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Technology Stocks : Leap Wireless International (LWIN) -- Ignore unavailable to you. Want to Upgrade?

To: Pierre who wrote (1261)	2/6/2002 11:10:04 AM
From: pcstel	Read Replies (1) \| Respond to of 2737

Pierre: We will see.. I just bought 3K at $7. I am not one to margin.. But, it does look tempting at this level. But, I decided to refrain from such foolishness. PCSTEL

To: Pierre who wrote (1261)	2/6/2002 11:56:41 AM
From: pcstel	Read Replies (1) \| Respond to of 2737

I'm assuming you're not laying down a $52,000 bet because you expect the stock to climb on its own. Of course I do.. I mean LWIN has been brutalized the most, is the only one of the carriers that have exceed their guidance. Talk about throwing out the Baby with the bath water! All I can say is that I am at a loss for words! I mean all the analysts say. Well the great thing about Airgate is that they have this High Margin Roaming income every month from Sprint! (Of which they have to pay 8% back to Sprint) I just shake my head. Airgates Roaming Revenue has over 50% margins over Cost of Service! Their native Operations are barely over 20% margins over Cost of Service. LWIN's margin is over 50% on all of their subscribers as an average! I mean I sit here and look at my Spreadsheet and say. Gee! What are they going to do with all of this money? Personally, I think Harvey will shock a few people at the CC. Because I would be surprised if this current quarters EBITDA loss is in excess of 30 million. They might even be able to get it into the teen's depending on how they sharpen G/A Expenses. Harvey is doing the right thing by starting to count pens in the Office Supply closet when they have 450 million in Cash and Reserved Cash in the Bank given current market conditions. Not when they only have 20 million. This is one of the easiest companies to model.. The accounting is "clear cut" and simple. You know what their CPGA is targeted to be. All you need to know is what the net subscriber additions are projected to be by management.. Really the only variable is the G/A Expenses. By sticking in the net additions you know what their marketing and selling costs are budgeted to be (Since all of the pre-launch expenses are behind us). in combination with the Cost of Equipment. You use $109 for the average cost of equipment. Stick in the subscriber additions, and the rest of the numbers come out. Or at least they have for the last 4 quarters I have modeled. In addition, since they have now filled the distrubution channels in all of their markets. Cost of Equipment drops way off, and the quarterly Cost of Equipment expenses becomes a direct ratio to subscriber adds. Here are the numbers for a net addition of 250,000 this quarter. Net Subscribers..1,369,000 Net Additions...........250,000 $ in 1,000 Equip. Revs..........12,000 Service Revs.........123,156 Total>>>>>>>......135,156 Covenant...............120,000 Cost of Service......57,224 Cost of Equip.........26,000 Selling+Marketin...36,000 General / Admin....38,000 EBITDA loss........(22,069) With another 250,000 additions in Q2 and a little throttle back on G/A expenses. We should be EBITDA break even. With over 400 million in Cash and Reserved Cash. With another 250,000 additions in Q3. We are generating positive 35million EBITDA to service Interest costs of 58 million. At the end of Q4 with 2 Million subs. We are at EBTDA break even. Do I expect this stock to climb due to this company being EBITDA postive at the end of Q2 according to my spreadsheet? With that kind of Cash in the Bank? Yes. PCSTEL