CNU - Chorus

[klid]

Can't tell you how glad I am to be out of this one.

But but but!! On the other hand, I see this stock as BUY.
Does anyone agree? I see everything (bad) is out in the air now. Things could get a lot better but not worse to the same extent?

[silu]

But but but!! On the other hand, I see this stock as BUY.
Does anyone agree? I see everything (bad) is out in the air now. Things could get a lot better but not worse to the same extent?

Didn't say it wasn't worth buying. Great liquidity for short term trading for sure. I sold everything at $2.05.

[couta1]

But but but!! On the other hand, I see this stock as BUY.
Does anyone agree? I see everything (bad) is out in the air now. Things could get a lot better but not worse to the same extent?

One word klid CAUTION no one on here knows exactly where this stock will end up just when everyone thought it couldn't get any worse it just did, maybe its worth a quick trade for some or a long term play like Milford but there's a lot better places to put your money at the moment.

[Poet]

So Peter Dunne back as a minister today

Watch out for the quid pro quo

[Harvey Specter]

So Peter Dunne back as a minister today

Watch out for the quid pro quo

His electorate moved up the roll out timetable.
He supports a delay to comcom implementation.

[couta1]

Will be interesting to see if S&P downgrade chorus to BBB minus putting it below investment grade quality?

[mrjeems]

This downgrade wasnt unforseen - it just happened sooner than Chorus was expecting. I guess MOST of the bad news is out now but I'm waiting to hear whats happening around their dividends and results from discussions with CFH etc before putting money in.

[Harvey Specter]

This downgrade wasnt unforseen - it just happened sooner than Chorus was expecting. I guess MOST of the bad news is out now but I'm waiting to hear whats happening around their dividends and results from discussions with CFH etc before putting money in.

Considering the John Key "Could go Broke" quote, completely foreseen. It was just a matter of timing.

CNU Treasury would have been working overtime trying to get any change delayed until they had put out their plan on how they will deal with ComCom recommendation and also talking up their change of success in the court action with the ComCom.

Who trusts rating agencies anyway.

[USbasedInvestor]

I am a US based individual investor who many years ago bought a small position in Telecom New Zealand. I sold a chunk of my Chorus shares on November 5^th on the news, and the remainder at significantly lower prices to take a tax loss.

I just discovered this board, and will share my perspective on Chorus and hope you can provide me with some insights, as I will continue to follow Chorus should an investment opportunity arise.

Given the pricing decision, Chorus will have a substantial cash shortfall. As a result, Chorus must eliminate the dividend and make cost and service cuts. Even then Chorus will have a substantial cash shortfall. Unless the fibre rollout is to be stopped or delayed significantly (and nobody is talking about that), Chorus will have to come up with cash somewhere.

Politics appear to prevent overriding the pricing decision, absent a two year long review. Therefore, Chorus has to get the needed cash from: the government, increased debt, or issuing new shares.

From what I have read, the government is not willing to provide additional funding (politics, again). Crown Fibre Holdings has to live within its budget, and (I am not positive on this point) it does not appear they have the budget to just fund the Chorus shortfall. Chorus cannot issue debt to fund the shortfall because they will be too highly leveraged (debt was downgraded today and a negative outlook remains). That leaves only a new share issuance.

The problem with issuing shares is that 1) the stock has no dividend, making it less attractive. 2) if a dividend is maintained at a reasonable level (say 1/3 of the previous dividend), then the cash shortfall is that much greater and the issue must be larger. 3) The cash needed is large relative to Chorus’ market capitalization.

A stock issuance is unlikely without a dividend, and even with a dividend would be so large that the funds could only be raised at prices well below what Chorus has been trading at.

Why does Chorus not talk about delaying or stopping the fiber rollout to live within funds available, at least until the pricing review is done?

How are the politics likely to play out? Is one political party likely to cross over and agree to override the pricing decision, and if so, when would that likely be, given New Zealand’s election cycle?

I have seen a few folks post that all the bad news is out, or priced in or such. This is not just news - it is a serious cash shortfall that must be met, or plans changed a lot. Figuring out how the cash shortfall will be resolved is (to me) key to understanding where Chorus will trade, and when.

Do I have a good understanding of the situation Chorus is in?

Thanks for any help, and feel free to ask me any questions.

[BIRMANBOY]

Hi there, you have stated many of the issues that surround this share. There is so much uncertainty with this situation that trying to come to grips with what could /may happen is akin to arm wrestling an octopus in my opinion. Its a unique and unbelievably complex environment and I think a lot of investors have either abandoned ship or shoved their shares in the drawer (me for one). All will be revealed in time and until then its only fit for pirates and steel testicled traders. The long term premise is sound its just what will it look like when all the political and financial BS has been disclosed. Could be a year or longer...who knows.

I am a US based individual investor who many years ago bought a small position in Telecom New Zealand. I sold a chunk of my Chorus shares on November 5^th on the news, and the remainder at significantly lower prices to take a tax loss.

I just discovered this board, and will share my perspective on Chorus and hope you can provide me with some insights, as I will continue to follow Chorus should an investment opportunity arise.

Given the pricing decision, Chorus will have a substantial cash shortfall. As a result, Chorus must eliminate the dividend and make cost and service cuts. Even then Chorus will have a substantial cash shortfall. Unless the fibre rollout is to be stopped or delayed significantly (and nobody is talking about that), Chorus will have to come up with cash somewhere.

Politics appear to prevent overriding the pricing decision, absent a two year long review. Therefore, Chorus has to get the needed cash from: the government, increased debt, or issuing new shares.

From what I have read, the government is not willing to provide additional funding (politics, again). Crown Fibre Holdings has to live within its budget, and (I am not positive on this point) it does not appear they have the budget to just fund the Chorus shortfall. Chorus cannot issue debt to fund the shortfall because they will be too highly leveraged (debt was downgraded today and a negative outlook remains). That leaves only a new share issuance.

The problem with issuing shares is that 1) the stock has no dividend, making it less attractive. 2) if a dividend is maintained at a reasonable level (say 1/3 of the previous dividend), then the cash shortfall is that much greater and the issue must be larger. 3) The cash needed is large relative to Chorus’ market capitalization.

A stock issuance is unlikely without a dividend, and even with a dividend would be so large that the funds could only be raised at prices well below what Chorus has been trading at.

Why does Chorus not talk about delaying or stopping the fiber rollout to live within funds available, at least until the pricing review is done?

How are the politics likely to play out? Is one political party likely to cross over and agree to override the pricing decision, and if so, when would that likely be, given New Zealand’s election cycle?

I have seen a few folks post that all the bad news is out, or priced in or such. This is not just news - it is a serious cash shortfall that must be met, or plans changed a lot. Figuring out how the cash shortfall will be resolved is (to me) key to understanding where Chorus will trade, and when.

Do I have a good understanding of the situation Chorus is in?

Thanks for any help, and feel free to ask me any questions.