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CommNet Cellular

has found the profits. Now its New Year's resolution is to boost investor interest.

While splashier, big-picture cellular players such as

Airtouch Communications

(ATI:NYSE) grab attention, CommNet has quietly built a large geographical position by gobbling up cellular licenses in rural areas throughout nine western states.

Having succeeded at building its business among the dirt roads of Western America, CommNet is now adding on new services. That, combined with the prospect of further share repurchases, could make for a more bullish 1997.

CommNet plans to roll out a new data service in the first quarter. In addition, the company is expected to continue to repurchase its own shares. Since mid-summer, CommNet has bought up about $4 million of its stock as part of an authorization to repurchase $20 million. CommNet stock has wavered between 26 and 35 since July, and traded at just under 28 on Tuesday.

Still, CommNet Chief Executive Officer Arnold Pohs remains cagey on the buyback issue: "There are too many (market and competitive) variables to predict" when the company would repurchase shares.

David Freedman, an analyst at

Bear Stearns

said a repurchase would not surprise him. "They were already buying them at these levels," he commented. Freedman has a neutral rating on the stock. Bear Stearns has not done any investment banking work with CommNet.

CommNet's new data service system also comes with a great sales pitch--farmers can finally sleep late. CommNet techs are busy rigging their new data service system to allow users to activate certain systems via remote control. Such a system would enable farmers to trigger irrigation systems while snoozing.

The company is using software from


TheStreet Recommends

(BLS:NYSE), dubbed Cellemetry, which could spawn many similar applications. CommNet also intends to deploy paging services sometime in 1997.

And the looming threat of PCS companies could, ironically, funnel more revenue toward CommNet. PCS providers such as


(OMPT:Nasdaq) and

Sprint PCS

are launching services next fall. But they are focusing most of their fire power on shorter-range transmitters in urban environments. So when PCS customers travel through the countryside, they will pay CommNet a handsome "roaming" surcharge for using its system.

Pohs, who joined CommNet's predecessor in 1986 as it went public, waxes upbeat about his market position. "You know me. The glass is always half full, not half empty."

And CommNet finds itself creeping into the black. In the fourth quarter ended Sept. 30, CommNet's consolidated service revenue jumped to $36.1 million, up from $26.3 one year earlier. In the same period, the company turned a net loss of $1.5 million, or 12 cents per share, into a profit of $4.7 million or 34 cents per share. The fourth quarter 1995 net income figures disregarded nonrecurring and extraordinary items.

Freedman at Bear Stearns says he would consider boosting his rating on the stock if the company continued to show solid earnings in the next fiscal year. And, he adds, "they're getting very close to that."

While CommNet faces few if any large-scale rivals in its own geographic territories, such carriers as

Palmer Wireless

(PWIR:Nasdaq) and

Vanguard Cellular

(VCELA:Nasdaq) also operate in less densely-populated regions.

By Kevin Petrie