The Zacks Analyst Blog Highlights: AT&T, Apple, Akamai Technologies, Limelight
Networks and General Motors
CHICAGO, March 26, 2013
CHICAGO, March 26, 2013 /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 AT&T, Inc. (NYSE:T), Apple Inc.
(Nasdaq:AAPL), Akamai Technologies, Inc. (Nasdaq:AKAM), Limelight Networks,
Inc. (Nasdaq:LLNW) and General Motors Company (NYSE:GM).
Get the most recent insight from Zacks Equity Research with the free Profit
from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Monday's Analyst Blog:
AT&T Charged $27.5M in Patent Suit
AT&T, Inc. (NYSE:T) faces charges of $27.5 million under a patent lawsuit
filed by Colorado-based Two-Way Media LLC. We believe that the regulatory
charges would remain a headwind for the company, which already remains exposed
to heavy expenses on network deployment and subsidies over high-end
smartphones like Apple Inc. (Nasdaq:AAPL) iPhone and Android-based
smartphones. However, according to news reports, AT&T plans to move against
this verdict and challenge the fine amount imposed by the federal jury in San
AT&T's legal battle with Two-Way Media has been ongoing since 2008 when the
latter filed a patent infringement case against Akamai Technologies, Inc.
(Nasdaq:AKAM) and Limelight Networks, Inc. (Nasdaq:LLNW) as well as AT&T.
Two-Way Media had five patents pertaining to live streaming technology applied
in Internet broadcasting, which were violated by these companies. Two-Way
Media has reportedly settled its disputes with the other companies. However,
its legal battle with AT&T continues to exist, as the latter's U-verse
services allegedly infringed two patents of Two-Way Media.
We believe AT&T's domestic operations are subject to regulations by the
Federal Communications Commission (FCC) and other federal, state and local
agencies. These regulatory regimes frequently restrict the company's ability
to provide certain products or services in designated areas.
In addition, the loss of certain licenses due to infringement and other
disputes could have a material effect on the wireless business of the company.
In addition, the development of new technologies, such as Internet
Protocol-based services, including VoIP and super high-speed broadband and
video, could be subject to conflicting regulations between the FCC and various
state and local authorities. Such restrictive and conflicting regulations
could significantly increase the cost of implementing and introducing new
services that aid future developments.
AT&T has a Zacks Rank #3, implying a Hold rating.
GM to Close Opel Plant Earlier
Bad news for Opel: employees at the luxury car making unit owned by General
Motors Company (NYSE:GM) have rejected its turnaround deal to save the
struggling European unit. The failure of the deal means that the plant will be
closed down by 2014 instead of 2016, significantly adding to the surging
unemployment in Europe as the Bochum factory employs more than 3,000 workers.
Opel had initially intended to keep the plant in operation till 2016 and
retain 1,200 of the more than 3,000 employees in other component and
warehousing jobs. The company wanted workers at the plant to accept delay in
wage increases. But about 76% of employees at the plant voted against the
The Bochum plant manufactures Zafira compact multi purpose vehicle (MPV). Opel
management started discussion with German employees in June last year to reach
a resolution that would guarantee significant savings and flexibility to the
company. Opel operates three more plants in Germany.
Late December, Opel announced plans to sell six facilities in Europe to GM in
order to win extended funding. The transaction includes an engine plant in
Hungary, a development center in Turin, Italy, and a facility in Gliwice,
Poland. The decision will help the Ruesselsheim, Germany-based automaker
receive funding till 2016. Opel is obligated to pay back a loan to General
Motors by 2014.
Late 2012, Opel had also announced to cut its administrative workforce by 30%
or 1,000 jobs at its Ruesselsheim headquarters in Germany as part of GM's
10-year plan "Drive Opel 2022" that include reduction in personnel costs. Opel
had already shut down two plants in Britain, located in Ellesmere Port and
Luton. The move had idled 3,000 workers at the plants.
Opel faces weak car sales, high fixed costs and an excess production capacity.
These resulted in a total loss of more than $17.3 billion since 1999 due to
uncompetitive models and weakening European market. Therefore, the company's
turnaround plan incorporated cost reduction measures, new model launches and
efforts to boost export sales.
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