LVLT

[brker_guy]

Interesting news from LVLT today:

 

http://lvlt.client.shareholder.com/secfiling.cfm?filingID=794323-09-97

 

A 20yrs contract...  I wonder with whom...

[Parsad]

Most likely Sprint.  They were working on some sort of deal with Sprint for their long-haul service.  Funny, we never owned any LVLT over the last ten years...not even the debt.  We loaded up on a ton of call options when it was in the 60-70 cent range, and now we are really starting to get interested on what could happen with this business.  

 

Sam Mitchell a couple of years ago at our FFH dinner, responded to our question of how long it would take LVLT to hit critical mass.  Many of us thought it was several years away, and he said that he believed it was a couple of years away.  I think he may have been correct.  I can really see LVLT's margins increasing over the next five years.  This will be very interesting to watch as they have so much debt.  Fortunately for them that their equity and debt holders are such a tight knit group and will continue to support them.  

 

One of our fund partners has quite a bit of his net worth in LVLT.  I think the tides are now slowly changing, and his patience may finally get a respite from all the pummelling this stock has taken over the years.  Cheers!

[Guest longinvestor]

Been with LVLT equity since 2002 and have posted about the changing tide on the MSN-BRK board in the last year or two. Obviously, I have not made a dime on this so far but this has been a very instructive period. While it is rather easy to see all the negatives with owning the stock(actually this is one of the most hated stocks out there), the flip side if the story ends well would be the ultimate accumulation possibility one has had. Is ten years a long time, sure! But if the promise of increasing margins comes true, this would be a deep value story right out of the value investing book. We all know Prem has a large stake in LVLT. FFH and SEAM own half the company. The wisdom of ignoring media/headlines/analysts et al is particularly true with the LVLT of the last two years & as (ironically) during 1999-2001 when they pumped this to $132.

 

The virtue of patience will have been truly tested.

[Guest longinvestor]

http://finance.yahoo.com/news/Level-3-Signs-Debt-Exchange-prnews-1787870206.html?x=0&.v=1

 

The runway has been extended for LVLT. If you have followed the story for the past 7-8 years, extending is winning. After all, 100-year monopolies don't unwind any faster. We are witnessing the gradual unwinding of the Bell legacy. Good to see Prem and SEAM are financing this runway extension.