[Epoch Company Report on TSIX] RESEARCH REPORT 360networks NASDAQ: TSIX
Mark Langner, Managing Director, Senior Analyst
Todd Fernandez, Associate Analyst
Bert Bangayan, Associate
Closing price as of 01/16/01: $14.63
(Closing price the day before report was published.)
Investment Thesis
360networks is quickly becoming one of the most important and influential players in the fast-growing market for global data-transit services. As an infrastructure builder, the company has excelled on all fronts by deploying a long-haul data network bigger, faster, and cheaper than any builder that has preceded it. The company's success on this front favorably positions it in the communications services world, where customers are demanding more bandwidth at a lower price. 360networks is aggressively deploying cutting-edge technology across its network in order to provide unique service capabilities based on the latest technologies at competitive price points. In our opinion, this positions 360networks as a viable challenger to legacy carriers as well as other next-generation network service providers. Given the recent stock-price softness in this sector due to overblown concerns of an oversupply of bandwidth, we believe TSIX stock represents an opportunity for investors to purchase this up-and-coming leader at an attractive price.
Company Description
360networks is a facilities-based, wholesale provider of global data-transport services. The company is in the process of deploying a global, IP-centric network that will eventually span over 88,000 route miles, connecting North America, South America, Europe, and Asia.
Key Investment Points
Innovative Infrastructure Provider: Combining efficient capital allocation and steadfast execution, 360networks is on the verge of completing one of the first global data-centric networks at a pace unmatched in the history of communications services.
Leading Edge Technology Adopter: 360networks is aggressively deploying a next-generation network. The company is far ahead of legacy carriers with respect to its core technology (optical switching), topology (meshed architecture), and protocol orientation (MPLS-based IP). This lead should allow the company to cost-effectively provision capacity, deliver unique services to customers, and scale to meet demand.
Large and Rapidly Growing Market: The Yankee Group estimates the wholesale market for broadband transport alone will grow from $6.7 billion in 1999 to $17.4 billion in 2002.
Management Team: CEO Greg Maffei has brought keen capital-raising and strategic-development capabilities to 360networks that may give the company a competitive advantage.
[This is page on of a 37-page report available in Adobe format]
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