Goodbye Moto - Top Stocks Blog - MSN Money
 
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Goodbye Moto

Posted Nov 20 2007, 02:32 PM by Robert Walberg
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Like the song says, "some say love is a Razr that leaves your soul to bleed." Well, my soul has bled waiting for Motorola's stock to turn around.  I can't wait any longer -- I'm not Job, after all.

Motorola has been screwing up for so long, it even gets it wrong when it gets it right. Last quarter the company delivered another lousy set of sales and earnings numbers, yet it guided fiscal fourth-quarter earnings to a range of 13 to 14 cents a share -- a few pennies above The Street's consensus.  Normally, guiding estimates higher would be perceived as a good thing, and it was at first as the stock edged higher on the news.  However, in offering up hope for the fourth quarter and the upcoming year, CEO Ed Zander might have won himself a new contract. And that's bad news.  

You see one of the reasons I bought Motorola's stock down at its lows was in anticipation of a new management team.  Typically when a struggling company finally ousts its old CEO in favor of someone new and full of promise, the underlying stock tends to rally. Until recently, Zander's ouster was all but certain. But in light of the company's modest progress off a terrible set of numbers, Zander might just hang around.  Let's face it, he did take all the credit for the Razr so there might be a board member or two who thinks he's on the verge of another one-hit wonder. [readmore]

I don't know if the new CEO would be Motorola's own Greg Brown (current President and COO) or an outsider like former Qwest CEO Dick Notebaert and frankly I don't much care -- it's just at the point where anyone but Zander will do.  Isn't there a young Galvin kid somewhere looking to reestablish the family name? 

Without a change at the top, Motorola's stock will be stuck at the bottom.  It was the one big catalyst we needed for the stock to make a run back into the low $20s.  The Razr2 sure as heck isn't the answer to our turnaround prayers. Granted sales have been a little better than expected, but the price is still too high, the functionality is hit -or-miss and the design has lost its cool factor.  And don't even get me started on the Q.  Motorola's answer to the smart phone craze was put to shame by Apple's iPhone and Research-in-Motion's BlackBerry Pearl.  Motorola can't give the phone away -- though it has tried hard, which helps to explain the company's declining margins.

So after waiting and waiting, I wait no more.  Goodbye Moto.

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Comments

 

mY MOTOROLA RAZR REALLY SUCK AFTER A YEAR AND A HALF THE SCREEN WENT BLACK AND THE SPEAKER GONE TOO AND TOO MUCH TO FIX . i AM GOING TO ANOTHER BRAND BECAUSE I AM VERY DISSAPOINTED IN THEM.

you may be right on the CEO leader of the company and management changes that would boost the stock but you could not be more wrong about the Q.  I've seen the RIM pearl and the iphone too...they're great but they don't have great software.  Windows Mobile 6.0 connected to enterprise mail is far superior to either of the competitors you mention.  The Q is unbelievably functionable, sleep design with unbelievable software that is for a business person...not a casual i-podster or crackberry bigot.  Its hardware and software working together.  Hello Motto....teaming with $60B Microsoft is your best bet.  keep the wagon hitched!

To Quote "Dave"

"How can Motorola have such lousy stock when they have just about 100% of the public safety 800 mhz systems in the country and a lock on most other public safety systems as well. Their new canopy system for wireless rocks. Maybe they just have great techs but lousy accountants."

I can answer that question. While they are still #1 in the public saftey sector, they are rapidly losing market share. M/A-COM (Now Tyco Electronics) has been making large strides in public saftey infastructure and I believe will overtake Motorola in the next 5 years.

The president of Wireless Systems (Public Saftey communicaitons) is a former Executive of Moto.

Manufacturing going overseas has nothing to do with government and everything to do with greedy unions.  Come on folks.  Mindless assembly line labor is minimum wage stuff but the unions want it to be six digits and less work.  If you put on the same lug nut all day every day, that is minimum wage.  The US companies have rolled over for the unions too much.  Now to offset excessive labor costs, we make our cars and other products out of cheap plastics.  We produce garbage and don't honor our warranties.  Jobs go overseas because they pay the labor what it is WORTH...minimum wage.  I refuse to buy American union made products because of that. Unions should be outlawed.  Quit whining about overseas jobs and the government.  Improve yourself through education and hard work and you won't need a union.

JAMES DUCKWORTH above(Posted 11.20.07 3:51 PM) said it all.

ref: "Goodbye Moto" article written by Robert Walberg.  I guess, it is only a

short time that his "services" (if you could call that) will be replaced by persons

in Asia.  But by then we may not be able to pay for internet connections,

anyway. As "Americans" do not buy services and products provided by Americans,

as "those are not good enough". What makes that whatever you do good & cheap enough? If we all buy Samsung, Nokia, Sony-Emerson, etc. where and how would Motorola get money for developing new and better products???? Explain!

What are you talking about James? You didn't make one solid point and your comment has nothing to due with the subject at hand! I too bought Motorola on the hopes of a management change, or even a breakup. Just waiting for my one chance to get out on a slight up-swing; if it's even possible.

When Motorola sold there automotive divsion I knew they sold there heritage. Since they are no longer in the automotive bussniess its time to change there name to more closely match there current wok Cell-u-olla (sell-u-ova).

Since the sale of that division the Germans that bought it are shutting down the factory and outsourcing and im outta work . . . . .

At least Motorola's bottom line looked good for one quarter . . . . .

I worked for Mot in the 70's in their plant in Plantation Fl. My family worked there also we are all gone from there.Mot is not the company they we're back then.Their stocks show it."They just got to big for their their britches".That's what happens with all these Companies.LIke Lowe's,Like HD and not to mention others.There is no loyalty....

MOTO is the only phone manufacture that moved it's production back to America ....one reason we trying put them down......or is it, that they invented the flip phone with the microtec, when all the other cell phone makers was still building bricks....your market info might be close to right.....but your technology info is so far off it is a LIE

I apologize for my second comment today (and for the year, too). I asked, basically: if other American's product is not good enough for you, what makes you think that your services and products are good enough for other Americans? What makes you so special? After, I read other comments faulting Motorola (the pioneer in cell phones) that there are not enough functions built into their phones. To that I say: My personal view of people walking on the street, in the stores, etc., icessantly talking on the phone; or text messaging, making and sending pictures, accessing internet - that these people are basically braindeads. If I have something to say or ask, I call.  For pictures I have a good digital camera (Kodak, as you guessed); for Internet, I have desktops and laptops (certainly beat the 2" screen). Even for important business communication, calls are faster and provide for conversation, instant response, exchange. On the airplane you cannot receive or send calls or text massages anyway – all other locations calls will work. In other words, it seems that the phones are used for playing by many - teenagers may have spare time for such (does not speak much for their social skills and yearning to learn).  But for everybody else, those play uses are really a waste of time, brain and the chance to do more challenging and rewarding things. Add to this the excessive time spent on computer gaming (an epidemic) and you have the making of braindead, ignorant adults –a sad outlook for their future contribution to our society.

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