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Technology Stocks : PCW - Pacific Century CyberWorks Limited -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (969)	4/4/2001 1:46:01 PM
From: ms.smartest.person	Read Replies (1) \| Respond to of 2248

WRAP: HK's PCCW Hits 20-Mo Low, Bottom Nowhere In Sight Updated: Tuesday, April 3, 2001 07:42 AM ET By Rita Raagas De Ramos Of DOW JONES NEWSWIRES HONG KONG (Dow Jones)--Hong Kong's Pacific Century CyberWorks Ltd. (PCW, news, msgs) touched a 20-month low of HK$2.70 Tuesday, a level that would have signaled a buy for many stocks amid a global environment of bargain hunting - except this counter. The problem with PCCW, many who monitor the stock say, is that it is bound to fall further and "no one can tell for sure" when and at what level it will hit bottom, said Henry Lee, investment financial advisor at Hendale Investments. Even the best-effort estimates are made with utmost hesitation. "I believe HK$2.50 could be an immediate support level, but I won't be surprised to see it slip further to HK$2.00," said Lippo Securities Ltd. associate director Kitty Chan. Following a one-day suspension of trading of PCCW shares, the stock quickly fell to a low of HK$2.700 Tuesday, it's lowest since touching HK$2.707 August 6, 1999. At the close, the stock finally settled at HK$2.725, down 11.4% from Monday, and down 90% from its record high of HK$28.577 Feb. 15, 2000. In New York Monday night, PCCW's American Depositary Receipts fell 14% to the equivalent of HK$2.65. The decision of Britain's Cable & Wireless PLC (CWP, news, msgs) to make a quick exit from the financially troubled PCCW by issuing Monday US$1.5 billion, two-year zero-coupon exchangeable bonds inevitably dealt the blow that crushed the already battered PCCW stock, analysts said. Analysts figured that if Cable & Wireless, which owns 14.7% of PCCW, is all too eager to exit the company, why should other investors stick with the stock? PCCW's huge stock price losses, for Tuesday, at least, was blamed on one thing: institutional investors - mostly from the U.S. and Europe - shifting their holdings in PCCW from equity to the exchangeable bonds. At least with the bonds, even at zero coupon, investors get their money back upon maturity on June 9, 2003, limiting the downside from any further share price losses. An added plus to the bonds is they could easily be exchanged for shares in the event that management somehow turns PCCW around. While the exchangeable bonds saved PCCW from Cable & Wireless simply dumping its stock on the market and driving share prices further south, this doesn't solve any of PCCW's major problems. "The existence and now the removal of the (Cable & Wireless) share overhang are technical issues and have no impact on (PCCW, news, msgs's) long-term fundamentals," Salomon Smith Barney said in a report. PCCW is still suffering from heavy debt, a disappointing net loss for 2000, an aggressive Internet strategy that burst together with the technology asset bubble and ambivalence in the investment community over management's vision and ability to pursue goals. "PCCW is a hated stock. It was loved and adored a year ago, but it's hated now," Robert Conlon, chief investment officer at Investec Asset Management Asia Ltd., said in an attempt to put PCCW's steep drop Tuesday in perspective. (Corrected 7:42 AM) quicken.com