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Strategies & Market Trends : Rande Is . . . HOME -- Ignore unavailable to you. Want to Upgrade?

To: kha vu who wrote (25829)	5/13/2000 10:28:00 AM
From: DlphcOracl	Read Replies (1) \| Respond to of 57584

kha vu: GBLX bottom is probably somewhere between 28-30. Unlike many other beaten-down stocks, do not look for this one to rebound quickly. Because of its never-ending stream of acquisitions, for which they always seem to pay a rich premium (ie., overpay), they have staggering debt which will put profitability years away. I think they are best thought of in terms of stock price action (and subsequently treated by the market) as an internet stock. Having said that, I think GBLX is an excellent LONG-TERM investment if you buy with the intention of holding for 1-3 years. They are nearing the end of their buildout, they have impressive web-hostinng and storage facilities that rival Exodus (via the Frontier acquisition) and have a unique fiberoptic broadband franchise with world-wide reach; the Racal and Japanese deals give them access into Asia and Europe and the Frontier deal gives them a satisfactory US base. At some point, when there is clear cut evidence that they are narrowing their reported losses each quarter, GBLX will begin to appreciate. More likely, they will be taken out and acquired by one of the giant telecoms (? Alcatel, Deutsche Telecom, SBC) at a considerable premium. IMO, there are better investments that are similarly beaten-down with much better prospects for sharp rebound in the next 6-12 months (CTXS, RBAK, QLGC, EMLX). All this is IMO, of course. I hope this helps.