With the field of small telcos rapidly becoming a
|'GigE,' the Next Big Thing in Telco Land|
Fitness to ServeIf you believe the believers, the three fittest survivors are Time Warner Telecom ( TWTC, McLeodUSA ( MCLD and Allegiance ( ALGX. Shares of all three rallied sharply Tuesday and again Wednesday during a marketwide updraft: Time Warner Telecom jumped $3.24 to $43.90; McLeod added 28 cents to $9.25; and Allegiance added 76 cents to $16.01. Time Warner Telecom, a 44%-owned affiliate of AOL's ( AOL Time Warner unit, and Allegiance were founded by ex-MFSers. CLECs are the would-be Bells. Typically they target businesses with a laundry list of services from local calling to high-speed data lines and private networks.
|Learning Tree? |
CLEC execs not falling far from the MFS tree
|Source: Royce Holland, Chairman, Allegiance Telecom|
|Balancing Act |
Profits in sight for some telcos
|Company||Stock||Debt*||2001 Debt Expense**||2000 Cash Flow***||Profitability target|
|Time Warner Telecom (TWTC:Nasdaq)||$40.66||$585M||$126M||$139M||2003|
|Winstar (WCII:Nasdaq)||36 cents||4.2B||651M||-461M||--|
|*Total debt and preferred stock. **Estimated payments on interest and preferred dividends. ***Operating cash flow before expenses. |
Source: Lehman Brothers, companies.