Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: SKIP PAUL who wrote (173)	1/6/1999 8:07:00 PM
From: straight life	Read Replies (1) \| Respond to of 2737

Still; in this market stocks selling at book are rare as gryphons.

To: SKIP PAUL who wrote (173)	1/13/1999 7:33:00 AM
From: Jules Shear	Read Replies (1) \| Respond to of 2737

Just a few thoughts on why LWIN is valued at around book value... 1) No take-over premium compared to other wireless companies like WWCA, CLNTF, OMPT, etc. Only possible buyer is QCOM who just spun them off. Given the LWIN has chosen to pursue a different business model (which I think has merit, just no proof yet), who would want to buy it? 2) Fixed wireless has not proven successful (from investment perspective) anywhere. Unless your name is Alex and came from ATT and can hype your stock (TGNT), I think it is difficult to get attention. 3) LWIN is currently misunderstood. Are they a "consulting" company to help QCOM or are they an operator? They can call themselves an operator, but until they start adding subs and look at using other vendors than QCOM-I think that it is a stretch. ATI owns "millions" shares and warrants of QCOM-but definitely does not use QCOM as an exclusive vendor or technology. I think "the street" sees LWIN as only a QCOM off-shoot to help QCOM succeed in their struggling infrastructure business and promote CDMA technology. Not that this is bad-but it just makes it difficult and uncertain on how to value. Both difficulty and uncertainty are not good words on Wall St. 4) How do you value fixed wireless licenses in Third World countries? While there is clear models to value mobile licenses-placing a clear $$ value on some of LWIN's holdings (above book) is difficult. 5) Confusion around the Nextwave relationship and LWIN. I think I speak for many on this one. 6) Management is "separate" from QCOM-but most are from QCOM. I have a hard time seeing Harvey White telling Irwin that QCOM did not win the CDMA contract in place xx due to a better bid from NorTel, Motorola, etc. Also, management has lots of CDMA expertise-but what about operator expertise? I am a fan of LWIN and hope they survive and do well, but I think it is going to take time for people to see the value. For example, ATI was one of the first pure play wireless companies when it spun off from Pacific Telesis for $23 in 1994. After two years, the stock was still stuck in the high-20's. However, as everyone knows-today it is at $80 once people figured out how to value ATI and the value has definitely become recognized. Patience will be rewarded-but it will take time and faith that LWIN will be able to execute and be more than a "consulting" company to help promote QCOM. I would like to hear other opinions on this thread.