UTStarcom

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UTStarcom

• By Rob DeWitt

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Company History

• UTStarcom was incorporated in Delaware in 1991 as
  Unitech Industries.
• In 1995 it acquired StarCom network systems and
  changed its name to UTStarcom.
• Began to be publicly traded on March 3, 2000 at
  18.00 per share.

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What do they do?

• They design, manufacture and sell
  telecommunications equipment, products and
  services associated with their operation.
• UTStarcom is in the development of wireline,
  wireless, optical and access switching solutions.

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Products

• Their technologies fall into 3 major categories
• Wireless- enables users to send and receive voice
  and data while mobile and using wireless devices.
• Wireline- technology that satisfies customer
  demand for high-speed, cost affective data, voice
  and media transport and carriage.

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Products (cont.)

• Switching- diverse assembly of software and
  hardware based networking elements designed to
  replace central office telephone switches.
• All of these technologies are based on widely
  adopted global communication standards to allow
  service providers to quickly and cost-efficiently
  integrate their systems into existing networks.

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Location

• UTStarcom conducts business globally in China,
  Japan, India, the Central and Latin American
  region, North America, the European, Middle
  Eastern and African region and South Eastern and
  Northern Asia.
• Their objective is to be the leading global
  provider of Internet Protocol networking products
  and services.

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Growth of the Company

• Last year 86 (1.7 Billion) of their revenue
  came from China which means that they have a lot
  of room to expand into the Americas and other
  nations as well
• Introducing new line of technology called 3G
  which allows people to talk to a friend, watch a
  video clip, or surf the Internet - simultaneously
  - and all from one portable multimedia device.

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SWOT Analysis

• Strengths
• wide range of products to fulfill their customers
  needs
• Huge brand name in China, were most of their
  revenue comes from (86)
• Weaknesses
• Rely on big name companies for contracts to
  generate most of their revenue, could potentially
  harm them if they are outbid by another company

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SWOT Analysis

• Opportunities
• In 2003 and 2002, 86 and 84 respectively, of
  their net sales occurred in China
• CDMA 2000 and 3G protocols are starting to be
  introduced to the market
• Threats
• Cisco Systems, Nortel Networks, Lucent
  Technologies and Huawei Technology are some of
  the companies that UTStarcom competes with and
  they expect this competition to increase

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Key Stats

• 52wk Range 12.59 - 42.25
• 52-Week High (8-Jan-04) 42.25
• 52-Week Low (20-Sep-04)12.59
• Growth Est
• Next year UTSI Sector
• 103.6 15.4

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Competitors

• Nippon Telegraph, NTT
• Verizon Telecomms, VZ
• France Telecom, FTE
• ATT Corp, T

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1 Year Chart Vs. Competitors
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Stats

• Intrinsic Value- 20.86
• Current Price- 17.51
• Purchase Price- 32.39
• Initial Cost- 1,392.77
• Current Market Value- 752.93
• Money Lost- 639.84

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• QUESTIONS?