GO
Loading...

Options: Dim View of Motorola Handset Split

What does the option market think about Motorola's move to split off its handset business? Not much, according to one expert.

"There are a few ways of looking at this Motorola decision to split into two companies," Rebecca Darst of Interactive Brokers said on CNBC's "Squawk Box" Thursday morning. "First, the very optimistic view that even if Motorola is successful in finding a new CEO, finding a new handset strategy, getting on track, something that could take up to one to two years, it still may enhance the value for shareholders. That's pretty optimistic.

"The second school of thought would hold that this one-to-two year distraction could be good for the likes of Samsung, Nokia and Ericsson, which have been struggling lately. That's maybe a little more realistic, but then the third school of thinking would hold that this is a very ominous move in general."

Some believe Motorola's move will only put more pressure on the traditional handset sector, which is already facing stiff competition from smart phones.

"If you were to take a snapshot of the option action yesterday in Nokia , Ericsson , and Motorola , it would most closely mirror the sort of third way of thinking," she said.

More Motorola: Is Break-Up the Right Move and Icahn Wants More.

Symbol
Price
 
Change
%Change
NOK
---

Featured

Contact Technology

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More

Squawk Alley