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

To: SteveG who wrote (10331)	2/17/1999 3:29:00 PM
From: SteveG	Respond to of 12468

BTAB - HIGHLIGHTS: -- WinStar completed the previously-announced acquisition of Macrocom SA. Macrocom holds a nationwide license for 400 MHz of spectrum at 38 GHZ in Argentina. -- POSITIVE NEW NEWS: WinStar expects to launch wireless local loop services in Buenos Aires (12MM POPs) by 3Q 1999. Argentina represents the second international market for WinStar (the company announced a joint venture with the largest international telco provider in Japan earlier this year with services expected to commence in 2Q 1999). We believe WinStar paid approximately $0.05/channel POP, or about $4.5 million (22MM POPs x 4 channels x $0.05). We note that in the U.S., the 150-MHz B-Block auctioned in last year's LMDS auctions drew an average bid of $0.67/POP. -- NEGATIVE NEW NEWS: While the timing may have slipped a little from our original expectations of a 1H 1999 launch in Latin America, we would continue to expect some "lumpiness" in the timing of international market rollouts. -- STOCK PRICE PERFORMANCE: YTD, WCII is down 7%, versus a 0% movement in the S&P 500 and a 13% gain in our CLEC Index. -- NET-NET: WinStar will draw on its $2 billion vendor facility/strategic relationship with Lucent Technologies to build out these networks. The company also raised $175MM this month in a follow-on equity offering of 4.2 million shares. WinStar remains well funded to build out its international and domestic broadband local networks, and is aggregating spectrum rights throughout Europe to round out its international portfolio (Europe, Asia/Pacific, Latin America). We expect the company to make announcements regarding incremental partnerships in these regions throughout 1999. -- VALUATION: Based on our 10-yr DCF, using a 20% equity discount rate and a 10x terminating multiple, our 12-month price objective for WCII is $64/share. Reiterate "strong buy" rating.

To: SteveG who wrote (10331)	2/17/1999 3:48:00 PM
From: SteveG	Read Replies (1) \| Respond to of 12468

It was not unknown that Schmeig understandably wanted to run his own show. Schmeig who has been overseas for quite awhile did a great job in setting up WCII USA and then in getting WCII Europe prepared, but Schmeig's strength is as a telco (circuit) guy, not a data (packet) guy. WCII's foreign market strategy is building a data network. WCII's Kathleen Flaherty (from MCI) is purportedly one of the more seasoned datacom people around. She is heading up the data effort in Europe. Gary Scheckle (sp?) is heading up WCII's data effort in South America and Asia. Purportedly, WCII will be hiring a senior datacom person who will oversee the build of this data strategy.