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Strategies & Market Trends : The Round Table: A work by the squares of the SNDK thread. -- Ignore unavailable to you. Want to Upgrade?

To: Ausdauer who wrote (35)	3/11/1999 12:22:00 AM
From: Bill Zeman	Read Replies (1) \| Respond to of 194

Aus Oh oh. Your questions are getting harder and harder to answer as you research it more. I also fear that it may be too late to get IDTC at a very good price for a while in light of today's price action, (19 5/16), up 25%! Anyway, I'll give it a try. Aus said, "The D&A costs are used rather than littering the earnings reports with one time charges? Is that a correct assumption??" I think so. I don't see any other way they could be accounting for what I know to be rather substantial outlays of capital. Keep in mind margins will improve when their network is more built out, because their cost for routing calls will be so much lower. right now they are still using a lot of leased lines and even the spot market which is most expensive. They have got more business than they can handle. Problems we like to have. The divergence of revenue and earnings will discontinue. this is sure. Aus said, "The Net2Phone concept is intriguing. What are the barriers to entry?" You lost me a little bit here. I don't think I know what you mean by "barriers to entry". If you mean breaking into the market, they already have. There are over 1 million users of Net2Phone, (of which I am one), and it is adding millions to their top line every quarter. Aus said, "Seems like the Netscape announcement after the bell yesterday may be good for a strong move up today." Doubtless this helped in today's move, but the biggest driving force between the last 3 day's move up from the high 12's to 19 and change must be understood as enthusiasm for the upcoming IPO spin off. SEC regs have kept the lid on the details until now but they did have a bond holder's consent agreement due to be resolved today, and it is my hunch that quite a bit of big money is favorably viewing the presumed or even known details of the plan. This brings me back to one of my opening comments. IDTC is so high now that it is almost not even a value play now and I think probably contradicts my #2 rule. That said, I believe it will see 30 very shortly and will not sell any of my already very profitable position until then. I am not going to buy anymore either though, not unless we see a flux back down to 12 or so. Bill Zeman