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Technology Stocks : DSL.net (DSLN)

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To: CrayUSA who wrote (162)	8/24/2000 11:58:25 AM
From: SEAN007	Read Replies (3) of 169

The facts on DSLN 1. DSLN deal with IBM is nonexclusive and does not guarantee any revenues to DSLN. In fact given DSLN past history and operating performance its costing approximately $5 to add a new subscriber line for each $1 in revenue it brings in (per 10Q) 2. DSLN relative valuation compared to its peers Rythms Netconnect (RTHM) Covad Communication (COVD) Northpoint Communications (NPNT) DSLN price/sales 388 RTHM price/sales 24 COVD price/sales 15 NPNT price/sales 24 3.Value of each subscriber line (Marketcap/# subscriber lines) DSLN $94,000 per Dain Rauscher 7-28-00 research report or 6100 subscriberlines RTHM $23,000 COVD $19,000 NPNT $ 24,000 4.Buy out speculation The rule of thumb for these type of buyouts is 2.5x-3x property plant and equipment (ppe). Under this scenario DSLN buyout price would be approximately $3.41 a share. $74,000,000 in fixed asset (source 10Q) X 3 / 65,000,000 shares outstanding. A 55% stake was taken in NPNT by Verizon, using that as a basis for the buy under the value would be 2.85 to 3.41 per share. That is one of the reasons DSLN traded at $2.5 to $3.5 last week. 5. A large number of insiders filed to sell their shares in the $3 -$4 range. biz.yahoo.com

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