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Technology Stocks : NEXTLINK Communications, Inc.
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To: Rono who wrote (207)8/6/1999 9:33:00 AM
From: AurumRabosa  Read Replies (1) of 265
 
I don't doubt their technical approach. I only question whether or not they can over come the enormous negative cash flow hole they're in. I read a couple of the analysts' reports calling NXLK a "Strong Buy" and they did not address it. If you personally considered buying (or starting) a business, e.g. a shop that sold widgets, and you had to explain to your family why it was a reasonable risk to take with your life savings you'd do a business plan and model the cash flow. How many years could it be negative to justify the risk? In the case of NXLK I haven't found a projection for what year it will go positive but the projections out into 2002 show it getting increasingly more negative.

As to the timing I can't claim much more than luck. I was negative on the general market and when I saw the yield on the long bond exceed 6% again and the dollar tanking against the yen to below 115 (and now 114) I felt a sense that foreign money would start to be repatriated. I'm looking for the yield on the 30-year Treasuries to hit 6.5% within 2 months at which point I'll buy zero-coupon bonds. On this basis I shorted the general market by buying S&P100 puts (OEZTC) a couple of weeks ago. Then I decided to subscribe to the GTR and starting going down the list looking for stocks on his list that had sound fundamentals and almost all are in the "New Era" category that use the New Math and I can find no way to justify their present market valuation. So I bought puts on many of them starting with NXLK. But thanks for the compliment anyway.
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