The recovery in US markets yesterday was good for beaten
down wireless telecom stocks. Add to this, the chances of a short selling ban
in Europe spurred a recovery in the continent that could guide the US markets
in the green for a second straight day. Clearwire
CLWR), FiberTower Corporation (NASDAQ: FTWR)
and Globalstar Inc (NASDAQ: GSAT)
are some stocks looking good valuation wise after the recent battering.
CLWR) is the dark horse of the wireless communications industry and could
eventually emerge as a big time winner if it manages its debt concerns. The
stock came under $2 mark last week as the quarterly numbers took a beating amid
wider losses. Hopefully, the newly appointed chief executive EriK Prusch can
lead the company out of the debt trap. Meanwhile, the 51 per cent drop over the
last month was accompanied with higher volumes at every selling spree
indicating an oversold situation in the stock. The 14 day RSI of 26.9 also validates
an oversold position which means there could be a rebound in the coming days. Even
after yesterday’s jump of 10 per cent, the stock looks good for further
FTWR) recovered 5 per cent yesterday moving along with the broader
markets. However, overall returns in the previous month stood at 48 per cent in
the negative territory. The second quarter results announced last week were not
particularly encouraging putting some pressure on the stock. However, the company
has a strong footing in its business and serves 6 of the top 8 wireless
carriers in the US. At a current price of 71 cents, the stock is pretty near to
its 52 week low of 64 cents and a long way from its year high of $4.82. Its
asset heavy business model means that the company has a relatively higher book
value of $6.1 per share which clearly tells the stock price is undervalued.
Globalstar Inc (NASDAQ: GSAT)
provides mobile voice and data communication services via satellite. The stock
is a perfect case of good businesses going far too cheap nowadays. True, the poor
quarterly result was a major reason behind the stock’s fall last week; however,
the negative treatment mated out to the stock seems to be a little overdone.
The positive development of completing a $38 million private placement got
completely lost somewhere in the mayhem. However, when the markets recover, it
will be one of the first stocks to rebound.