TLS - Telstra Corporation

[nulla nulla]

After a sporadic 3 days where tls looked like it was going to stick to last weeks script, tls took off after todays open and turned over a quick 10 million or so as it pushed up to $2.87. And then it stopped.

I have two small sell parcels sitting in queue at $2.87 (within the first 500k shares) and wasn't impressed when the sellers came out of the woodwork, well and trully putting the brakes on.

Back to the $2.84 - $2.85 and struggled there after to make any impression on $2.85 before the end of day auction.

To my untrained eye tls really looks like it is trying to break out above $2.85. Maybe next week?

 

[alexandro]

The characteristics of TLS have changed since its visit to 2.57 recently and the announcement that future fund holding was now down under 5%. It has become stronger and less of a dog. A tinge of bullishness.

It’s taking a long breather after a decent recovery from 2.57 but time is running out and it has to decide soon, up or down. It should go to at least to 2.94 for a start then test 3 again. That way it would have filled the trading gap between 2.94 to 2.81 created in February when it went ex-dividend. But the last few days trade where it added 1c per day from 2.83 to 84 to 85 was more that the All Ords tide was lifting all boats than any TLS strength action. Like a shy girl not quite ready, it did it but reluctantly and not yet convincingly. The desire must be stronger. What we need is a day soon where it closes up by at least 3-4c on volume above 60mil and a close above 2.85-86.

If you do a monthly candlestick plot of TLS you can see that TLS has gained nothing the past 5 months. The gains were only intra-month if any (up, then down). So there hasn’t been a month for a long time where it has closed higher than it has opened the month. I am betting April is going to be a month where this happens. It opened April at 2.82 and by the time April trading days are over, it should close higher than 2.82. And I’m betting there will be months ahead where gains are posted. TLS opened the year at 2.80 and will close the year higher than that to post the first positive year in a while. It must happen. We are not far from the year open now 2.80 vs. 2.85, so according to my theory, TLS has a lot of gaining to do and upside up to December 31st. I’m thinking this stock is on its way to 3.25.

Frank D's insights have been useful, although sometimes wrong way around or out by timing, his posts contained many elements that played out. If you’re out there Frank D and got a few moments.....let’s hear your analysis.

Happy Easter

 

[nulla nulla]

The fairfax article has received mention in the NBN thread.

http://www.theaustralian.com.au/bus...holesale-pricing/story-e6frg8zx-1226044176709

If the monthly cost for the minor telco's to cherry pick City copper lines increases from $6 per month to $16.00 this would have to impact profitably on the tls bottom line for such time as it takes for NBN to roll out and telco customers to be migrated (if ever).

Be interesting to see if tls has to put out a revenue/profit forescast upgrade.

 

[ROE]

The fairfax article has received mention in the NBN thread.

http://www.theaustralian.com.au/bus...holesale-pricing/story-e6frg8zx-1226044176709

If the monthly cost for the minor telco's to cherry pick City copper lines increases from $6 per month to $16.00 this would have to impact profitably on the tls bottom line for such time as it takes for NBN to roll out and telco customers to be migrated (if ever).

Be interesting to see if tls has to put out a revenue/profit forescast upgrade.

not until after May please

My covered call strike price 2.90 is getting mighty close and i want it expire worthless before any good news come out

from now till end of May if TLS trade between 2.80 and 2.90 I double bag this month options ...both PUT and CALL expire worthless

 

[nulla nulla]

To my untrained eye tls really looks like it is trying to break out above $2.85. Maybe next week?

Nice to get one right. Only took the news of the AFL Internet Streaming rights to provide the spark to launch tls up past the $2.86 barrier.

The spurt with volume before the close to $2.91 and holding at $2.91 in the auction looks promising for next week.

 

[BrightGreenGlow]

Nice to get one right. Only took the news of the AFL Internet Streaming rights to provide the spark to launch tls up past the $2.86 barrier.

The spurt with volume before the close to $2.91 and holding at $2.91 in the auction looks promising for next week.

That helped it for sure nulla, without any bad news TLS should really be gaining 1-2secs a week in anticipation of the NBN..baring all things go as planned. Not necessarily on time but to plan. PS: I hope ur right about next week.

 

[BrightGreenGlow]

Will be hoping its before Novemember (the NBN vote) however I won't mind waiting until then...

http://www.theaustralian.com.au/bus...faces-long-delay/story-e6frg8zx-1226047202643

 

[drsmith]

Will be hoping its before Novemember (the NBN vote) however I won't mind waiting until then...

What year ?

The current ALP government might be toast by then.

 

[BrightGreenGlow]

this year i hope x 2 smith.....

we are already half way to the next bit of franked money....

 

[alexandro]

I think TLS has huge upside from here. This is just the start. It is 3.40 within 6 months then back into the $4's in 18 months. The trend is our friend.

 

[Boggo]

I would think their shareprice will head up to $3.40 again quite quickly.

I think TLS has huge upside from here. This is just the start. It is 3.40 within 6 months then back into the $4's in 18 months. The trend is our friend.

The first post above was made on 8th of September, it hast gained 10c since then and now we have a target of another 6 months

alexandro, can you show some analysis/qualification/information to substantiate that bold statement or is it just wishful thinking ?

 

[nulla nulla]

Seems to have broken away from the $2.80 - $2.85 range and is now trying to work higher. The recent news has been good regarding mobile market share gains at the expense of vodaphone. NBN appears to be slowly moving toward a positive outcome for telstra.

The overhang from the future fund is probably still being pushed into the market. I would not be surprised to see tls move to the $3.00 - $3.10 range before the end of fiscal year as the future funds completes their exit. At the same time the NBN volatility could push the price back down. I like the chart.

 

[alexandro]

Analysis/qualification/information 1.

It appears that an important trend is taking place - the double bottom reversal.
•Is there a prior trend to reverse - yes, the magnificent TLS down trend of all time.
•Has the down trend line been broken-yes.
•Are the two bottoms at about the same price level – yes (within 3%).
•Have the two bottoms formed in the text book time frame of 1-3 months – yes (4 in this case).
•The breakout point is at $2.99. The bottoms have occurred at 2.55 and 2.57 (call it 2.57). The distance between the breakout point and the levels at which the bottoms have taken place is 2.99-2.57=42cents. The potential target becomes 2.99+0.42=$3.41.

TLS arrived at the breakout point of 2.99 on Friday. This level is psychologically important as it is the February high and 3.00 is psychologically important for obvious reasons. So it is natural for it to stall here. Thats it and enough on charts. What is more is that fundamentals are also good at this time and there are good developments on the way to support the double bottom reversal.

NBN deal sign off and removal of uncertainty. Completion of the Future Fund sell. Re-weighting of the stock up to 3% on the AllOrds. Significant increase in mobile customer numbers. If interest rates go down, TLS’s rate will look even more attractive. Successful bid and award of wireless spectrum.

There could even be an upward revision to profits (that would really do it and is likely).

Analysis/qualification/information 2.

TLS was tracking with the AllOrds during the financial crisis and even outperformed owing to its defensive nature at the time. The deviation began in August 2009 where the future fund did its first off-load. Then, profit downgrades, NBN issues and further Future Fund on-market sell offs made it worse and the gap between the AllOrds and TLS widened. Last November, when the gap got too wide (about 25%), TLS bounced and did some bridging of the gap. The gap currently stands at about 20%, again very wide. On the 10 years chart, the gap stands at 100%. The last time the gap was 100% was late 2006 where TLS rose from a low of 3.43 to 4.96 (45%) in a space of 7.5 months. An effort was made to close the gap, but the credit driven and artificial rise of the AllOrds was too strong and the gap widened. In the crisis, the AllOrds broke down and helped bridge the gap afterwards. The gap again widened when TLS didn’t participate in the 2009 recovery. I believe conditions are shaping up and fundamentals are there now for this gap to close further to more normal levels (I’m not saying all the way, but the probability is high). That is also why the double bottom reversal and 3.40 target makes sense. It all fits in. TLS’s PE ratio of 11.75 is also low and has room to move up to 12 or even 13.

 

[Boggo]

Excellent alexandro, good summation.

TLS is not my kind of stock but its refreshing to see someone associate some fundamental potential and pattern analysis.

Its triggered my weekly system again but on past occasions it rebounded off the line and created a shorting opportunity on the daily chart.

(click to expand)

 

[alexandro]

Here are charts again

 

[McCoy Pauley]

Looks like that $2.99/share is a resistance level. Down to $2.93/share today. This week will be pivotal, IMO, to working out the near-term share price of TLS.

 

[nulla nulla]

Looks like that $2.99/share is a resistance level. Down to $2.93/share today. This week will be pivotal, IMO, to working out the near-term share price of TLS.

Possibly a bit of profit taking given the open of $2.99. Anyone projecting a re-entry point?

 

[nulla nulla]

A solid week finishing on $2.98 after tapping $3.00 in interday trading on Friday. The chart has all the appearance of a share trying to break out upwards (in my opinion).

Next week could see a repeat of a recent entry exit pattern with trading between $2.98 and $3.03 (as holders lock in their profits and fresh buyers jump on looking for the rises into the low $3.00's).

At least the Future Fund has lost some of it's ability to push/hold the price down with it's policy of dumping large volumes of shares every time the share price looked like climbing.

 

[alexandro]

Closing of the gap between the AllOrds and TLS performance progressed further this week (compared to last post 3yr chart) as AllOrds went down and TLS held steady (up 1 cent). TLS needs a close above 2.98 into 3's on very high volume (in a very convincing way). Australian and world markets not looking good (weak), thats not going to help. So in the short term, the force that propels TLS over the line doesn't look like it will come from there. It will have to be TLS specific news that does it.

 

[alexandro]

She has traded at 3 again but not convincingly. Volume too light at 27mil. Needs to punch through 3 harder.