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Technology Stocks : Winstar Comm. (WCII) -- Ignore unavailable to you. Want to Upgrade?

To: David P. Stark who wrote (5527)	4/28/1998 12:07:00 AM
From: Jason Cogan	Read Replies (1) \| Respond to of 12468

<<We should all want to hear both sides. When someone says the empeor has no clothes then I say lets take a peak.>> Hear Hear Mr. Stark: Well said. I agree wholeheartedly. Pay attention to this man's wisdom, Steve Squared and Six Consonants (Sounds like a Rock Band for the Insane). Throw away your bitter temperaments and mean spirited analysis. No matter how many clever yet insulting poems you write (SteveG), or absolute garbage you attempt to scribble (pknwnk, aka Six Consonants), only Ostriches hide their head in the sand. Winstar does have a "potentially" bright horizon. There is also tremendous uncertainty ahead, both for their earnings estimates and their competitive position. This doesn't mean they won't be successful, but the odds are far from a slam dunk. Most importantly, as I'm sure most of us non-ostriches realize, unbelievable uncertainty swarms around their balance sheet. Despite the thinly veiled insults (SteveG, I'd venture to say I've bought and sold more stock than generations of your family), I still believe many of you, such as Mr. Stark, Mr. Ferguson, and Mr. Levy, value a contrarian opinion. The rest seem content with requests for holy intervention. "Dear God, If only we could find a legitimate bear case, then our mission would be complete. Until then, we continue to pray to the God of Rouhana." I think rather than wishing for a "legitimate bear case", those of you with doubts should be requesting a "legitimate bull explanation" for the $2 billion of spoken capital. How bright does your future have to be to dig yourself out of a $2 billion dollar hole? I'll admit upfront, I don't know the answer. I could run some DCF projections for the next 36 months, as limtex requested, and tell you my estimates, but I don't think that would be really fair to Winstar. We know they're going to lose money for the next 36 months. The company and all the analysts have admitted it. So how good would Winstar look then? The $2 billion deficit will only be larger. I'll also admit upfront, I don't know how credible my model for predicting revenues would be. I for one don't have the insight into how many lines Winstar "plans" to install, nor how successful they will be at implementation. A lot depends on the customer, size of business, the quality of service, billing, customer support, and variety of services. What's more, none of us can really predict what the cost of telecommunications services and margins will be, if and when Winstar ever turns profitable. I used $20 per month per customer as a convergence estimate. Wrong? Possibly. But my guess is that a communications consolidator would be happy to provide access to everyone one in the building for $20 a month per person. That is after all what Winstar is attempting to become. I certainly think prices for bulk access will come down, as increasing competition and technological advancements throws more value into the hand of the consumer. Where do I stand on Winstar? I was pretty upfront when I started here, despite the quick criticisms and unfriendly response. When I come right down to it, I think there's too much risk in the stock. Starting from a $2 billion hole is an awful lot to overcome, especially when you're banking on cash flow from a bridge that may not materialize in the way you imagine. To the Ostriches, Steve Squared and Six Consonants, you are aware that you are buying equity, aren't you? Not first rights to any of the cash flow Winstar happens to generate. Does this fact alone make the equity a good short? I don't know. The last four points since I started posting are some indication, but I'm too superstitious and experienced in the market to start gloating yet. Regards, Jason Cogan

To: David P. Stark who wrote (5527)	4/28/1998 10:16:00 AM
From: silicon warrior	Respond to of 12468

david: I agree wholeheartedly. My present faith in wcii is so great that i have committed an imprudently excessive amount of my net worth to it. As a result, I endured great anxiety just one year ago. We have had a very terrific run, and the analyst reports, forecasts and valuations are very encouraging. Moreover, the company's performance measured against realistically optimistic landmarks has been excellent. The rollout seems to be a great success. Now, we need to see the EBITDA losses decline for the quarter, at least absent extraordinary items of a favorable nature--e.g., unexpected expenses due to unpredicted opportunities. If we can hit those landmarks, more and more investors will recognize the value here. Meanwhile, we have the leisure of some industry player potentially paying for that value as well. --i hope...When i hear good reasoning from the bears, i have every reason to protect myself, as do the rest of us. However, some of our "bears" are sometimes just engaged in trash talk which even they cannot possibly endorse.. PS:My screen says the clecs are popping...maybe jason was a help?? Yeah, I'm with you steve--writing naked calls against a stock that's an acknowledged desirable deal candidate?? There's more risk in that than the downside in our equity, though the odds favor jason--what is it, 80% of all options expire worthless??