Jack- Don't have much on Furman, but it would not surprise me. I
agree with the analyst on ICIX and TCGI, less enthusiastic about
Brooks, Much more enthusiastic about GST. Brooks has an equity
value of about $770 million at todays close. GST, $168 million. They
will do about the same $ in revenue this year. GST, however, has
much more value at the current price. 1) Ownership of 5.1 million
shares of NACT, a company growing at 30%+ both top & bottom line &
nicely profitable: worth $35 million at todays close. 2) Ownership
of up to 8 million shares of GST Global, an international CLEC
and one of six firms authorized to build out Mexico: worth $25-40 mill
at todays close. 3) Long distance business with $40 million (?) invested
worth conservatively at least what they paid, likely much more: $40 mill
4) Internet business. Adding these up, I get $100-115 million. let's
say $100. So the market is placing an equity value of about $70 million
on about $300 million of invested capital in their local business, or
about $4 per share. That to me is a serious mis-pricing a represents
a serious opportunity for value. Thier numbers are due on the 12th
of May, and are likely to be better than expected. Most of the other
stocks in the group have traded up in response to good numbers in the last week.
The FCC ruling will be a positive for the CLEC's on the 6th of May,
and will likely get dragged out anyway. Bottom line: this company is worth more than
double it's current price, especially to someone looking to enter
the lucrative California market quickly. GST is under-followed, but
has tremendous momentum behind it. The new president, former COO of
Cable & Wireless PLC and the rest of the managment team have large
incentives to see higher stock prices. Strong Buy. |
