Excel Communications Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Excel Communications

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: David L. Gibson who wrote (2522)	2/9/1998 12:36:00 PM
From: Rob S.	Read Replies (1) of 2806

I don't think that the reason why the stock is not performing is because the "street" frowns on MLMs. The street frowns on stocks that don't meet expectations for earnings. Excel has shown growth in customers and minutes of LD service but has been under pressure due to higher costs and slower and more costly than expected transition to the recently acquired Telco network. The bottom line is that Excel was forced to take major write downs for Telco expense and margins have slipped due to higher customer acquisition costs. I think that the dissapointments are somewhat expected as a part of the transition from a LD reseller to a major LD facilities provider. This has been a major shift in the way Excel goes about its business. Sure it could have gone better, but it is now expected to get back on tract so that customers are migrated to the internal LD network on schedule by the end of hte year. This quarter should start to show some of the lowered cost benefits of the transition. By early next year Excel will have one of the lowest cost structures in the industry for delivering LD service. The commercial program has great potential for high growth rates. When this shows up on the bottom line the street will take notice. But Excel has not given any firm guidance on how this is expectedd to effect earnings for this or next quarter other than to say that it will not be major. This too may be a shift that has some growing pains; Are Excel IRs oriented and up to the task of growing into the commercial sector? Will they successfully leverage their contacts? Will Excel be up to the task of supporting the commercial market smoothly and to the high level of customer support that is expected in the sector? A lot remains to be proven. Past dissapointments tend to color the interpretation of current events. Excel has been faced (along with the entire industry) with the monopolistic policies of the local access providers. That has prevented Excel from providing local access service which was expected to be a big area of growth. If and how long will it take for the local phone companies to relinquish their monoploies and how long will Congress take to top force change? That might depend on how much money each side poors into the coffers of attorneys and Congressmens slush accounts. (My view is that the government should extend the right of public domain and take over the local companies and put their broken up functions up for auction - if the highway must to get built, bulldose those who get in the way!). Excel has shown fair price stability recently. It will be the stage for a move up IF growth is starting to kick in. How well the commercial program is doing and how well overall sales and earnigns are turning out will determine how well the stock does. I think that Excel has a good chance of moving much higher by the end of hte year, but then again, the company has reported dissapointments in the past and must follow through on expectations for the stock to appreciate very much. In the last conference call, Kenny Trout were conservative in their views for future earnigns growth. I think that was calculated to lower expectations so that dissapointment is less likely. Now if the company just meets expectations, the stock will likely move up. The bottom line is that Excel stock will move up in line with the performance in sales and earnings.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next