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Technology Stocks : NEXTEL -- Ignore unavailable to you. Want to Upgrade?

To: Rob Prickett who wrote (3245)	11/17/1997 5:29:00 PM
From: Bernie Diamond	Read Replies (1) \| Respond to of 10227

Rob, as requested... 1. MS (10/3) Reiterating strong buy rating. Increasing sub additions for 3Q97 to 300K from 225K and 4Q net adds to 275.9K from 150.9K. Expect ARPU around $65. EPS 97E $(4.55). EPS 98E $(4.13). Domestic Operating Cash Flow (EBITDA) for 1998 could be positive...potentially positive operating cash flow for full-year 1998...YE 1998 target of $35 per share is based on a detailed discounted cash flow analysis, and implies potential upside of over 30% from current trading levels. 2. VL (10/10) Timeliness 3 (average); Safety 5 (lowest). EPS 97E $(4.35). EPS 98E $(3.85). 2000-02 projections high 50 to low 30. Nextel's ARPU was about $63 in June Q compared to about $48 for the cellular industry in 1996. Increased competition is always a concern in the wireless industry. Possible that one of Nextel's deep-pocketed rivals could come up with a similar feature though it would probably take a few years to develop and implement.. These shares are ranked to mirror the year-ahead market. Solid ARPU results and subscriber growth seem likely to continue, at least in the short term. However, investors should note the volatility and safety rank (5; lowest) of this issue. 3. BT Alex, Brown Research (10/10-16) Initiating coverage with a "strong buy" rating - - $38 18-month price target (based on a 25% discount on our $51 private market value estimate. INVESTMENT HIGHLIGHTS - a unique service offering; large target market: high-end, high volume business user; strong operating fundamentals and trends; capital-efficient buildout; financing is completed; seasoned mgmt; extremely valuable strategic and equity sponsorship; attractive international wireless portfolio. The early risks to the Nextel story are seemingly resolved. 1.1 M subs at YE 97. Estimate 11.2 M subs by 2006. ARPU will peak in mid-$70's and decline thereafter as the company attracts more casual users. EBITDA approximately 49% in 2006. 4. JP Morgan (10/14) was a telecommunications review and did not have Nextel projections. Sorry. later, Bernie