CellularVision USA Up 17% On Upcoming FCC Auction
By Matthew Newman
January 20, 1998
NEW YORK (Dow Jones)---CellularVision USA Inc.'s (CVUS) shares rose nearly 17% Tuesday after the Federal Communication Commission decided to proceed with a broadband wireless license auction next month, the company said.
In 1991, the FCC granted CellularVision a license to 1,150 MHz of spectrum throughout the 1,100 square mile New York metropolitan area, whose population is about 8.6 million. The company has used the license to provide wireless cable service and high-speed Internet access to parts of New York City.
Manuel Asensio, an analyst at Asensio & Co. in New York, said CellularVision's license is the most valuable local multipoint distribution service license in the country because its area has the highest population concentration. However, the company's stock has been "grossly undervalued" at its trading price range of 5 to 10 because investors don't realize the potential of that license, Asensio said.
"It's a brand new industry that people aren't aware of," he said, but after the FCC auction, scheduled for Feb. 18, investors can put a specific dollar amount on CellularVision's LMDS license.
The auctions will proceed on schedule because the FCC didn't delay the acceptance of applications, which were due Tuesday, according to an attorney for the Commission.
Investors were concerned that the FCC would once again delay the auction of 493 LMDS licenses, which will allow companies to offer a package of high-speed Internet, video and telephone services, said CellularVision Chairman and Chief Executive Shant Hovnanian.
In November, the FCC said it delayed a Dec. 10 LMDS auction so companies could line up more financing to compete in broadband wireless industry, which is expected to merge aspects of the telecommunication and media industries.
The Commission also wanted to give the U.S. District Court more time to resolve possible lawsuits from telecommunications and cable companies, CellularVision said.
In an interview, Hovnanian agreed with Asensio's assessment that his company's stock rose because investors can soon value its LMDS license, which is currently the only one granted by the FCC.
CellularVision shares rose 1, or 16.7%, to 7 on volume of 142,800, compared with a daily average of 51,100.
-By Matthew Newman; 201-938-2094; matthew.newman@cor.dowjones.com |
