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Technology Stocks : Loral Space & Communications -- Ignore unavailable to you. Want to Upgrade?

To: Thomas who wrote (1810)	1/30/1998 12:42:00 PM
From: Snake	Respond to of 10852

Agree with you 100%. I used 5.5 EBITDA multiple only as benchmark, since the company was separately valued last year, and this is what is valued at. 5.5 seems low and could be higher based on a number of findings, but would have to be 20 to justify, all other things being equal, the decrease over the last day or so. Does kind of blow though, G* hit 57 1/4 today, with little benefit to LOR over the last few days. Could be people moving from Loral to G, but G has low volume.

To: Thomas who wrote (1810)	1/30/1998 12:44:00 PM
From: Valueman	Respond to of 10852

Thomas: You would think that with the barriers to entry in the sat manufacturing business that SS/L would be worth a great deal. This is obviously not the case. I think it stems from the fact that it is labor and capital intensive--a ton of engineers(they are not cheap I am sure) and a great deal of expensive equipment(I can't imagine that one of those giant thermal/vacuum chambers is cheap). These expenses make it a very low margin business. SS/L has said that it is extremely difficult to expand capacity, mostly due to a lack of human capital(that raises the question about those 300 layoffs). So, you can also throw in the fact that it is no where close to a growth business. All these factors combine to make the valuation we see fair.