Tag Archives: CHL

The War Of 4G Long Term Evolution [Seeking Alpha]

Months after the announcement of Softbank’s (SFTBF.PK) $20B acquisition offer forSprint Nextel (S), the bidding war is heating up with Dish Network’s (DISH) $25.5B offering. DISH’s deal will form a unique combination of pay-TV and wireless if it goes through. Ultimately, however, it is the valuation proposition that will matter. The final winner should be the one that provides Sprint the most long-term value, which would be to allow Sprint to compete in the rapid developing 4G LTE market.

Run-Down

Below is a comparison table for the deals from Dish and Softbank:

Dish Network Softbank
Offering $25.5B $20.1B
Spectrum End/4G Sprint and Dish can combine spectrum rights While Japan’s Softbank and China’s China Mobile (CHL) are pushing TD-LTE forward, Sprint and Clearwire’s best 4G bet is to work with Softbank’s TD-LTE.
Edge Install antennas for wireless broadband Softbank has a stronger financial backing
Cost/Potential Reduce cost by combining call centers and back-end functions; could result in $11B of cost synergies, including a 3.3 percent reduction in expenses the first year. Clearwire’s 2.5GHz spectrum is uniquely positioned to be used as a global LTE band, provided a certain band configuration is used.
Penalty/Expected Completion Dish will pay for $600M penalty fee for Sprint to break up Softbank’s deal Expected to complete by mid-2013
Clearwire (CLWR) deal With Dish’s own $5.15B for Clearwire, Sprint buyout bid is not contingent on Clearwire part For Sprint, its own bid for Clearwire is contingent on the Softbank deal, as Sprint needs funding

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China Mobile: Stabilized 3G And Ready To Dominate 4G-LTE Market In China [Seeking Alpha]

China Mobile (CHL), currently has over 722 million subscribers and is accelerating its deployment of 4G TD-LTE in China. By working with Alcatel-Lucent (ALU), lightRadio Metro Radio will bring high-performance 4G services to Shanghai, Nanjing and Qingdao, three of the fastest growing cities in China. Alcatel-Lucent’s lightRadio portfolio of products will achieve the reduction of costs and power-consumption, as well as the size of LTE network elements, thus helping China Mobile to meet the growing demand for mobile video and data with increased speeds and performance.

Higher Network Capacity Achieved by Small Cells

While it was traditionally too difficult or too costly to deploy a macro cell base station in busy indoor and outdoor locations, lightRadio Metro Radio now provides a cost-effective alternative. This will alleviate the capacity problem for cellular networks as more subscribers use mobile devices to access high-bandwidth services. Small cells will enable China Mobile to provide high-quality, consistent services to customers without the need to build costly and logistically challenging cell towers.

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3 Large-Cap Stocks With Revenue Growth And Strong Free Cash Flow [Seeking Alpha]

The markets have been in a rally mode since the beginning of 2013. The S&P 500 closed above 1,500 for the first time in more than five years on January 25, 2013, as strong earnings continued to boost the index. Investors’ sentiment is very bullish, and the market is driven by extreme greed. Nonetheless, intelligent investors know that too much optimism may not be a good thing, as quoted from Warren Buffett, “Be fearful when everyone is greedy. Be greedy when everyone is fearful.” The central theme of this article is not to predict the market direction, but to review a list of high quality large-cap stocks that generate strong free cash flow while continuing to grow its revenue. So, when the tide turns, investors can still count on steady cash flows from these stocks with solid fundamentals.

Company Name (Ticker) Revenue, ttm Quarterly
Revenue Growth, ttm (yoy)
Levered Free Cash Flow, ttm Diluted
EPS
Forward Annual
Dividend Yield
Cisco Systems, Inc. (CSCO) $46.68B 5.50% $9.27B $1.55 2.60%
China Mobile Ltd. (CHL) $86.83B 6.60% $5.26B $4.97 3.50%
The Coca-Cola Company (KO) $47.60B 0.80% $6.42B $1.91 2.80%

Source: Yahoo Finance

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China Mobile’s TD-LTE Technology Expanding Fast, Where To Invest [Seeking Alpha]

China Mobile Ltd. (CHL), ranking as the largest mobile carrier in the world with over 722 million subscribers, had spent two years laying the groundwork for implementing TD-LTE, a 4G mobile phone standard developed by China Mobile for nationwide use. On January 23, 2013, China Mobile had revealed the company’s 2013 TD-LTE terminal development strategy. “We plan to adopt multi-mode, multi-band terminals, with basic terminals supporting 5 modes and 10 spectrum bands, and ideally supporting 5 modes and 12 bands. By 2014, we will require that terminals support Band 41,” explained Wang Hengjiang, director of the products division of China Mobile Terminal. China’s Ministry of Industry and Information Technology, MIIT, had recently allocated Band 41 (2500MHz – 2690MHz) for TD-LTE usage.

Schedule for TD-LTE Products and Handsets

For TD-LTE products, China Mobile will develop its customer-premises equipment and data card offering through a focus on Mi-Fi mobile hotspots. China Mobile will begin “friendly user” trials of LTE Mi-Fi and other related products in the first half of 2013. Mi-Fi trial products will be distributed in Q1 2013, and the service is expected to mature enough in Q2 2013 to begin commercial trial preparations. For TD-LTE mobile handset products, China Mobile will launch “friendly user” LTE handset trials in the second half of 2013. TD-LTE handsets will be distributed in Q3 2013, and a commercial trial will be prepared in Q4 2013.

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Clearwire Completes Sprint Nextel: A Great Buy With Reduced Risks [Seeking Alpha]

Sprint Nextel (S) is the third-largest carrier in the U.S., serving 48 million customers directly. The company offers wireless and wireline voice and data transmission services to subscribers in all 50 states, Puerto Rico, and the United States Virgin Islands under the Sprint corporate brand, which includes its retail brands of Sprint, Nextel, Boost Mobile, Virgin Mobile, and Assurance Wireless. Sprint Nextel is using two separate nationwide networks: code division multiple access, CDMA, and integrated Digital Enhanced Network, iDen. iDen network will shut down in 2013.

Reducing Risks with SoftBank Deal

Japan’s SoftBank’s $20 billion takeover of Sprint Nextel is the biggest-ever overseas acquisition by a Japanese company. The deal with SoftBank will provide strong capital to enhance Sprint’s financial flexibility while dramatically reducing Sprint shareholders’ risks. Sprint can move on quickly to regain its competitive edge and to expand its network and growth.

Clearwire Acquisition

Sprint may have overpaid for Nextel, but the deal with Clearwire is making a lot of sense and resolving a lot of past issues between Sprint and Clearwire. On Dec. 7, 2012, Sprint announced the agreement to acquire 50% stake in Clearwire Corporation (CLWR) it does not currently own for $2.97 per share. This transaction results in a total Clearwire enterprise value of approximately $10 billion, including net debt and spectrum lease obligations of $5.5 billion. As stated in the report, “Clearwire’s spectrum, when combined with Sprint’s, will provide Sprint with an enhanced spectrum portfolio that will strengthen its position and increase competitiveness in the U.S. wireless industry. Sprint’s Network Vision architecture should allow for better strategic alignment and the full utilization and integration of Clearwire’s complementary 2.5 GHz spectrum assets, while achieving operational efficiencies and improved service for customers as the spectrum and network is migrated to LTE standards.” The report also noted that the transaction is also contingent on the consummation of Sprint’s previously announced transaction with SoftBank. The Clearwire and Softbank transactions are expected to close mid-2013.

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China Mobile: A Solid Cash Flow Buy While The Company Marries Nokia And Continues To Court Apple [Seeking Alpha]

China Mobile Limited (CHL), founded in 1997, is an investment holding company, providing mobile telecommunications and related services through GSM networks. China Mobile ranks as the largest mobile carrier in the world with over 700 million subscribers. CHL is handicapped by using the less mature TD technology in 3G, which has forced the carrier to turn to lower-income rural areas for subscription growth. However, with its large scale efficiency and superior network coverage, CHL is a great investment target for cash flow for the long-term.

Network

China Mobile operates a GSM network, which covers all 31 provinces, autonomous regions, and directly administered municipalities in Mainland China, including Hong Kong. GPRS is utilized for data transmission. General Packet Radio Service, GPRS, is a service within the GSM network, just like the two most popular services SMS and voice connections. The company controls 70% of the Chinese mobile market but a far smaller percentage of the 3G market. As reported, “Even though China Mobile has 707.3 total wireless subscribers, making it the world’s largest carrier, the telecom has just 82.4 million 3G customers. China Mobile represents 64 percent of the total wireless subscribers in China, but only 37 percent of China’s 3G users – and its share shrunk from 41 percent of 3G users a year ago.” While China Mobile already has a relatively developed 4G “test” network, it cannot actually offer access to the network to subscribers in Mainland China until MIIT has issued it an operating permit, which now seems to be coming.

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