ACNS: American Communications Services Message Board

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Technology Stocks : ACNS: American Communications Services

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To: Chris Pirnak who wrote ()	8/6/1997 11:23:00 PM
From: jim detwiler	of 102

-- American Communications Services (ACSI) reported results for 2Q97 with revenues of $11.6 million and a net loss of $25.8 million, both ahead of our estimates of $11.6 million in revenues and a net loss of $29.9 million. -- The Company achieved positive gross margins for the first time in its history (20%) -- Key productivity ratios showed significant improvements with revenue/SGA and revenue/PPE increasing over last quarter 23.7% and 21.1% respectively reflecting increased leverage in the business model. -- The Company is now offering its services in a total of 50 cities either on a resale (24) and/or a facilities (32) basis. -- Key financing of $335 million has been completed as of July 1997, fully funding the business plan until through 1998 allowing the planned network expansion to take place without cashflow concerns. -- We are reviewing our model with management and expect to revise our estimates in line to slightly up relative to current estimates. -- Reiterating our "strong buy" investment rating with a 4Q price target of $16 (enterprise value of 4.0x our 4Q estimated net PPE)

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