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The Zacks Analyst Blog Highlights:Nokia, Siemens, China Mobile, Telefonica and Hyatt Hotels
By: PR Newswire
Dec. 28, 2012 09:30 AM
CHICAGO, Dec. 28, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Nokia Corporation (NYSE:NOK), Siemens AG (NYSE:SI), China Mobile Ltd (NYSE:CHL), Telefonica S.A. (NYSE:TEF) and Hyatt Hotels Corporation (NYSE:H).
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Here are highlights from Thursday's Analyst Blog:
Nokia-Siemens Wins Successive Orders
Nokia Siemens Networks ('NSN') – a 50-50 joint venture between Nokia Corporation (NYSE:NOK) and Siemens AG (NYSE:SI) – has won two different network orders in quick succession from telecom giant China Mobile Ltd (NYSE:CHL) and Telefonica S.A. (NYSE:TEF). This successive order wining reflects the company's ability to serve diverse network needs of different customers.
Under the agreement, NSN will deploy China Mobile's Serve atOnce Intelligence customer and business network analysis tool in the Guangdong region of China. The new analysis tool will provide information regarding customer usage and preference. It is also expected to allow the largest telecom carrier in the world to increase customer loyalty and add new revenue streams.
In another agreement, NSN will upgrade the existing GSM and 3G network of O2 (Telefonica UK) with radio access network technology to provide LTE (Long Term Evolution) services across London and south east of England. The contract includes installation of NSN's NetAct network management system that will allow consolidated configuration, monitoring and network optimization across the network.
The leading telecom equipment manufacturer NSN has been going through a tough time for quite some time. Though the company has a strong GSM portfolio, it lacked severely on the CDMA front, which is the most dominant network used in the lucrative North American market.
In order to overcome this and reduce operating costs, the company is retrenching employees and selling its non-core business units. NSN plans to lay off 17,000 or 23% of its work force and expects the restructuring to result in an annual cost reduction of approximately $1.35 billion by 2013. The company has trimmed about 13,000 of its work force and has made five divestments, so far this year.
In the last two months, the company has won two network contracts from China Mobile and South Africa's Vodacom. Addition of these latest contracts will only consolidate its falling network business which has been subject to huge cash losses for quite some time.
Additionally, winning business in the mainland and pitting Chinese rival in their own backyard could be viewed as a positive for NSN, which has been facing tough competition from ZTE and Huawei technologies.
We retain our long-term Neutral recommendation on Nokia Corp. Also, it holds a Zacks #3 Rank, implying a short-term Hold rating.
Hyatt Strengthens in Asian Market
In a bid to expand in the lucrative Japanese market, Hyatt Hotels Corporation (NYSE:H) announced that it has agreed to open Andaz Tokyo, the first Andaz hotel in the region in collaboration with Mori Building Co., Ltd. The new five-star property is due to be opened in the summer of 2014.
Andaz Tokyo's location at Toranomon (Minato Ward of Tokyo) is a strategic one as it falls between Shiodome district and the Akasaka and Roppongi areas. Toranomon is considered to be an upcoming major business center hub of Japan. Tokyo Metropolitan Government considers it as a Special Zone for Asian Headquarters. Andaz Tokyo, with its basic and modern amenities, will aim to cater to the needs of the multinational companies situated in Toranomon. The hotel with 164-guest rooms and suites will also offer the luxury of spa and restaurant facilities.
Andaz is one of the leading brands of Hyatt Hotels and it is currently on a high growth trajectory. As of now, the company own nine hotels under the Andaz brand across four countries.
Apart from the new hotel, there are three other Hyatt-branded hotels in Tokyo and Hyatt already owns eight hotels in Japan. The company has already opened a five-star hotel, Grand Hyatt Tokyo in Japan in association with Mori Building affiliates.
On December 12, Hyatt Hotels had announced the debut of a Hyatt Place branded hotel in Bangkok in collaboration with local real estate firm Pioneer Property Company Limited (PPC). The new property - Hyatt Place Bangkok, Sukhumvit, is slated to open for business in 2017. Now, the launch of Andaz Tokyo will further strengthen the company's position in the growing Asian market.
We presently have a long-term Neutral recommendation on the company's stock. However, the company carries a Zacks #4 Rank (short-term Sell rating).
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