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To: LK2 who wrote (1465)	2/23/1999 9:29:00 PM
From: LK2	Respond to of 2025

*OT*An example of how fluid stock valuations/prices can be. The article below shows one analyst valuing Amazon at $400, while another analyst at the same time was saying Amazon was worth $50. Or if you read Barron's current issue, Feb 22 edition, you can find one article that explains how closed-end funds were priced above net asset value back in the 1920s, and now they regularly trade below net asset value in the 1990s, and Wall Street could justify the premium and the discount equally well. Also, this week's Barrons has a nice, short article on how wildly stocks can be "overvalued" in different periods of history. RCA was priced at over $500 a share in 1929, when it was a hot stock with a "great future." By the 1970's, the stock price was like $80, long after the company actually started making money. Stock prices can be extremely fluid. And valuation models can be fluid as well. For Personal Use Only >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> biz.yahoo.com Tuesday February 23, 8:35 pm Eastern Time Merrill set to name Internet bull as key analyst By Eric Auchard NEW YORK, Feb 23 (Reuters) - Merrill Lynch (NYSE:MER - news) is expected to name CIBC Oppenheimer analyst Henry Blodget as its lead Internet stock analyst, replacing the recently departed Jonathan Cohen, who had acted as Blodget's nemesis in recent Wall Street debates over how to value the volatile sector. Blodget, who as an analyst at CIBC Oppenheimer became widely known on Wall Street for bullish investment calls on the emerging sector, has left the firm to take a similar role at Merrill Lynch, CIBC spokeswoman Debra Douglas said Tuesday. A Merrill spokeswoman declined to comment on whether the investment bank had hired Blodget for the high-profile spot. The personnel shift could signal a sea change in how the largest U.S. brokerage, and the millions of retail customers it advises about investment choices, assess the value of the wildly traded technology sector. A banker at another New York investment firm said the shift that Merrill's expected move would represent indicated the continuing ambivalence Wall Street has to speculative Internet stocks and their stunning price gains. ''There's so much attention given to analysts in this position,'' the Internet banker said of the high value investors put on research that can predict future financial results. ''It emphasizes the enormous uncertainty of the advice.'' Both analysts covered a similar group of companies -- names like America Online Inc.(NYSE:AOL - news), the dominant Internet services company, Amazon.com Inc.(Nasdaq:AMZN - news), the leading Internet retailer, and Yahoo! Inc.(Nasdaq:YHOO - news), the most popular destination on the Web. But the analysts have come to represent nearly 180-degree opposing views on investing in such companies. Cohen was known at Merrill for his cautious optimism over the years, and recent warnings that such stocks have become overvalued by any traditional measures such as stock price-to-earnings or price-to-revenues ratios. For years he questioned the viability of America Online as an investment, but in a sudden about-face two years ago made AOL his top investment pick. The stock, which had been suffering from network overload and questionable accounting, has since seen its stock price spiral. Blodget came to symbolize an opposing camp when, in a December report on Amazon.com that attracted wide attention, he set what appeared to be the astronomical 12-month target price of $400 on the stock, which was then trading just above $200. In response, Amazon.com stock exploded nearly $60 in heavy trading the day the report was released and sailed past his $400 target within 12 days, amid a flurry of speculative buying that took hold throughout the sector and carried into January. The stock hit a high of around $600 before settling back. Amazon.com, which in the intervening period declared a three-for-one stock split, closed Tuesday at $115.19, up $8.69 on the day in heavy Nasdaq trading -- $345 adjusted for pre-split prices. Blodget emphasized the long-term growth prospects of the leading Internet retailer and embraced alternative methods for valuing its revenues, where Cohen has seen warning signs. In his Amazon.com report, Blodget's new target price of $400 was based on several models using sales as well as expected earnings five years down the line. Earlier this month, Cohen left Merrill to head up a new equities research group at Wit Capital, an Internet-based investment bank headquartered in New York. In a thinly veiled rebuttal to Blodget, Cohen had argued in early January that Amazon -- far from being worth $400 -- was worth less than $50, or below $16.50 when adjusted for the subsequent stock split. Copyright © 1999 Reuters Limited. <<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<

To: LK2 who wrote (1465)	2/23/1999 10:41:00 PM
From: Mark Oliver	Read Replies (1) \| Respond to of 2025

Larry, it's not my intention to say you are right or wrong. I was just throwing in my 2 cents. I find the lack of customers, competition, government barriers and questions about how long it will take to get ROI is concern. At the same time, they've got a pretty unique asset in their network. Eventually, it looks like the coolest thing possible, but in the meantime is it ahead of the market? Like you say though, this company is way off it's high and may be a good value. I really can't comment on that. Just another word of caution. I invested in MMMDS, which also seemed like the coolest thing ever. Imagine a station that could transmit in 30k cells, sending both TV and internet to a dish about 30" in diameter. Then imagine they can send speeds around 5megs, 2 way. Then, add in the fact that areas have to be licensed giving the holder control over competition, and the equipment for a station is less than $300K. This company had licenses for St Louis, Detroit, Phoenix, Chicago, Salt Lake City and some others I forget. So, what could go wrong? The FCC. The FCC has blocked the rollout of digital, both one way and 2 way, and only allowed one way analog which only works for TV. From everything I could find, the technology works, they just can't get regulatory go ahead to install. The politics here have been very favorable for landline, high cost systems like RBOC's and cable companies. In fact, faced with a cherry picking technology like this, you'd have to wonder how they could afford to spend billions on ADSL and Hybrid Fiber Coax? Very curious. So, now you have a venture which would break all the holds telecom monopolies have around the world, and you don't think there will be resistance? Again, I haven't done enough leg work to comment on specifics of Iridium, but that's never stopped me before :). This is just discussion and I'm willing to learn. It certainly is a great asset even if it takes longer to get going than expected. Regards, Mark