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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: djane who wrote (8040)	10/26/1999 9:35:00 PM
From: Rocket Scientist	Read Replies (1) \| Respond to of 29987

Let's see, Nabi expected 950K subs by y/e 2000 and had a price target of 37. Now he expects 570K and sets a price target of 30. What kind of ARPU does he assume, I wonder? If G* managed to reach 950K by y/e 2000 at management's estimated ARPU, it would be at EPS b/e by then; with an implied subscriber net add rate of about 80K/month, implying annualized pre tax earnings by y/e2001 of at least 4$/share, with a likilihood of continued yr/yr growth of 4$/share for several years. And he believes a stock in that sitation would be valued at 37$? Even at 570K, the company should be at cash b/e at y/e 2000 with implied net add rate of 50K/month; and if you believe it's at 570K subs instead of 950K because of slow production, surely that problem will have been solved by 2001, and one could look forward to doubling that net add rate with resulting 2002 EPS around 5-6$ with good growth. And in such a situation the stock would be valued at 30 by y/e 2000? How much does MS pay this guy?

To: djane who wrote (8040)	10/27/1999 12:09:00 AM
From: Jon Koplik	Read Replies (1) \| Respond to of 29987

With all due respect ... this is possibly one of the dumbest things I've ever heard ! (By the way, is "dumbest" really a word ?) I have a theory -- by having a situation with G* handsets in short supply, several things happen : 1. Those of us who want a handset (me, for example) will feel lucky to get one at all. 2. Pressure to reduce pricing on the handsets is diminished. 3. If financial results are lousy, G* management can (legitimately) say that results would definitely have been better if only more handsets had been available. 4. If some handset improvements (battery life, size, weight, whatever) are "lurking," any potential old inventory overhang problem is almost impossible. I think the slow handset production rate may be by choice (but, we will never hear this !) Jon.