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

To: Gregg Powers who wrote (16025)	8/22/2000 12:57:00 PM
From: Rocket Scientist	Read Replies (3) \| Respond to of 29987

<<one could argue that our $60 million investment controls in excess of 10% of the economics of an entity that you believe could be worth $40 billion>> Would you mind clarifying the above? The 40B$ market cap was referenced to all of GLP, correct? To control 10% of GLP, one would have to acquire 25-30M shares of GSTRF. For 60M$, one could have purchased at most 10M shares (which would be no small accomplishment, for sure, considering the float is (was) probably less than 60M shares.) Do you own options as well or what am I missing? Contrariwise, if you believe that GSTRF's market cap will approach 40B$ in some timeframe, that implies a value on all of GLP of 100B$; at a 30X P/E, 3B$+ net after tax income is required, which would imply a nearly full constellation; in what time frame do you envision that happy occurrence? TIA for your comments. RS

To: Gregg Powers who wrote (16025)	8/22/2000 3:53:06 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 29987

<Timing is, of course, everything. Can the stock trade lower? Sure. Can I hope to assemble an economically meaningful position at the bottom? Of course not. The bottom line, however, is that I believe that within a six-month window the company will begin to demonstrate significant operating traction.> Well, there's one advantage to being a Little Guy. Little Guys can fill their Tonka-Trucks right at the bottom and not move the market an iota. Then they can buy a Guy-Sized Globalstar phone and wait for the fun. Now I don't know whether I'd rather be one of those Elephant-Sized investors and have to buy way off the bottom or stay Tonka-Sized. If I could buy a Tonka-Sized Gulfstream, I guess small would be good. Maybe we are seeing evolutionary pressure for Lilliputian-Sized investors with nano-technology Globalstar phones and micro Gulfstreams. Big is better mainly in the context of brute force and physics in the wild. It gets cold when one is ant-sized trying to maintain a warm body temperature. Air resistance for ant-sized things is annoying too, when trying to fly in a hurry, although low body-weight in flight is some compensation. Small pigs might fly! I'm hoping Globalstar will too. If you [and the Service Providers you talk to] are right that demand for Globalstar is going to be proven at the current high minute prices, then this company is going to be one of the most profitable enterprises ever. Well, I constantly understate things in my usual conservative way - it will be the first company to be worth more than $1 trillion. It will get there just ahead of QUALCOMM. I've held my investment [and gone totally greedy at $15] on the basis that they would NOT be able to sell all their minutes anywhere near current prices but would succeed at near cellular prices, which still leaves plenty on the bottom line. At 40c per minute [fixed, mobile and data in a proportion giving that figure] x 10 billion [which I think will be conservative given the improvements Q! is making to CDMA technology - so what the heck, double that to 20 billion] = $8 billion a year top line. Keep in mind that that is just for Constellation1. They can double and double capacity again every two or three years once they get satellite and rocket production lines humming. Okay, let's just go for one more doubling [but with a few bonus satellite in 10000 km orbit for easy oceanic coverage]. That will take us through to about 2007 [which is far enough into the forseeable future to get a decent sort of NPV]. With 50 billion minutes selling at that date, at 40c a minute, we get $20 billion a year. Take off launch costs, Bernie's and a few salaries for flying the satellites and a few muck-ups along the way and we still get about $18 billion per year. With 300 million Globalstar LP shares, that's $60 a share. That'll be about $20 [give or take a bit] for GSTRF shares. With a growth rate of 30% or 40%, a price to earnings ratio of about 50 would be conservative. That would make GSTRF $1000 a share. GLP would have a BIG market capitalisation. I would buy a GUY-Sized Gulfstream, with IFN and fast WWeb access thanks to Q! and G! Mqurice