A little different than this afternoon's report:
WinStar seen benefitting from FCC report - analyst
Reuters Story - November 07, 1997 13:04
%TEL %PUB %US %RCH %HOT WCII %ENT T FON AGRPA V%REUTER P%RTR
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NEW YORK, Nov 7 (Reuters) - Shares of WinStar
Communications Inc rose almost eight percent Friday
after an analyst said a recent Federal Communications
Commission report would benefit the telecommunications firm and
make it a more attractive acquisition candidate.
NationsBank Montgomery Securities telecommunications
analyst Bill Vogel said the FCC report "increases the
visibility of WinStar's franchise. It shows that the asset is
not encumbered and not potentially encumbered going
forward....This makes it a much clearer franchise."
The FCC was not immediately available to comment.
Vogel reiterated a buy rating on WinStar and raised his
price target to $60 from $41.
Shares of WinStar jumped 1-15/16 to 26-7/8 in early
afternoon trading.
Another analyst, who declined to be named, said "The
comments from Montgomery are driving it (the stock) today.
WinStar fundamentals are good and they own more spectrum than
anyone in the country, but the shares are up today on the
(analyst's) comments."
WinStar did not immediately return calls seeking comment
on the share activity.
Vogel said the FCC report clears up several issues
regarding WinStar, which could make it a more likely
acquisition target. Potential buyers, such as AT&T Corp
and Sprint Corp , could pay "as much as $80 a share or
more for this company," Vogel said.
The FCC report puts no limit on the accumulation of 39
gigahertz spectrum, the frequency that WinStar uses to provide
its telecommunications services. WinStar will be able expand
capacity to meet customer demand as needed, Vogel said.
The FCC also rejected a request by the satellite industry to
relocate WinStar's licenses to another spectrum band, Vogel
said. Relocating the spectrum would have been disruptive for
WinStar and its customers, he said.
The FCC report would also allow WinStar to use its spectrum
to enter the broadcast and mobile markets, as well as serve as
both a common carrier and a private carrier. With the new
private carrier distinction, WinStar would be able to customize
pricing and services when building a virtual private network,
Vogel said.
WinStar later said it was "pleased with the FCC's action."
Frank Jepson, WinStar's senior vice president of capital
markets, said the company's stock price was helped by several
factors, including the FCC report, Vogel's comments, its recent
strong earnings report and an investor roadshow by a
competitor, Teligent.
Teligent, part of Associated Group Inc , is
conducting a roadshow ahead of it initial public offering.
Teligent's presentation is drawing attention to how wireless
local exchange telecommunications systems work, Jepson said.
"This is having a positive impact on the wireless sector,"
Jepson said.
WinStar said it sees its main competitors as the wireline-
based telecommunications companies that dominate the local
telephone markets and is not threatened by Teligent's pending
IPO.
"There is more than ample room for more than one, two or
more wireless providers to thrive," Jepson said.
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Also, from the Fool's
Winstar Communications Validated by FCC Report
The Motley Fool - November 07, 1997 17:23
WCII Montgomery V%MFOOL P%TMF
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Jump to first matched term
November 7, 1997/FOOLWIRE/ -- Shares of competitive local
exchange carrier WINSTAR COMMUNICATIONS (Nasdaq: WCII) gained $3 3/8 to
$28 5/16 after NationsBanc Montgomery Securities said a recent FCC
report validates the company's franchise. Montgomery has been pounding
the table on Winstar for a while now. The FCC report says that Winstar
can keep on adding to its assets in the 38 gigahertz spectrum and that
it doesn't have to relocate its traffic to another part of the radio
spectrum, as was requested by a satellite company. This makes Winstar
more attractive in the eyes of acquirers, according to analyst Bill
Vogel. 38 gigahertz is significant because the higher in the radio
spectrum a signal is, the higher its bandwidth and data throughput.
Winstar offers "wireless fiber," the dishes for which can be
unobtrusively affixed to a rooftop or building ledge and pointed toward
a Winstar relay, which eventually bounces the signal toward the central
office of a regional Bell company or an interexchange carrier, which
then sends the signal on to the backbone of the long-distance
network. |
