ALGX research and thoughts
Allegiance Telecom, Inc. is a telecommunications services provider to small and medium-sized businesses in major metropolitan areas across the United States. The Company offers an integrated set of telecommunications services, including local, long distance, data and Internet services. The Company's network rollout has proceeded on schedule, with 27 markets operational as of December 31, 2000, consisting of Atlanta, Baltimore, Boston, Chicago, Cleveland, Dallas, Denver, Detroit, Fort Worth, Houston, Long Island, Los Angeles, Miami, Minneapolis/St. Paul, New York, northern New Jersey, Oakland, Orange County, Philadelphia, Phoenix, St. Louis, San Diego, San Francisco, San Jose, Seattle, Tampa and Washington, D.C. In addition, San Antonio became operational on March 6, 2001. The Company expects to complete the rollout of its 36 targeted markets by the end of 2001.
For the six months ended 6/30/01, revenues totaled $229.9 million, up from $110.2 million. Net loss increased 69% to $199.7 million. Results reflect an increase in the number of customers and lines installed, offset by an increase in personnel expenses.
Market cap 689 million
Cash on hand is 2.77/share
Debt/equity is .73
short % is 10.5
Their losses have been increasing every quarter, here are the last 4 quarters:
-.67
-.77
-.87
-.92
Sep quarter estimate is -.98
Dec quarter estimate is -.98
2002 estimate is -3.43
There are 24 analysts that follow the stock and I just dont understand what they see in this GTZ POS.
The stock was up 47% on no news today.
Kaufman Bros is having its 4th Annual Emerging Communications on October 15th and 16th, 2001 in New York City at the W Hotel in Midtown.
ALGX is scheduled to present on Tuesday at October 16 at 12pm.
All the fiber optics companies rallied today and I guess that along with the presentation lifted the stock.
Here is the recent guidance they issued on Sep 27
Allegiance said it expects revenue for the third quarter of about $135 million, below analysts' expectations of $147.2 million but up 9% from the second quarter and 69% from the year-ago period.
The consensus estimate calls for a third-quarter loss of 97 cents a share, according to Thomson Financial/First Call.
The company expects revenue for 2001 to be about 5% lower than previous estimates of $550 million, or about $522.5 million. Allegiance said 2002 revenue would be at least $800 million.
Analysts were expecting the company to have revenue of $545.5 million for 2001 and $900.4 million for 2002.
Sep 18 news:
Allegiance Telecom Raises Additional $350 Million of Funding
biz.yahoo.com
Conclusions:
The fundamentals are absolutely brutal.
Expected losses next 6 quarters combined are -5.39
Cash of 2.77/share plus credit of 350 million (which is 3.10/share)
Keep in mind when they do draw down on more debt, their losses will increase as well.
By 3rd quarter next year this company will be suffocating and very close to GTZ status.
I dont understand why they arent $1.00 now.
I shorted a core position today at 6.04 and eagerly want to add trading shares.
Happy Trading
Michail |
