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M A Y 2 0 0 7 T E L E C O M S T O C K :    R E C O M M E N D A T I O N Presentation to FIN 824 (SPRING QUARTER) Marc Reitter Siddhesh Sankulkar T E L E C O M S T O C K R E C O M M E N D A T I O N Telecom Stock Recommendation Overview: 1

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    1. M A Y2007 T E L E C O M S T O C K :   R E C O M M E N D A T I O N Presentation to FIN 824 (SPRING QUARTER) Marc Reitter Siddhesh Sankulkar T E L E C O M S T O C K R E C O M M E N D A T I O N

    2. Telecom Stock Recommendation Overview: 1 Sector Recommendation Recap 2 2 Current Holdings & Recommended Action 3 3 America Movil Overview & Analysis 4-10 MetroPCS Overview & Analysis 11-13 Company Risks 14 Action Recommendation 15 T E L E C O M S T O C K R E C O M M E N D A T I O N 1

    3. Sector weights – SIM vs. S&P 500 SIM overview: Maintain Overweight Position • Current holdings: • Current holdings: SIM overweight Telecom by 3.43% S&P 500 overview: T E L E C O M S T O C K R E C O M M E N D A T I O N 2

    4. Current Position – company analysis Current Holdings Source: Yahoo Finance & Bloomberg Recommendation T E L E C O M S T O C K R E C O M M E N D A T I O N • Sell Windstream • Sell Sprint • Increase position in America Movil • Buy MetroPCS Communications 3

    5. Company overview – America Movil • America Movil through its subsidiaries, provides wireless communications services primarily in Latin America. • Operations in 15 countries in the Americas • More than 124 million mobile customers • Dominant position in Mexico and Central America • Third largest Wireless company in Brazil (South America’s largest economy) • Coverage for a combined population of 770 million • Carlos Slim – Owns 65% of the voting rights of America Movil, also is the 3rd richest individual in the world. T E L E C O M S T O C K R E C O M M E N D A T I O N 4

    6. Catalysts – America Movil • Positioned well throughout Latin America to take advantage of Emerging Markets • America Movil's economies of scale help it squeeze operating profits out of every market in which it offers service. • Low penetration rates (approximately 43%) throughout Latin America means a cornucopia of subscribers are still out there. • Renewed focus on operating costs • Strict control over overhead costs • Growth via Acquisition • Looking to continue adding assets in the near term as this has been the means of their growth over the years • Recently acquired Verizon’s Puerto Rico operations • Carlos Slim T E L E C O M S T O C K R E C O M M E N D A T I O N 5

    7. Financial Analysis – America Movil T E L E C O M S T O C K R E C O M M E N D A T I O N 6

    8. Financial Analysis – America Movil AMX Relative to S&P 500 (SP5A) T E L E C O M S T O C K R E C O M M E N D A T I O N 7

    9. Valuation Analysis – America Movil T E L E C O M S T O C K R E C O M M E N D A T I O N 8

    10. DCF Analysis – America Movil T E L E C O M S T O C K R E C O M M E N D A T I O N 10

    11. Company overview – MetroPCS Communications • MetroPCS began trading on the NYSE on April 19, 2007 following the completion of the company’s IPO • MetroPCS offers wireless service that is designed to extend benefits of mobility to the mass market by offering wireless service that is: • Simple to understand and use • Priced competitively with traditional landline service • Service allows customers to make unlimited calls within a local calling area • MetroPCS boasts a differentiated low-cost wireless subscriber model with approximately 3.4 million subscribers. T E L E C O M S T O C K R E C O M M E N D A T I O N Source: Company reports 11

    12. Catalysts – MetroPCS Communications • Maintaining low operating expense is Key for MetroPCS success • Continue with the “Market Clustering” strategy in densely populated areas with limited cell sites which minimizes network expenses • Core Markets: Atlanta, Dallas/Ft. Worth, Detroit, Miami, San Francisco, Sacramento, Tampa/Sarasota/Orlando, and Los Angeles • Continue to minimize marketing costs with low handset subsidies, owing to the absence of service contracts. • Consumers pay flat monthly fee for unlimited use within service area • The company sells its products and services to customers indirectly through approximately 2,000 independent retail outlets under the MetroPCS brand, as well as directly through 95 company-operated retail stores • Continue with the “Market Clustering” strategy in densely populated areas with limited cell sites which minimizes network expenses T E L E C O M S T O C K R E C O M M E N D A T I O N 12

    13. DCF Analysis – MetroPCS Communications T E L E C O M S T O C K R E C O M M E N D A T I O N 13

    14. Company Risks America Movil • Country Risk Primarily in Brazil and Mexico • Brazil's local monetary policy is a bit nonexistent and its tax laws are draconian. • Lack of transparency in financial reporting is concerning. • Currency risk and associated inflation concerns throughout Latin America • Intense competition from Rival Telefonica (Acquired 2nd largest company in Brazil) • Rising penetration rates throughout Latin America MetroPCS Communications T E L E C O M S T O C K R E C O M M E N D A T I O N • Primary risk continues to be execution risk and competitive response form national carriers • Build-out of 40 million Points of Presence (Towers and Connection Points) in the FCC Auction 66 markets by early 2009 • Increased churn due to an economic downturn • The possibility of a dilutive acquisition 14

    15. Action Recommendation • Sell 100% Windstream & Sprint • Action Scenario 1 – Use 50% proceeds to buy AMX and 50% proceeds to buy PCS • Action Scenario 2 – Use 75% proceeds to buy AMX and 25% proceeds to buy PCS T E L E C O M S T O C K R E C O M M E N D A T I O N 15

    16. Questions? 16