WorldCom won the bidding war for MCI in late-1997 ("WorldCom's $37-Billion Bid Persuades MCI Board" 1997). At that time, the deal was the largest corporate acquisition-merger in history. Since that time, the magnitude of the acquisition-merger has been topped at least twice.
Over the past year, the new MCI WorldCom has been busy redefining itself, establishing market positions for the future, and working its way through the final processes of regulatory approval in both North America and Western Europe (Schmelling, 1998). The common stock for the post acquisition-merger company trades on NASDAQ under the name MCI WorldCom, Inc. under the stock symbol "WCOM."
This research analyzes the common stock performance of MCI WorldCom. This analysis reflects the past and present performance of the stock, as well as reviewing the potential for the future performance of the stock.
Immediately following the acquisition-merger in December 1997, the MCI WorldCom common stock traded at a share price of $33. Over the past 12 months, the market has vacillated, however, the general trend has been upward, with a closing share price on 2 December 1998 of $61.625. A graphic portrayal of the market performance of the MCI WorldCom common stock over the past year is presented in Chart 1, which may be found on the following page.
MCI WorldCom Common Stock Market Performance: 1 December 1997- 2 December 1998
[Source: America Online Investment Research, 1998]
As the data reflected in Chart 1 indicate, the company's common stock has performed well in the year that has elapsed since the acquisition-merger in December 1997. The market share price has increased 86.6 percent since December 1997.
The common stock of MCI WorldCom also has performed well in the present, which for purposes of this research is defined as the past 30 says·2 November 1998 through 2 December 1998. The low-bid price data for the MCI WorldCom common stock on each t...