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Technology Stocks : PSIX up 26.5%, Takeover(?) -- Ignore unavailable to you. Want to Upgrade?

To: KyrosL who wrote (5174)	11/2/2000 4:48:13 PM
From: GHowe	Respond to of 5650

They talk about a cash burn rate through 2001, however this company will need the capital markets for the next few years, until they become free cash flow positive. How many more millions will they need? far more than they need through 2001, because they ended Q200 with $1.5 billion and had $1 billion at the end of Q300. It's tough to go to anyone, let alone the capital markets who you've toasted over the past few quarters, and ask for cash when you essentially have none. Either the company has to dramatically cut its capex to become free cash flow positive in an absolute hurry (before they run out of cash), but the paradox is that its growth rate will suffer dramatically as well, hence a lower valuation (tough to be worth less than $3 per share). Or the company can find a huge, strategic investor to help run the company. Maybe then, the equity holders will make out okay, but I'd hate to own the shares sitting around waiting for that to happen. Just my opinion, though. G Howe