Telebras (TBH) & Brazil Message Board

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Strategies & Market Trends : Telebras (TBH) & Brazil

TBH 1.060

-0.9%

Nov 6 3:59 PM EST

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To: djane who wrote (7677)	9/9/1998 2:16:00 PM
From: Steve Fancy	Read Replies (1) of 22640

Here's some radical contrarian thinking for ya all... We all expected great fortunes by now but instead the stock did an absolutely unbelievable about face and defied all the bullish factors surrounding it. Now most folks seem to be on the looooong time till recovery and going much lower train. I think this has the potential to turn into a real analyst blaster. If these companies were to list in Brazil tomorrow, based on the current stock price of $60, I figure they'd list at the following prices: Company Percent of ADR Listing Value ======= ============== ============= Telesp Participacoes 25.6% $15.36 Tele Norte-Leste 29.5% $17.70 Tele Centro-Sul 15.3% $ 9.18 Telesp Celular 2.8% $ 1.68 Tele Sudeste Celular 2.4% $ 1.44 Telemig Celular 1.2% $ 0.72 Tele Sul Celular 1.4% $ 0.84 Tele Centro Celular 1.5% $ 0.90 Tele Norte Celular 0.5% $ 0.30 Tele Leste Celular 0.7% $ 0.42 Tele Nordeste Celular 0.9% $ 0.54 LONG DISTANCE ============= Embratel 16.8% $10.08 Assuming decent earnings which are expected to be released with the listings, and some strong strategic statements from the new buyers (Telefonica has press conference scheduled for Sept 17 I believe), it seems possible to me that the long speculated frenzied buying could still take place. Look at how cheap these things could be. All of a sudden we won't be talking a $60-$100 stock, and it sounds like only Telesp may remain in the Bovespa index. For that matter, the mandatory reweighting of the index may really skew the investment communities perception of the index's trading range and this may help also...Really nothing to compare against. I think based on these prices, folks may load up across the board and just throw 'em in an account and not look back for a few years. I'm certainly not counting on it, and have reduced my exposure to this stock by over 50%, but I'll be watching close. I think the next 30-45 days could surprise us yet. Rose colored glasses back off. sf

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