Silicon Investor (SI) -- The First Internet Community

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 : Primestar/TCI Satellite (TSATA) -- Ignore unavailable to you. Want to Upgrade?

To: driftwoodfarm who wrote (426)	1/20/2000 12:45:00 AM
From: architect*	Respond to of 442

FWIW Litwick candlestick charting service has TSATA as the #1 most bullish candlestick for 1/19/00 TOP 25 Bullish By Reliability Technical analysis + any news soon and TSATA is ready for new highs! Name ....Indicator Pattern...... Trend....... Reliability TSATA TCI SATE.Three Outside Up Reversal Bullish.... High litwick.com must register

To: driftwoodfarm who wrote (426)	1/21/2000 12:08:00 AM
From: Katie Kommando	Read Replies (2) \| Respond to of 442

January 20, 2000 Dow Jones Newswires IN THE MONEY: Wager On Malone Spurs TCI Satellite Stock By MICHAEL RAPOPORT A Dow Jones Newswires Column NEW YORK -- Sometimes - not often, but sometimes - there's a legitimate reason for a stock to get ahead of itself, to trade for a much higher price than its fundamentals would seem to dictate. At this point, TCI Satellite Entertainment Inc. (TSATA) isn't much to look at. It's essentially a holding company whose primary asset is a stake in General Motors Corp.'s (GM) Hughes Electronics Corp. unit (GMH). It had no revenue for the first nine months of 1999, and right now has no operations of its own. Yet the stock has quietly escalated - gaining about 1,700% over the past nine months, and nearly doubling in the past several weeks alone. And the reason appears to be that investors are putting their faith in the acumen of one man: John C. Malone. In fact, based on the numbers, investors appear to be placing a bet on Malone worth about $800 million. Malone, of course, is the cable-TV magnate who built Tele-Communications Inc. into a behemoth before AT&T Corp. (T) acquired the company last year. More importantly for current purposes, he's also the chairman and a major shareholder of both TCI Satellite, which was spun off from Tele-Communications before the AT&T deal, and of Liberty Media Group Inc. (LMGA), the former Tele-Communications subsidiary that is now an AT&T unit with its own tracking stock. Last month, Liberty Media agreed to invest $300 million in TCI Satellite - getting TCI Satellite preferred stock that holds 80% of the company's voting power in exchange for a Liberty Media stake in shares of Sprint Corp. PCS Group (PCS). Perhaps more importantly, the companies also agreed to form a joint venture, initially 90%-owned by Liberty and 10% by TCI Satellite, that will hold interests in companies that distribute high-speed data via satellite - so-called "satellite broadband" businesses. Liberty has said it intends to use the joint venture to consolidate its various satellite-related assets. That has sent TCI Satellite shares soaring, on optimism that Malone and Liberty will make shrewd, profitable bets in the wireless broadband sector and that TCI Satellite will share in those opportunities through the joint venture. "I view the joint venture as the umbrella under which Liberty's broadband strategy will be played out," said Ted Henderson, an analyst with Janco Partners Inc. in Denver. TCI Satellite shareholders, he said, are buying up the stock because of the opportunity "to own very attractive wireless assets and to be positioned with someone who's a dealmaker." Investors are "optimistic" about Malone's ability to pick winners, Henderson said, and certainly Liberty seems to have designs toward becoming a bigger player in broadband transmission of video and other data. In December, it invested $425 million in Astrolink LLC, a wireless broadband venture, and also established an alliance with Cendant Corp. (CD) that involves distribution of broadband video. Liberty also recently completed its acquisition of Associated Group Inc., the biggest shareholder of wireless phone company Teligent Inc. (TGNT). Besides the benefit of Malone's savvy, TCI Satellite will get $300 million in fresh capital with which it can make acquisitions of its own - and can use its own surging stock as a currency toward that end as well. As recently as last April, both classes of TCI Satellite stock traded for about a dollar a share; by last month, they had broken into double digits, and they've gotten as high as 20 since then. The company's Class A stock closed Thursday at 17 3/4; the more thinly traded Class B stock closed at 18 1/2. Liberty Media stock has also gained, albeit less dramatically. Liberty's Class A shares have risen from 49 7/16 to 55 since the December agreement was announced; its Class B shares have gone from 56 1/4 to 66 1/2. As for that $800 million bet: At current prices, TCI Satellite's market capitalization has surged to nearly $1.3 billion. But as of right now, it effectively has assets worth less than $500 million: Its 1.4 million GM Hughes shares have a market value of about $170 million, the deal with Liberty will add another $300 million in capital, and the company has another $9 million or so in scattered small assets. Buyers of TCI Satellite's stock are apparently hoping Malone and the joint venture will help close that gap. In driving up TCI Satellite's stock price in advance of any further activity by Liberty Media and Malone, then, investors may be putting the cart before the horse, Henderson acknowledged. But in this case, "the guy driving the horse has a track record of being very productive." Now it's up to Malone and Liberty. Will they buy more satellite and wireless assets? Will they add those assets to the joint venture with TCI Satellite? And will that enrich TCI Satellite shareholders? Spokesmen for both Liberty and TCI Satellite couldn't be reached for comment Thursday. -Michael Rapoport, Dow Jones Newswires, 201-938-5976, michael.rapoport@dowjones.com