Ma Bell -- An $80 billion shorting opportunity

[Whoha]

Re: Ma Bell -- An $80 billion shorting opportunity

Originally posted by DanS
Ma Bell is back! AT&T was just bought by SBC, and SBC's name is being changed to AT&T.

Here are the stats. $80 billion market capitalization. Earns about $6 billion a year on revenues of $40 billion. But the voice network is no longer a monopoly, as Voice over IP takes hold.

The math problem is this. What would be the rate of decline in the business necessary to make this stock a shorting opportunity?

they can attack VOIP bureaucratically through such things as a 911 requirement and so on, so its probably not a good bet to short it yet.

[Dinner]

Originally posted by KrazyHorse
I'm with Japher on this one. I think that in order to be comfortable with shorting them I'd have to expect declines of ~10-12% p.a. over the next couple of years to guard my position against a changing business model.

I don't know if I'd short them but big mergers have a history of having difficulty forming one coherent business out of the two different parts.