Analysts' views differ on Centel
Article Abstract:
Centel Corp's market value has risen from $3 billion to $3.9 billion in the wake of its announcement to sell all or part of the company, but business analysts hold differing opinions of Centel's true value. Some analysts contend that a company acquiring Centel would take ten years to recoup its investment. Others argue that Centel could be worth up to $5 billion and would generate ample cash flow from cellular and local telephone businesses to more than justify the purchase. Centel's core of operations is in local telephone service, and state regulations have kept revenue low to keep customer rates low. Centel earned $111 million, or $1.31 a share, on $1.18 billion in revenue in 1991. The figures were $47 million in earnings, or $.54 a share, on $1.15 billion in revenue in 1990. Centel is the last independent cellular telephone company, making it an attractive prospect. To make Centel a profitable acquisition, the cellular business must fulfill its growth promise and local telephone rates must come into line with the market. Stock buyers must weigh the benefits before taking a Centel-investment risk.
Publication Name: The New York Times
Subject: News, opinion and commentary
ISSN: 0362-4331
Year: 1992
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Size may hamper dissidents
Article Abstract:
Some of Centel Corp's largest shareholders oppose the proposed sale of the company to Sprint Corp. In May 1992, Centel Corp, which provides cellular and regular telephone services, announced an agreement to sell the company to Sprint for $3 billion of Sprint's stock. Centel holders had expected $4 billion, and when news of the agreement was released, Centel's stock fell 25 percent. On Jul 13, Moran Asset Management, which owns about 500,000 Centel shares, said that it continues to oppose the sale and will vote against it. Institutional investors hold significant power in this situation, owning more than half of Centel's 85 million primary shares, but some circumstances favor Centel's management. Large shareholders are hampered in Kansas because laws there, which are written to prevent hostile takeovers, restrict large holders' activities.
Publication Name: The New York Times
Subject: News, opinion and commentary
ISSN: 0362-4331
Year: 1992
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Making a case for U S Sprint
Article Abstract:
US Sprint's residential business is weak, but the company's stock is still recommended by some analysts. By the end of 1991, the company had 9.8 percent of the market which was only a few points higher than 1990's market share of 9.5 percent. By comparison, MCI has 19 percent of the market, up slightly from 18.4 percent and AT&T has 67 percent, down from 68.2 percent in 1990. Sprint's stock is cheap, which is one reason some analysts suggest the company, but the majority of analysts are bearish with the parent company, United Telecommunications. United Telecom has unpredictable stocks, even though the company earned $1.65 or more a share in 1990. The company expects that figure to rise to $2.00 or more in 1991. The recession has hurt almost all the major long-distance carriers, slowing down growth considerably.
Publication Name: The New York Times
Subject: News, opinion and commentary
ISSN: 0362-4331
Year: 1992
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