Stock Alert for Motorola Inc. (MOT)
Motorola Inc. (NYSE: MOT)
Motorola Inc. (MOT) offers technologies, products, and services for mobile communications worldwide. Its portfolio includes wireless handsets, wireless accessories, digital entertainment devices, set-top boxes and video distribution systems, analog and digital two-way radios, wireless and wireline broadband network products, and end-to-end enterprise mobility products. The Company operates under three segments: Mobile Devices, Home and Networks Mobility and Enterprise Mobility Solutions. In April 2009, the Company completed the sale of its biometric business unit, including the Printrak trademark, to Safran SA, through its wholly owned subsidiary, Sagem Securite. In January 2010, the Company acquired SecureMedia from Innovation Advisors. In February 2010, the Company acquired BitBand, a provider of content management and delivery systems, specializing in video on demand for Internet protocol television (IPTV). MOT markets its products and services through direct sales, distributors, dealers, value-added resellers, independent software vendors, original equipment manufacturers and service operators.
The Company was founded in 1928 and is based in Schaumburg, Illinois.
| Share Statistics (19-May-10) | FY
2008 |
FY
2009 |
%
Chg |
Q2 2009 | Q2 2010 | %
Chg |
||
| Symbol | MOT | Revenue, $Mn | 30,146 | 22,044 | -26.9% | 5,371 | 5,044 | -6.1% |
| Current price | $6.81 | Gross marg. | 27.8% | 32.0% | 15.1% | 27.9% | 35.4% | 26.9% |
| 52wk Range: | 5.72-9.45 | Oper. margin | – | -0.72% | – | – | 1.33% | – |
| Avg Vol (3m): | 26,308,100 | Net margin | -14.1% | -0.2% | -98.6% | -4.3% | 1.4% | -132.6% |
| Market Cap. | 15.83B | |||||||
| Shares Outstanding | 2.32B | EPS, $ | -1.15 | 0.05 | -104.3% | -0.09 | 0.04 | -144.4% |
Source: Reuters.com, SEC Filings.
Financial Summary
For the first quarter of 2010, the Company highlighted the following results:
• First-quarter sales of $5.0 billion
• First-quarter GAAP earnings of $0.03 per share, compared to a loss from continuing operations of $0.13 per share in first quarter 2009; first-quarter 2010 GAAP earnings include income of $0.01 per share from highlighted items
• Total cash of $8.5 billion, a sequential increase of $455 million. (Total cash equals Cash and cash equivalents plus Sigma Fund (current and non-current) plus Short-term investments.)
• Enterprise Mobility Solutions sales of $1.7 billion; operating earnings of $141 million
• Mobile Devices sales of $1.6 billion; shipped 8.5 million handsets, including 2.3 million smartphones; operating loss of $192 million
• Networks sales of $896 million; operating earnings of $112 million
• Home sales of $838 million; operating earnings of $20 million
Source: http://investor.motorola.com/
| Financial Strength (19-May-2010) | Company | Industry | Sector | S&P 500 |
| Quick Ratio (MRQ) | 1.86 | 2.26 | 1.38 | 0.79 |
| Current Ratio (MRQ) | 2.02 | 2.62 | 1.62 | 0.94 |
| LT Debt to Equity (MRQ) | 33.91 | 20.23 | 17.97 | 132.71 |
| Total Debt to Equity (MRQ) | 39.26 | 34.45 | 29.82 | 198.13 |
| Interest Coverage (TTM) | -26.05 | -1.66 | 0.18 | 42.78 |
Source: Reuters.com, SEC Filings.
Analyst Consensus
| Buy | Outperform | Hold | Underperform | Sell | No Opinion |
This is the consensus forecast amongst 32 polled investment analysts. Against the Motorola Inc company.
| Analyst Detail | Buy | Outperform | Hold | Underperform | Sell | No Opinion |
| Latest | 10 | 3 | 15 | 2 | 2 | 1 |
| 4 weeks ago | 10 | 4 | 14 | 2 | 2 | 1 |
| 2 months ago | 10 | 4 | 14 | 2 | 2 | 1 |
| 3 months ago | 11 | 4 | 13 | 2 | 2 | 1 |
| Last year | 4 | 3 | 17 | 2 | 3 | 1 |
Source: www.ft.com
Consensus Estimates Analysis
| # of Estimates | Mean | High | Low | 1 Year Ago | |
| SALES (in millions) | |||||
| Quarter Ending Jun-10 | 21 | 5,197.83 | 5,300.00 | 5,120.00 | 6,165.77 |
| Quarter Ending Sep-10 | 21 | 5,509.35 | 5,885.00 | 5,210.00 | 6,400.44 |
| Year Ending Dec-10 | 27 | 21,963.60 | 22,799.00 | 21,264.00 | 25,360.30 |
| Year Ending Dec-11 | 28 | 23,996.20 | 27,930.00 | 21,478.00 | 28,205.80 |
| EARNINGS (per share) | |||||
| Quarter Ending Jun-10 | 21 | 0.08 | 0.09 | 0.07 | 0.04 |
| Quarter Ending Sep-10 | 19 | 0.10 | 0.13 | 0.08 | 0.06 |
| Year Ending Dec-10 | 23 | 0.39 | 0.47 | 0.31 | 0.23 |
| Year Ending Dec-11 | 28 | 0.54 | 0.72 | 0.40 | 0.46 |
| LT Growth Rate (%) | 7 | 6.14 | 10.00 | 0.00 | 8.78 |
Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=MOT
Investment Highlights
Motorola (MOT) has been at the forefront of communication inventions and innovations for more than 80 years. Today, the Company’s portfolio of technologies, solutions and services includes wireless handsets, wireless accessories, digital entertainment devices, wireless access systems, voice and data communications systems, and enterprise mobility products.
With the rapid convergence of fixed and mobile broadband Internet and the growing demand for next-generation mobile communications products by people, businesses and governments, MOT is focused on high-quality, innovative products that meet the expanding needs of its customers around the world.
The Company operates in the following businesses:
• The Mobile Devices business designs, manufactures, sells and services wireless handsets, including smartphones, with integrated software and accessory products, and licenses intellectual property.
• The Home and Networks Mobility business designs, manufactures, sells, installs and services: digital video, Internet Protocol video and broadcast network interactive set-tops, end-to-end video distribution systems, broadband access infrastructure platforms, data and voice customer premise equipment, wireless and wireline cable and cellular broadband networks.
• The Enterprise Mobility Solutions business designs, manufactures, sells, installs and services analog and digital two-way radios, wireless LAN and security products, voice and data communications products and systems for private networks, wireless broadband systems and end-to-end enterprise mobility solutions.
In 2009, the Company reported sales of $22 billion.
Latest Developments
MOT’s Enterprise Mobility Solutions business recently announced two new managed services, the Managed Infrastructure Service and the Managed Device Service, to help IT organizations remove the complexities of managing multi-vendor wireless networks and devices, and help make mobility solutions accessible to more enterprise and government customers.
The Company’s new Managed Infrastructure Service combines the AirDefense Infrastructure Management and Network Assurance solutions to provide both large IT organizations and customers with limited IT resources with highly-available, remote monitoring, management and troubleshooting of their wireless LAN (WLAN). The new Managed Device Service leverages MOT’s industry-leading Mobility Services Platform to provide customers with around-the-clock management of wireless devices from multiple vendors, helping them meet service requirements and lower the total cost of ownership (TCO).
David Gagne, vice president of sales, MOT Enterprise Mobility Solutions, stated in a press release: “By selecting Motorola’s new wireless network and device management managed services, customers gain the confidence that their ecosystem is monitored by technicians with deep engineering and industry expertise, so they can focus on growing their business.”
MOT unveiled a plan Tuesday to modernize public safety agencies’ communications systems. The Company said its next generation of public safety solutions will maximize operational effectiveness by converging voice, image, data, and video communications from a multimedia, integrated command center and extend the reach of current mission critical communications networks. This will connect critical resources across agencies and jurisdictions, and between mission-critical two-way and broadband networks.
“With stronger networks and greater capabilities, public safety agencies can supplement voice with rich data and video content to empower first responders with the best information when and where it matters most to best serve and protect their communities,” the Company said in a statement.
Source: www.motorola.com
Technical Analysis
Source: http://stockcharts.com
MOT is below its 13-day moving average. This bearish sign is even more significant because the moving average is also trending lower.
MOT is trading within its Bollinger Bands. This is a normal condition and suggests that the stock is neither overbought nor oversold relative to the recent price action.
The MACD for MOT currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9-day moving average. Second, the MACD is below the critical level of zero, which implies that the underlying moving averages are trending lower.
Comparative Analysis
| Company Name | Ticker | Price per | Mrkt. Cap. | P/E | P/S | ||
| May-19-2010 | symbol | Share, $ | $ Mn | 2009 | 2010 | 2009 | 2010 |
| Cisco Systems Inc. | CSCO | 24.26 | 139,030 | n/a | 15.26 | n/a | 3.47 |
| Nokia Corp. (ADR) | NOK | 10.21 | 37,870 | n/a | 11.60 | n/a | 0.69 |
| Alcatel-Lucent (ADR) | ALU | 2.52 | 5,690 | n/a | n/a | n/a | 0.28 |
| Harris Corp. | HRS | 47.87 | 6,220 | n/a | 10.85 | n/a | 1.19 |
| Communication Equipment Industry Median | n/a | 21.13 | n/a | 1.22 | |||
| Motorola Inc. | MOT | 6.81 | 15,830 | n/a | 17.46 | n/a | 0.72 |
Source: Thomson Financial
Insider Trading Activity
| NET SHARES PURCHASE ACTIVITY
Inside Purchases – Last 6 Months |
||
| Shares | Transaction | |
| Purchases | n/a | 0 |
| Sales | 1,906 | 1 |
| Net Shares Purchased (Sold) | (1,906) | 1 |
| Total Insider Shares Held | 206.38M | n/a |
| % Net Shares Purchased (Sold) | 0.0% | n/a |
| Net Institutional Purchases — Prior Qtr to Latest Qtr | |
| Shares | |
| Net Shares Purchased (Sold) | 28,201,300 |
| % Change in Institutional Shares Held | 1.6% |
Source: Yahoo Finance
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