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openhandedgrouse (< 20)

OIBR: Be greedy when others are fearful.

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4

July 29, 2014 – Comments (3) | RELATED TICKERS: OIBR , TEF , PT

OIBR stats
Market cap 5.7 BRevenue 12.45 B52 wk range (0.63-2.34)Price/book 0.2Debt 15.9 B
PROS
OIBR at 0.67 is dirt cheap.TEF's price/book is 2.57AMX's price/book is 5.24OIBR's price/book is 0.2
Strong leadershipZeinal Bava started as CEO of OIBR in June of 2013. He was awarded best CEO in investor relations in 2009. In 2010 and 2012 he was best CEO in European telecommunications. In 2011 he was 2nd best CEO in European telecommunications. He was also best CFO in European telecommunications in 2003, 2004, and 2005. 
Cons
OIBR has a large amount of debt. They have had decreasing earnings over the last few years. They recently had a massive share offering in May of 2014. They offered 2.14 B common shares and 4.28 B shares for 0.90 to 0.97 USD.
I believe there is fear that OIBR could offer additional shares at even more distressed prices to make up for a 1.1 B shortfall from PT. As of March 2014 OIBR had 10.8 B in liquidity. I believe that they have enough liquidity to remain competitive even if they don't get any additional money from PT. 
There are reasons to be fearful. I feel that this fear is priced into the stock price and I'm personally using this fear to be greedy. 

3 Comments – Post Your Own

#1) On August 01, 2014 at 7:14 PM, OHGtop10 (< 20) wrote:

Mkt cap now 5.3 billion with shares trading at 0.62. I bought another 1000 shares for a total of 3000 shares and currently my largest position. Oibr should still have over 9 billion in liquidity.  I'm hoping that  Bava's leadership and experience will help OIBR and corpco survive and grow. My hope is that one day the dividend I receive is greater than the current stock price. I hope stock price doesn't crater further after quarterly report. We will see. Definitely a risky endeavor but if successful they are undervalued. 

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#2) On August 05, 2014 at 10:05 PM, OHGtop10 (< 20) wrote:

Next buying opportunity will be at 0.50 to 0.52 if it gets that low. 

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#3) On August 05, 2014 at 10:13 PM, OHGtop10 (< 20) wrote:

Oi wifi hot spots increase 58 percent in the last 8 months from 505,000 to 800,000. 

http://www.telecompaper.com/news/oi-reaches-800000-wifi-hotspots-nationwide--1029607

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