Forum Archive Index - November 2002

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi Bill

>
> 
>Have you ever done an analysis on Telstra or Telecom? 
>If so, any chance of sharing it with us? 
>
>

Have a look on the focus investment group.  'Mikevan' has looked at 
Telstra recently.

But the short answer is:

Telecom for income investors.

Telstra for growth investors

>
>
>I seem to remember reading somewhere that "Buffet", likes to buy 
>shares at somewhere between a third to half of their book value. 
>

Actually I think it was Ben Graham, who liked to buy things at well 
below book value.

However, if you look at p46 of the Telecom Annual report you will see 
shareholders equity of $1,328,000,000.  Given that there are 
1,873,817,760 shares on issue  this gives an asset backing per share 
of only 71c at end of FY2002 , down from $1.08 at the end of FY2001.

So Telecom is trading at over six and a half times book value.  
Hardly a bargain in those terms!  I would describe the position of 
Telecom as 'vulnerable'.

>
>If so, then Telecom shares would be at fire saleprices.
>

Actually I would describe Telecom as more expensive today, based on 
fundamentals, than it has been for several years.  The dividend yield 
is still OK though.

SNOOPY


   
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Message posted by Harry Tennyson
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