Portugal Telecom, SGPS (ADR) (NYSE:PT)

darkflame (97.05) Submitted: 7/15/2007 9:16:43 AM

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Well.... more about PT. I forgot to tell, this is a growth company which in our own country is considered as a blue chip. You know, they have most of the fixed land phone market and they also own most of the mobile phone market. Also, the company thet are spinning off will compete directly with them soon. So, the prospects seem bad.Furtunally a few things are relevant. First, portuguese investors are by far less smart as americans, if you ever speak about value investment to a portuguese investor he will likely say "uh??? what ?". Yeah, investors there are still in the beginning on the 20th century, sad but true. So, that makes it a wonderfull place for finding hidden gems. As I was saying, prospects for PT don't seem that good, but they are! The company is growing a lot even if most of the business in Portugal is declining. THey are growing in Africa and Brasil!!!! WoooooHooooooo. I read their annual reports because PT represents more than 10% of my portfolio, and probably I'm one of the few investors with less than a few million euros doing that.LISBON, Jul. 6, 2007 (AFX International Focus) -- Portugal Telecom SGPS (NYSE:PT) is preparing an announcement regarding new investments in Africa, Lusa news agency reported, citing Joao Pedro Baptista, who is in charge of the group's international investments.Also, the portuguese stock market is soooo obscure,appart of the two NYSE ADRs (PT and EDP) you can't find ready calculated P/Es and things like that, you actually have to download annual reports and do the work yourself. Boring? Well... sort of, most people don't even know what P/E is or give it any importance. Most stocks just really follow the news, any investor with 2 neurons can thrive and surf through sell-offs.And for ending, I will post these news.-------------------------------Baptista said that 'Africa will contribute in a very significant way to the growth of revenue and profitability of the group,' according to Lusa.'In two months, we will be able to finalise some of the projects we've been working on,' Baptista said.Baptista added that the new investments will reinforce the group's position and show its capacity in the international arena.PT's strategy for Africa is based on forecasts of growth for the telecom sector, especially in the mobile area, due to the current low penetration rates.'Our strategy is to invest in businesses or acquire licences, specifically in sub-Saharan Africa, in countries where there is profitability,' Baptista said.

darkflame (97.05) Submitted: 9/25/2007 6:38:44 PM

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This post is about Portugal Telecom (PT), I worry about it because I'm a "major shareholder", which in this specific context means that it's my biggest position :-) But as the stock where most of my money is invested, my interests are aligned with the ones of major shareholders too.Today I read that Portugal Telecom wants to be a massive Telecom superpower in the world in the terms of companies like Telmex, investing in Africa and South America. That's fine, or even sounds extremely sexy, but I thought right away "Where are these guys going to get the money for that?", I mean, if I was given 700 billion dollars I could launch a buyout offer and eventually buy every single stock from GE and for a while I would be the proud owner of the company with highest market cap in the world. Me, being but a little portuguese fellow, sitting in the throne of.... ok, back to reality, while I like GE and I am a proud stockholder paying 700 billion would probably be a bit too much.And so I started digging into a few reports and discovered a few interesting things about PT, unrelated to their aquisition plans.1. Net debt has decreased by 111 million, despite the buyback of 106 million and the extraordinary contributions to the pension fund. - Nice nice. Happy to see my company is investing a lot and even so is managing to decrease debt. What a cash cow!2. Unfunded pension liability after tax decreased to 1.1 billion - PT used to belong to the state, people hired until 1994 people who worked for PT had too many beneficts and that has been a big black hole in the past. But year by year it gets better. 3. 2.1 billion share buyback - Well, cool. Old story, but nice to remember.4. Will pay around 1.1 billion in dividends for the period of 2008 and 2009. Ahhh, this is relevant. Seems like the dividends are expected to be raised again. Good news.So far, so good.But the thing that was still worrying me were the planned aquisitions, and I wondered right away what would be the best way to study how good are these guys buying companies. Well, easy, lets check one of their latest aquisitions, randomly! Simple, practical, beautiful."July 26, 2006 NAMIBIA POST and Telecom Holdings Limited (NPTH) and Portugal Telecom yesterday concluded a share sale agreement and a shareholders' agreement, officially finalising the acquisition of 34 per cent of the share capital in Mobile Telecommunications Limited for N$1,02 billion."1.02 billion Namibian dollars...ok, that's about 145 million dollars... not that much :-( but ok."MTC was established in 1995, currently has around 507 000 subscribers and is expected to generate revenue of N$1,5 billion in the current financial year, an increase from N$866 million earned in the 2004-05 financial year."Ok, so far, nothing too exciting. Also I have to notice that Namibia has about 2 million people and so the penetration rate is still very below other African countries like South Africa (which Namiba used to belong to) which is 45% and boooooming.But anyway, that was a year ago, by now we should be able to see how much is that 145 million dollars investment in Namibia returning to us, shareholders.I found the key indicators in a nice excel sheelt at www.telecom.pt and quickly discovered that the number of customers from MTC (the Namibian Telecom investment) increased from 609 thousand to 639 in the end of the first quarter of 2007 and is currently 705 thousand. Pretty nice growth uh ? It's like APPL or something, but costing much less. Profits decreased,but I wouldnt worry too much about it, this time I will just trust the management and believe they spent my cash investing it properly, after all, no reason for doubting on this particular issue. Anyway, profits in dollars is 41 million. So, in one year, PT invested 145 million and got 41 million profits from that investment ? If I didn't screw up anywhere on my calculations, that sounds GREAT!!! Since PT calculated EDITDA from MTC is 51.9%, probably I didnt screw up.So, what did I conclude for now ? I concluded that the management in PT is investing my money and often it's the case that officers wouldnt be able to invest my money better than I would, but in this case seems I bow and take my hat. Great job. No reason to doubt that in their new aquisition plan the ghost of overpayment will hover above my cash (yes, my cash!).I buy most of my clothes in Zara because I like to dress with great style without overpaying. So, why would I let PT overpay with my money ? duhhhhhThat's all Folks.(and this post will double as an entry in my PT pitch and as a canoo paddle)

KatWoman50 (87.64) Submitted: 10/30/2007 11:29:09 AM

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soooo..... what happened today? I'm hoping the precipitous drop in price had to do with the spinoff but haven't found confirmation of that in the financial news or even on PT's site. You're our ears on the ground there....
Kat

darkflame (97.05) Submitted: 10/30/2007 11:54:57 AM

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Hi Kat :) Everthing is fine, no worries.The PTM shares from the spin-off are only being deposited in some days. The PTM shares are considered as a dividend and today is the ex-dividend date (or ex-spin-off) date, so today the PT share price was adjusted subtracting the market cap from the 58% of PTM that PT held. PTM is worth like 4 billion euros or so, so PT got a temporary shave of than 2 billions in market cap.PTM is going to be consired as a dividend at CAPS because for the moment there won't be a ADR for PTM. It might take a few days but don't worry, you will get your points back.PTM is a subsidiray company called PT Multimedia and trades with a P/E of round about 40. I'm glad PT finally dumped PTM :-) Meanwhile PT shares are already up and trades with a P/E below around 10. A growth stock with a low P/E, isnt it beautifull ? PT is losing their communications market share in Portugal so Mr. Portuguese Market treats it like a boring old stock and forgot that the company is growing wild in Africa and South America, and forgot their new businesses in Portugal such as domotics or IPTV. Cool uh ? :-)Maybe If you can speak spanish then maybe you can understand a bit of written portuguese :))))http://www.jornaldenegocios.pt/default.asp?Session=&SqlPage=Content_Empresas&CpContentId=304973(basically says what I explained)http://www.jornaldenegocios.pt/default.asp?Session=&CpContentId=305021Basically says the the dividend yield of PT after spinning off PT is 6.6%, that PT is going to buy back 1 billion euros in shares and that the price target is 9 euros, which I think is too low, PT is worth no less than 11 or 12 even without growing.Aires

FleaBagger (98.34) Submitted: 3/19/2008 3:57:47 PM

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What makes you think half of the top 200 aren't Portuguese?