Essentially it is the sum of (probability of event x) x (value of event x). The sum of this is not zero.

I didn't say anything about the balance sheet of Nortel or its equity. My point was about the 'oppurtunity' that Nortel eventually becomes profitable. You mentioned a possible scenario yourself – government bailout.

Essentially it is the sum of (probability of event x) x (value of event x). The sum of this is not zero.

I didn't say anything about the balance sheet of Nortel or its equity. My point was about the 'oppurtunity' that Nortel eventually becomes profitable. You mentioned a possible scenario yourself – government bailout.

Nortel is a competitive Tier 2 player in the enterprise space. They have consistent margins and this is a money maker for the company.

They have a significant installed base and good products. Their R&D burn is tiny in comparison to their other initiatives and they have happy customers coming back for new products as their systems sport a 10-20 year lifecycle. This is a great business for Nortel but it can't save the company. Mike Z and his (GE)policy of only remaining in spaces where NT can be the consistent #1 or 2 isn't a strategy that works in Telecom.

No thoughts on MSFT or IBM buying them. I'd point out that MSFT's partnership with them is shallow, and has very little depth. the IBM arrangement is as i understand a reseller partnerhship, so also very shallow in terms of technology integration. For example MSFT has a similar UC agreement with Mitel and IBM works with AVAYA.

As far as bankruptcy goes, I don't know. My original statement (or thoughts were) that shareholders currently can expect little to no value for their ownership. Its the debt holders who are funding the company and are ultimately first in line to decide where things go from here. If shareholders were funding operations out of profits or cashflow things would be different.

As all analysts give recommendations for future value based on current prospects and track records a fair statement is this: The current prospects are dismal and Management's strategic direction has been flawed for the past several years. Management has made this situation what it is (worse) and has a dismal track record and probably won't be able to turn the ship around ergo – the stock is worthless. Mark Sue is correct. Will that mean bankruptcy or a massive dilutive event – no idea.

aliases

* Realist
* SexyBeast
* Sexy Beast
* Plastered
* plastered
* Limeoid.
* Hogan
* Daniel
* JoeFriday
* Clint
* Eli

The company makes no money. Has not made any money in years. It can't sell the assets it has to meet basic needs. And it face massive liabilities in both pensions and debts that it can't possibly meet through its existing cash flow. Management has lost any credibility that it can grow the business to meet these goals moving forward. The value of the shares with its future business prospects are dismal.

The next 2-3 quarters will be financed out of debt that Nortel is blowing through. The Bond holders will demand major changes in future when they're unable to recoup their investment. Either that or another Debt Syndicated will come in with a mixture or Debt/Ownership to get past the 2011 liabilities.

No matter how you look at this, Nortels shareholders have only one business segment (enterprise) worth speaking of and to many liabilities to make a go of it. The stock has been worthless for a bit, Mark Sue is only the first with guts to say so.

And if it needed another problem, Nortel’s already underfunded pension ($1.1-billion at the end of last year) may have more than $500-million in liabilities tied to Metro Ethernet. But with roughly 53% of the $8.1-billion plan invested in equities and assuming a decline of 40%, Mr. Sue noted that the deficit may swell to $2.8-billion.
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And if it needed another problem, Nortel’s already underfunded pension ($1.1-billion at the end of last year) may have more than $500-million in liabilities tied to Metro Ethernet. But with roughly 53% of the $8.1-billion plan invested in equities and assuming a decline of 40%, Mr. Sue noted that the deficit may swell to $2.8-billion.
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http://seekingalpha.com/article/105883-r…

As I see my math is not so bad.
What Nortel can do about $3 bill Pension Deficit?
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Pension funds normally have to do a valuation of their obligations and assets every three years, and then plan sponsors have five years to fund shortfalls. However, once federally regulated funds are in a shortfall position, OSFI requires valuations to be done annually. (ANNUALLY)

Cameron said about half the pension plans OSFI oversees were in a shortfall position prior to this year, so are doing valuations annually. That means a majority of Canada's federally regulated pension funds will be required to do a valuation report at Dec. 31 this year, giving companies no leeway to wait to see whether asset values recover over the next year or two.

Another pension industry expert said the funding situation is especially exaggerated because pension funds are required to measure their obligations and assets on a “solvency” basis, which assumes a company is going to shut its doors immediately and must fund its pension now.
https://secure.globeadvisor.com/servlet/Article…

Do you think I'm crazy people?
============
re
I think you have problems.
$13.25 average PPS?
What books about investing have you read?
Don't you have friends or family to ask what to do?
Let me tell you…
even if NT recovers 25% you are just F.Uped!