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Technology Stocks : (LVLT) - Level 3 Communications -- Ignore unavailable to you. Want to Upgrade?

To: flint who wrote (3147)	1/29/2002 5:10:49 PM
From: Yogizuna	Respond to of 3873

SI's charts are really having problems lately, so I could not view your chart link.... On my chart, LVLT now to a hold from the previous buy signal on the daily chart. I use slow stochastics, candlesticks, trend lines, some pattern recognition, bollinger bands, moving averages, etc, etc.

To: flint who wrote (3147)	2/2/2002 6:25:07 PM
From: flint	Respond to of 3873

$1.21 to go. rockymountainnews.com Up and Down 17th Street: Level 3 executives haven't yet come clean All those who still put their faith in Level 3 -- the investors who remembered the $120 share price, listened to management and agreed the company was undervalued -- got their reward this week. CEO James Crowe and the company's executives finally admitted, indirectly, that Level 3's prospects are far worse than they had been claiming. The evidence was the writedown of the value of the company's assets by $3.2 billion. Forget the Wall Street analysts' hooey about how the writedown was, for the most part, is a "non-cash" charge. When a company writes down its assets, it's admitting a dramatic decrease in the future cash flows those assets were supposed to produce. Anyone who's watched the telecom shakeout the last several months shouldn't be surprised. The only question is why it took Level 3 so long to come clean. Qwest -- which has a terrible reputation on Wall Street these days for lack of honesty -- wrote down its European broadband assets in the second quarter when it took its own $3 billion-plus charge. Level 3 investors have been buying the stock based on third-quarter financial statements that said the company had $14.25 billion in assets to cover $11.13 billion in liabilities. That's more than $3 billion in shareholders' equity. Well, now you've got a company with negative shareholders' equity of $65 million. It means that you can sell Level 3's assets and you won't have enough cash to cover the liabilities. That's a recipe for bankruptcy. Crowe told analysts Tuesday the company's network still has "significant value" but Level 3 no longer can assume it can use all 12 fiber-optic conduits it stuck in the ground at a cost of billions. He didn't explain why the company figured this out now, rather than sooner, and a company spokesman declined further comment. The company's accounting policies, on file with the Securities and Exchange Commission, say the company reviews the value of its assets "whenever events or changes in circumstances indicate that the carrying amount may not be recoverable." Amazingly, Crowe told analysts this week that Level 3 can survive until 2004 without additional investment. Really? Look at the balance sheet. The company is still burning money: It had $2.5 billion in cash and marketable securities at Sept. 30; that number was $1.5 billion at Dec. 31. Level 3 has a $650 million bank credit line it can draw on. But the company says it could violate its bank loans in the second quarter, so it will have to go the bargaining table with the lenders. It remains to be seen if the company's credit terms remain as generous as in the past, particularly since Standard & Poor's downgraded the company's overall credit rating Wednesday to "junk." Crowe says Level 3 also can sell assets, like its toll road and coal mine, to raise about $500 million in cash. We're supposed to be comforted? This is not a going-out-FOR-business sale, it's a going-out-OF-business sale. The company's executives, to their credit (or detriment), still believe in the company. Level 3's purchase of debt late last year was an especially bullish move, since they expended precious cash to retire debt that didn't come due until 2008 at the earliest. But there's $6.2 billion of debt on the books, hundreds of millions of cash lost each quarter in operations, and no clear sign that spending on Level 3's products will make a comeback this year. "Longer term, we certainly remain optimistic," Crowe told analysts Tuesday. Of course, the economist John Maynard Keynes said that in the long run, we'll all be dead -- and it won't take nearly that long before Level 3 perishes. News finance reporter David Milstead take turns writing Up and Down 17th Street. Have a news tip