Here is turnaround companys that I like:
OMNIPOINT CORP (OMPT)
9 STRONG BUYS
1 MODERATE BUY
1 HOLD
I did get some of Robertson Stephens report and I will post it below for all of you, Good luck, Joe
OMPT: INITIATING COVERAGE OF OMNIPOINT CORPORATION WITH A BUY
KEY POINTS:
ú Omnipoint is the fourth-largest PCS licensee in the U.S. (in terms of Pops), with licenses for areas containing 95.4 million Pops concentrated in a contiguous area in the Northeast and including the New York MTA.
ú Omnipoint' s buildout has been slower than we originally expected, and the company continues to face challenges in acquiring cell sites. We believe, however, that the New York MTA contains some of the best wireless markets in the U.S. and that the relatively low wireless penetration of the New York area and high international traffic present a compelling opportunity.
ú Omnipoint is a development stage, capital-intensive GSM wireless service provider whose stock trades on the company' s progress in the buildout of the network, its subscriber additions, the valuation of PCS M&A transactions (including the auction prices of similar licenses) and the potential for strategic partnering and/or a takeover.
ú We believe there is a good chance Omnipoint will bring in a foreign investor at some point and, once the company has adequate coverage in a number of its markets, we believe its subscriber additions will significantly accelerate and bring a renewed interest in the stock. We rate Omnipoint as a Buy with a current target price of $26 (our target for year end 1997 is $31) based on a 15% discount to our private market value estimate of $30.
SUMMARY:
Omnipoint Corporation is a development-stage, capital-intensive GSM wireless service provider whose stock trades on the company' s progress in the buildout of the network, its subscriber additions, the valuation of PCS M&A transactions (including the auction prices of similar licenses) and the potential for strategic partnering and/or a takeover. Omnipoint has had a slower-than-expected buildout and ramp up of subscriber additions, and weakness in subsequent PCS auctions has caused the stock to come down significantly off its 52-week high. The stock has rebounded on strategic investor speculation as Omnipoint filed with the FCC to allow an increase in foreign ownership limits. The company officially stated that it is having discussions with foreign entities. While the FCC rejected Omnipoint' s request for a general waiver of foreign ownership rules, the Commission indicated, in our opinion, that it would likely approve a specific transaction as long as the foreign entity was in compliance with the WTO agreement. We believe there is a good chance Omnipoint will bring in a foreign investor at some point and, after the company gets ahead of the construction curve and has adequate coverage in a number of its markets, we believe its subscriber additions will significantly accelerate and bring a renewed interest in the stock. We rate Omnipoint as a Buy with a current target price of $26 (our target for year end 1997 is $31) based on a 15% discount to our current private market value estimate of $30.
We have published a full report on Omnipoint Corporation, dated August 1, 1997.
THE COMPANY:
Omnipoint is the fourth-largest PCS licensee in the U.S. (in terms of Pops), with licenses for areas containing 95.4 million Pops concentrated in a contiguous area in the Northeast and including the New York MTA. Omnipoint has launched service in the New York Metropolitan Area (the five boroughs) and expects to launch in Nassau and Suffolk counties and the Philadelphia metro area at the end of the summer, in Westchester and northern New Jersey later this year and in the Boston and Miami areas during the first half of 1998.
INVESTMENT THESIS:
Omnipoint Corporation is a development-stage, capital-intensive GSM wireless service provider whose stock trades on the company' s progress in the buildout of the network, its subscriber additions, the valuation of PCS M&A transactions (including the auction prices of similar licenses) and the potential for strategic partnering and/or a takeover. We believe there is a good chance Omnipoint will bring in a foreign investor at some point and, once the company gets ahead of the construction curve and has adequate coverage in a number of its markets, we believe its subscriber additions will significantly accelerate and bring a renewed interest in the stock.
INVESTMENT RISKS :
Among the risks are competition from cellular and PCS players, a challenging site acquisition market (zoning), significant capital expenditures required to build out licensed areas and delays in the availability of dual-band GSM/AMPS phones.
Robertson, Stephens and Company maintains a market in the shares of Omnipoint Communications.
-------------------------------------------------------------------- |
