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

To: silicon warrior who wrote (8675)	10/13/1998 6:40:00 PM
From: SteveG	Read Replies (2) \| Respond to of 12468

Steveg is out of town and asked me to post these comments by Governali: WCII: Strong 3Q Access Line Additions CREDIT SUISSE FIRST BOSTON CORPORATION Equity Research-Americas Industry: Telecommunications Services Frank J. Governali, CFA 207/780-6210 frank.governali@csfb.com Kathryn D. Littlefield 207/775-0776 kathy.littlefieldi@csfb.com BUY WinStar Communications (WCII) Summary WinStar reported third quarter access line additions of 60,000 compared with our estimate of 58,000-59,000. Sequentially, line additions were up 20% compared with 22% last quarter. WinStar ended the period with approximately 255,000 lines in service, up 30.8% sequentially versus 58.5% in the second quarter. There were 80,000 lines ordered during the quarter, implying a provisioning rate of about 75%. This compares favorably with an implied provisioning rate last quarter of 67%. Last quarter WinStar reported that 35% of its lines were on its own switches and 15% were connected to the switches by the WinStar radio technology. We expect both the on-net and on-switch percentages to improve this quarter. We also expect the line composition reported last quarter, with higher revenue data lines accounting for 20-25% of the total, will remain about the same. We are not changing our revenue or EBITDA estimates for the third quarter of $64.5 million and a loss of $47.6 million, respectively Our loss per share estimate is $2.84. Price Target Mkt.Value 52-Week 10/12/981 (Year-end) Div. Yield (MM) Price Range 15 $61 none None $ 571.5 48 - 10 Annual Prev. Abs. Rel. EBITDA/ EPS EPS P/E P/E Share 12/99E (10.68) NA NA (2.73) 12/98E (11.35) NA NA (4.99) 12/97A (7.68) NA NA (4.65) March June September December FY End 1999E (2.85) (2.81) (2.61) (2.42) Dec. 31 1998E (2.54)A (2.77)A (2.84) (3.05) 1997A (1.29) (1.85) (2.01) (2.50) ROIC (12/97) Total Debt (6/98) $1,658 mil Book Value/Share (6/98) NM WACC (12/97) Debt/Total Capital (6/98) 87% Common Shares 38.1 mil EP Trend2 Est. 5-Yr. EPS Growth Est. 5-Yr. Div. Growth 1On 10/12/98 DJIA closed at 8001.5 and S&P 500 at 997.7. 2Economic profit trend. WinStar is a competitive local exchange provider using 38 GHz technology to build out local telecom networks in major markets throughout the country. CREDIT SUISSE FIRST BOSTON CORPORATION CREDIT SUISSE FIRST BOSTON CORPORATION Analyst: Governali, F Telephone: (207) 780-6210 frank.governali@csfb.com CREDIT SUISSE FIRST BOSTON CORPORATION CREDIT SUISSE FIRST BOSTON CORPORATION This memorandum is for informative purposes only. Under no circumstances is it to be used or considered as an offer to sell, or a solicitation of any offer to buy, any security. While the information contained herein has been obtained from sources believed to be reliable, we do not represent that it is accurate or complete and it should not be relied upon as such. We may from time to time have long or short positions in any buy and sell securities referred to herein. This firm may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any company mentioned in this report. Copyright 1998, CREDIT SUISSE FIRST BOSTON CORPORATION WinStar Communications = = WCII:BUY CREDIT SUISSE FIRST BOSTON CORPORATION Copyright © 1996, 1997, 1998 CREDIT SUISSE FIRST BOSTON CORPORATION, All rights reserved.