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Strategies & Market Trends : Value Investing
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To: Terrapin who wrote (8633)10/13/1999 11:24:00 AM
From: Madharry  Read Replies (2) of 78671
 
I think there are some wonderful buys out there myself they are just not value plays exactly- My favorite one right now is called Ortel. Ortel is not profitable right now but they just reported that they are moving toward profitability faster than expected and their stock is up about 50% in the past 2 days. They are in the field of fiber-optics but what is most interesting is that they have an 18% interest in a privately held company which is made up of some old Bellcore division, the other investors are very high powered I believe INTEL is one. That subsidiary is called Tellium, and it already has a contract for $250MM! with a company called Extant. Extant is closely held and equity owners include SFE and Peco Energy, so there are some pretty sophisticated and deep pockets there. It is my belief that if Tellium were to go public today it would be worth anywhere from $2.5Billion to $6Billion-my best guess being $5Billion making ORTL's interest worth about $900MM. Ortel's market cap is about $260MM. Even if I am off by a big margin here I think there is an awful lot of "relative" value here and I added to my position today even at these comparatively exalted levels. The catalyst here may be the upcoming IPO of Sycamore which is a competitor. Depending on high how SYcamore goes it should give Ortel a pretty strong kick. Of course I have been wrong before and may well be again.
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