Bernard:
<<So instead of gloating, you should congratulate
yourself on having been right so far, and buy
with both hands as soon as the market turns.>>
I would not classify my comments as gloating. Keep in mind, my pessimistic assessments of Winstar were made long before the market starting tanking. Please give me credit for that.
As for your other comments, I agree with your assessment of the telecom space. Incumbents do lose market share, and Winstar may have an inherent cost advantage. Where I think you and others are wrong is in thinking that this alone justifies a long term investment. Their cost advantage is only valid as long as the market continues to fund their buildout.
Notice that Winstar is reliant on market sentiment for their business model, because they can't fund their business through internally generated cash flow. So in many ways, the market crash is a self-fufilling prophecy. As capital becomes scarcer, it becomes ever harder for Winstar to execute. This in turn makes revenue predictions even more questionable, which further drives down Winstar's present value.
Bernard, I respect your opinion. Do you really think that things like negative cash flow are totally irrelevant, particularly when the market is grappling with its overall conception of risk?
Regards,
JC |
