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 : NEXTEL -- Ignore unavailable to you. Want to Upgrade?

To: Anthony Wong who wrote (8964)	3/29/1999 10:48:00 PM
From: Frederick Smart	Respond to of 10227

Our Government Opens Up!! >>The General Services Administration last week awarded Nextel Communications Inc. a contract potentially worth several hundred million dollars to support wireless communications across the government.>> This is huge! Uncle Sam and his closed system are in for BIG change - all positive - when these phones start virally working their magic within the bureaucratic bowels of administrative water-coolerdom. Beware coffee and cigarette breakmasters and masters of the expanded powerlunch at the local deli. DC is going DC. Luke Skywalker meets Darth Vadar. The force will be forced to see the light. Chirp, chirp, chirp.....info share is info squared. Efficient energy will find areas that aren't necessary. Time will get compressed. Lights will go on in the minds of the comfortable protectorate. Walls get lowered. Fewer obstructions. More access. More fluid movement of ideas, good and bad. May the good rule and the bad be arbitraged out of existence. C-SPAN, e-mail, the internet and now DC. It's called progress. Congratulations Nextel!

To: Anthony Wong who wrote (8964)	3/30/1999 1:00:00 AM
From: SteveG	Respond to of 10227

nice find Anthony. Fwiw, here's another BTAB PCS auction report: HIGHLIGHTS: -- The re-auction of PCS frequencies continues after day 4 (26-Mar). After 8 rounds of bidding, the auctions have yielded net bids of $228 million. Early results, while not terribly significant, are nonetheless interesting (please see our note dated 22-Mar for identification of the top 10 qualifying participants). -- TOP FIVE BIDDERS BY NET BID (we note that an entity's bid amount can fluctuate (wildly) from round to round--as opposed to necessarily rising each round--if it loses a high bid position) Bidder Markets Bid ($Mil) Cook Inlet/VoiceStream PCS 21 127.9 ABC Wireless 36 14.8 Leap Wireless 9 12.8 Beta Communications 2 9.0 Pegasus PCS Partners 1 7.6 Source: Federal Communications Commission. -- TOP FIVE MARKETS BY NET BID Market Bidder Bid ($Mil) Bid/POP Chicago (30MHz) Cook Inlet/VoiceStream 61.9 $7.55 Dallas (30MHz) Cook Inlet/VoiceStream 39.1 $9.05 St. Louis (30 MHz) Cook Inlet/VoiceStream 11.7 $4.30 Philadelphia (15 MHz) Cook Inlet/VoiceStream 11.6 $1.96 Phoenix (30 MHz) Beta Communications 8.8 $3.70 Source: Federal Communications Commission. -- RECENT BIDDING ACTIVITY BY ROUND New Net % Eligible Round High Bids Bids Chg. Bidders 5 60 $159M 11% 67 6 75 $183M 15% 63 7 50 $210M 15% 63 8 43 $228M 9% 63 Source: Federal Communications Commission. -- NET-NET: The auction is showing its first signs of slowing down with net bids showing a single digit increase for the first time. However, plenty of bidders remain, and plenty of bidding credits remain eligible so it's likely still too early to draw any definitive conclusions. Chicago and Dallas continue to draw the most bidding attention, and represent the top two bids on a per-POP basis at $7.55/POP and $9.05/POP, respectively. This compares with an average of $1.00/POP in for markets with an active bid so far, and along with St. Cloud, MN, represent the only markets over the $5/POP level (so far)... Stay tuned.

To: Anthony Wong who wrote (8964)	3/30/1999 1:05:00 AM
From: SteveG	Read Replies (2) \| Respond to of 10227

and... "NXTL: It Is A Scarce Asset" (again by BTAB's wireless telecom analysts Jeff Hines and Bo Fifer) "Strong Buy" HIGHLIGHTS: -- Nextel shares rose over 12% on Friday (26-Mar) on very heavy volume. Some recent corporate news would be as follows: 1. Debt ratings raised. Standard & Poor's recently (19-Mar) raised the ratings on several pieces of Nextel debt (Nextel's corporate credit and bank loan ratings to "B" from "B-", and the rating on senior unsecured debt to "B-" from "CCC+", and Nextel's preferred stock to "CCC" from "CCC-". These "C" to "B" moves are quite positive in the debt markets, often allowing a wider potential investor base to own Nextel related debt. 2. Management changes at international unit. Nextel appointed Steve Dussek as President and COO of Nextel's 99% owned subsidiary Nextel International. We have noted that Nextel International is one area where the Company has lagged versus our expectations and view the move of Mr. Dussek (a wireless veteran, who had been President of Nextel's West Division) to run the international operations as a positive. 3. GSA contract win. Nextel recently won a government contract to supply wireless phones to several government agencies (FBI, CIA, etc.). 4. Ericsson/Qualcomm pact highlights 3G. Last week's announcement regarding Ericsson and Qualcomm should streamline the process of developing a third generation (3G) wireless platform which incorporates high-speed data into the mobile voice platform. Advances through 3G technology are likely to result in greater penetration and higher usage for the wireless service providers. The announcement firmly highlights what telcos are looking for in next generation wireless technologies, i.e., additional capabilities based on data/Internet platforms. In that vein, Motorola's iDEN technology (what Nextel, Clearnet, et. al.) are currently using, is well down the path of offering if not 3G, perhaps 2 1/2 G, wireless services as was evidenced by a recent Nextel / Motorola / Netscape / Cisco / Unwired Planet announcement. We would look for both Nextel and Clearnet to roll out wireless data based services using the new i1000plus data/Internet capable phone later this year. -- STOCK PRICE PERFORMANCE: NXTL is up 60% YTD, ahead of our (also strongly performing) PCS Index (up 43%) and the S&P500 (up 4%). -- NET-NET: Investors, we believe, are beginning to realize the potential "center of the universe" position of wireless in the telecommunications marketplace. While much of the current focus has been on wireless's potential for carrying voice traffic (and thus providing an alternative at the local level), future 3G services will include high-speed data/Internet, video, etc. With a scarcity of wireless equity investments available, certainly a Western Hemisphere provider like Nextel has pieced together what is one of the premier footprints in the industry today, in our view. -- VALUATION: Our 12-month price objective is $42/share, based on our DCF. We note that we have heavily discounted Nextel's 99% owned subsidiary Nextel International due to a slow-ramp and uncertain financing plans. Should Nextel shore up financing at Nextel International and/or increase market penetration we would likely use a similar discount rate on these operations, which would imply a $46/share price objective. Stay tuned.