shows 2009 in a toilet!
Even Mark Evans calculated that NT would be $4.8 bill revenue company in the future.
I tease Mark Evans often, so he deletes my messages. I think Mark, you should post all my messages you deleted.
They were right on target. It was your limited mind that did not understand my message. The message was clear
NT stock is going under!
Why I could not use your blog to inform my family and friends about NT stock and the risk of investing in that stock?
OK Mark Evans
If Nortel is gone I wish you start All about AAPL blog.
So interesting!

Bold moves needed to be made 3 years ago when there was still time to act; this is no bold move, only a desperate one! Ego was the rule of the day then, fear is the rule of the day today...--bb

bill, Exactly right. There was time when the Garys were in charge, and there was a little time when Mikey Z arrived, but its too late now.

Please give credit to Nortel for actually making a bold move that should give them more focus. The status-quo and some minor moves did nothing. Removing the executive ranks would put the stock to < $1. If Nortel actually made a profit in a quarter everyone would be jumping on the bandwagon.(i.e. the sentiment would drastically change). The stock would be worth about $20 to equal revenue. From the numbers I looked at MEN didn't make any money. Sure it may be growing, but if your costs are too high...why not bail? A low cost rival can probably make money at it.

A bold move would have been to sell off the wireless biz when Nortel killed off GSM, sold off UMTS, killed WiMax and lost share in CDMA. With 60% of revenues they could easily have got 3-4 billion cash selling to Alcatel, Ericsson and Nokia.

With wireless dead there is nothing carrier in Nortel anymore after MEN goes. It will be purely Enterprise but what is it composed of? old Baystack oops. OEM from Polycom for Telepresence. that relationship can change in a heartbat. Unified Communications. ok cool but its quite competitive. The technology is going to Microsoft anyways. Ethernet but then enterprise usually buys from carriers. VOIP phones. Aah a commodity compared to Avaya, Cisco, Polycom, Aastra.

This will radically change Nortel as it has been a carrier focused company for 30 years. Carrier was the core. Not anymore. Even being ex nortel I know this wil kill whats left of the company.

Yes, isn't MZ doing a stellar job? WHERE IS THE BOARD?

Selling off a mature declining business would be a bold move that makes good business sense. Same for selling off a niche business that has a limited revenue ceiling. Selling off your biggest prospect for growth when growth is your single biggest challenge is insane.

I doubt very much that changing out the executives would push the stock down. It's all in how you do it. If you do it all at once and the new guy has a positive reputation, the stock might double or triple overnight. The market has lost faith in the Nortel leadership. We need bold moves to solve that problem first and foremost.

"I still hope (and don't care if you agree) that the company finds a way to succeed."

I hope Nortel finds a way to succeed too. Absolutely. I think it's a long shot now but I passionately believe that step 1 is to replace MZ, step 2 is to restructure/renew the cabinet, and step 3 is to restructure/renew the board. Without these actions, the company is in great peril. Even with these actions, it will get darker before the dawn and shareholders need to understand that. By continuing to allow this board to govern Nortel, the shareholders have chosen a painful path.

MZ and his team of non-experts are a malignant cancer on Nortel. Recovery will only start with their removal. Nobody believes anything they say anymore.

"I hope Nortel finds a way to succeed too. Absolutely. I think it's a long shot now but I passionately believe that step 1 is to replace MZ, step 2 is to restructure/renew the cabinet, and step 3 is to restructure/renew the board. Without these actions, the company is in great peril."


I agree Mike Z has to resign or be replaced immediately,he has been the captain of this troubled ship and has been behind the wheel since it was $32 all the way down to a pathetic $2.48- a market cap in which is less than the suspected value that Nortel's MEN unit wil fetch.


Z has been claiming that Nortel will be a growth story,but overall the opposite has been true,and now with the economy itself in trouble this has really put the squeeze on Nortel as evidenced by "the status quo is not an option for Nortel" remark made by Z.


Z made have done a good job of squeezing excess cost structure out of Nortel's organization,but unfortunately he and his team have failed to make any significant overhaul within the company.

Personally I don't think things are adding up-for one thing when looking back why did they really implement a reverse split when history shows us that in most cases the stock usually end up back where it was at pre split prices,and here we are a whopping 90 percent decline since the reverse split.

Another thing that I find peculiar is the fact that Z bought stock on the open market at $19 a share and told shareholders that this was a good price-huh!

Either way this latest announcement of further restructruing along with the intent on selling the MEN unit just shows that there was vry poor anticipation on the part of the CEO and BOD who are as usual asleep at the wheel.There really is no excuse for this,just look at Cisco and forecast and how it differs greatly from Nortel's.

Nortel could only dream of having a CEO that could anticpate market conditions before they arrive and avoid smacking shareholders across the face with a revised revenue projection so differrent from just one month ago!

Yes, regardless of whether Nortel deserves bashing or not, Motley Fool loves to use Nortel as the poster child of everything bad. So when there's good news from Nortel (which has been rare) Motley Fool has nothing to say or otherwise diminishes it. And when there's even a hint of bad news, out comes the parade, with trumpets blaring. Some of the folks on this board are marching right there with them. Too bad that right now there's so much bad news from Nortel - it just seems to put everything into a death spiral of bad news leading to more bad news. I still hope (and don't care if you agree) that the company finds a way to succeed.

You invest as Motley says and don't lose your shirt. Could they be members of the secret society bent on destroying Canada? For oil and stuff?