| To: IceCube who wrote (445) | 7/23/2001 8:31:48 PM | | From: Ciao | | | | "I'm banking on the target prices of $80-$90 as indicated by two leading analyst." Was this target price made before April 2001? If so, did the analysts remind everyone to sell?
NASDAQ down today, below 2000, CLS up. If I was to sell into strength, this would be the time. |
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| To: xtahce who wrote (434) | 7/24/2001 8:49:23 AM | | From: xtahce | | | | July 24,2001 6:42AM Celestica (CLS) 44.81: Enters a manufacturing supply agreement with Celestica (CLS) by which Lucent will transition its manufacturing operations at Oklahoma City and Columbus, Ohio to Celestica over the next few months. CLS will pay Lucent between $550-$650 mln in cash, and Lucent will enter into a 5-yr supply agreement valued at up to $10 bln for CLS to be primary manufacturer for Lucent's switching, access and wireless networking systems products.
Celestica announces five-year strategic manufacturing agreement with Lucent worth up to US$10 billion
newswire.ca
Late June WSJ had reported an estimated figure of between $600 million and $900 million for these facilities:
smartmoney.com
X |
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| To: xtahce who wrote (447) | 7/24/2001 2:52:45 PM | | From: Marc | | | | Celestica Upbeat On Deal Despite Lucent's Problems
Updated: Tuesday, July 24, 2001 11:54 AM ET
TORONTO (Dow Jones)--Ongoing troubles at Lucent Technologies Inc. (LU, news, msgs) appeared to dampen the enthusiasm of most of the analysts participating in a conference call Tuesday about Celestica Inc.'s (CLS, news, msgs) purchase of some Lucent facilities.
As reported, Celestica, an electronics manufacturing services company, confirmed that it will enter a manufacturing agreement with Lucent worth up to $10 billion in revenue over five years. As part of the deal, Celestica will pay between $550 million and $650 million for Lucent's plants in Oklahoma City and Columbus, Ohio.
The transaction follows reports that Flextronics International Ltd. (FLEX, news, msgs) walked away from a deal for the same plants.
The market's response was also less than jubilant. In Toronto Tuesday, Celestica is off 44 Canadian cents to C$68.88 on about 266,000 shares. Lucent, which missed analysts' third-quarter expectations by a wide margin, announced 20,000 more job cuts and declined to give guidance for the next quarter, is down 17% in New York.
But Celestica executives assured analysts that the purchase, with a "premier telecom," was positive for the company.
Eugene Polistuk, chairman and chief executive of Celestica Inc. (CLS, news, msgs), boasted that the transaction was the largest the company has announced to date, adding that it will result in the expansion of its "already proven partnership" with Lucent Technologies Inc. (LU, news, msgs).
"The size and scope of this transaction recognizes the track record and trust that has been built up between the two companies," Polistuk told analysts. He said that Celestica will also benefit from an expansion of its communications portfolio, while also comfortably meeting financial criteria for acquisitions.
The deal, to close in the third quarter, will be increase cash earnings "well within" 12 months, he said.
The company also applauded its partner's attempts to reorganize its business over the last several months. "Lucent has made considerable progress in their restructuring activities, and this EMS model will clearly play an important role for them as they progress into the future," Celestica said.
Polistuk added that this transaction is flexible, for it doesn't preclude Celestica from doing more business with Lucent - or any other original equipment manufacturer - in the future. Further, production from other OEMs can move into these locations "over time."
To give Lucent the "most competitive cost" in the marketplace, much of the manufacturing will be moved to existing Celestica locations around the world, with the "high-complexity, high-skill intensive activities" remaining at those plants.
The headcount at the facilities will be "south of half" the current number, Celestica said, adding that the majority of the difference will end up at facilities in the company's network.
While the union for Lucent's workers is "fully briefed and on board," it has yet to ratify the deal. Celestica declined to comment on when the pact would receive union ratification.
Executives, who received the congratulations of three analysts, defended both the acquisition and Lucent, saying it gives Celestica a broader base of expertise while allowing it to expand its relationship with a dominant player.
"I know there's some baggage associated with some of the restructuring (Lucent's) going through, but we've worked with them for over three years, so we have a pretty good insight of where they're going and where they've come from, and we feel this is a good add to our portfolio," Polistuk said.
-Andy Georgiades, Dow Jones Newswires; 416-306-2031 |
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| To: Ciao who wrote (446) | 7/24/2001 5:48:43 PM | | From: IceCube | | | | The analyst reports were just days before the Q2 reports. Furthermore, consider the earnings estimates on Q3 and the long run and you'll notice how well CLS is poised for growth. A 10 billion dollar contract from the acquisition of two key Lucent plants will generate a very high cash flow.
CLS is a victim of the short lived "earnings report" season. Even at such it remain held up pretty strong. Investors will benefit on taking advantage of buying opportunities just like CLS continues to apply.
Comments? |
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| To: IceCube who wrote (449) | 7/24/2001 10:20:40 PM | | From: Ciao | | | | Lucent's future is uncertain, so the purchase and lease of 2 plants is questionable. The business is still a low margin, high volume business, so it would be easy to move from a profit to a loss.
I still hate the use of adjusted earnings. The company grows from acquisitions, so lets talk net earnings which takes into account goodwill charges. Goodwill represents "overpayment". IMHO CLS is overvalued. With the talk of a global recession, I dont't see thinks getting better for at least a year. |
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| To: Ciao who wrote (450) | 7/25/2001 9:09:20 PM | | From: IceCube | | | | When CLS takes over the operation of the Lucent plants, clearly it's the only remedy for profit. Those plants need positive cash flow in order to implement real growth in that sector. Celestica will meet and surpass this requirement. A $10 billion dollar US deal is something worth investing in. CLS could have made the mistake of buying these plants earlier when they were over valued.
Long positions will be fairly compensated. Can't say much about shorters however... |
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| To: Arthur Tang who wrote (452) | 8/26/2001 11:34:18 AM | | From: Clement | | | | (OT) Arthur:
I expect my arguments to be judged on their merits. That has been the claim from the beginning. If you choose to continue this infantile behaviour, that is certainly your perogative and I have no objections but others on this board might.
I continue to hold Celestica at a profit and I think their business model will by highly lucrative in the future. My opinion of EMS providers is that they are the bullet makers in the tech wars who will survive no matter who wins. Those with enough mass around the world will most efficiently be able to allocate resources as large companies will award them the most contracts because of their geographical coverage and ability to use economic advantage most effectively.
What is your opinion Arthur?
Clement |
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| To: solderman.com who started this subject | 1/11/2002 12:32:52 AM | | From: xtahce | | | | Celestica looks to rebound from tough year
By EBN
Jan 9, 2002 (9:56 AM)
....Marvin MaGee, president and chief operating officer, says the Toronto-based company will reach $20 billion in revenues in 2004. Prior to announcing the deal with NEC, he spoke with EBN senior editor Claire Serant about the company's customer relationships and outlook...
Continued...
circuitsassembly.com |
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