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Technology Stocks : Intermedia Communications ICIX
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To: Steven Bowen who wrote (82)2/9/1998 11:33:00 AM
From: Kingpin  Read Replies (1) of 313
 
Steven, My main attractions ICIX are:

1.The Fact that Brooks Fiber and Teleport both sold at 5-6 gross plant. ICIX currently sell for about 1/2 of that. They will have about 6mil in net plant after this quarter that is already complete. (This is based on average growth rates in plant over the last few quarters plus some amatuer projections I have heard bandied about ) They have made some impressive acquisitions this quarter. Including one that will increase revs by 40% and reduce ebitda losses accordingly.

2. ICIX is estimated to have EBITDA of 165M by end of 99'
TCGI is estimated to generate about 190M. ( Lazard Freres)
TCGI's market cap is about 7 times that of ICIX
(although TCGI has a lot more installed fiber and CLEC lines in service ( Goldman Sachs)

3.ICIX was selling service in 2703 buildings as of last quarter. The purchase of LDS adds 45,000 new bus customers and $111,000,000 in revs
Brooks in in 3800 buildings as of Q3. As you now Brooks just sold for 5X plant and trades at 11X trailing revs.(Using Total Enterprise Value)

Last Quarters Anualized Revs (Goldman Sachs)

ICIX.......284,986,000 ( since bought LDS and 111 MM in REvs)
BFPT 143,424,000
TCGI 525,600,000

4.They are considered ( by some ) to be the best wire based CLEC left.

5. They have the largest and most comprehensive data and internet capabilities of all the other CLECS ( Lizzard Brothers)

6. Projected to grow revs 50% on a sequential basis for the next 8- 10 quarters (S&P)

I do not know of the risks associated with this one. Everyone is so positive it scares me. I think I'll take SteveG's advice and try to buy it a little closer to the 50 day.( about 56). Trading 63 right now.
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