Cowen Slams Goldman on Radio Stocks Analysis 172 comments
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In a note issued Friday, Cowen analyst Tom Watts was very pointed in his disagreement with Goldman’s Wienkes.
“We disagree with competitor’s negative view,” noted Watts. He also stated that investors could, “Expect a rebound.”
Yesterday, Outperform-rated Sirius (SIRI) ($2.13) traded down 13% and XM (XMSR) 18% ($8.61). A competitor’s note (with which we disagree) contributed and technicals may have widened the arb spread. We expect FCC approval and the debt restructuring to drive a rebound of both stocks in the near term.
Watts cited several factors including: increased OEM installations (penetration rate) that would offset slowing car sales, substantial merger synergies of $5 billion, FCC approval in July, the debt issue being closed not as big a hurdle as some anticipate, and the arb spread to begin to narrow again as anticipated merger closure draws near.
While Watts did not take on specific aspects of the Goldman report, some obvious factors that I note are that Goldman states that “young people” are buying MP3’s. This is not real news. The “young people” have not been the largest contributor to SDARS subscriber-ship since the beginning. Additionally, the A-La-Carte pricing may make subscriber-ship something that is more budget friendly to the younger crowd. Combine MP3 capability with the “music discovery” allowed by satellite radio, and there could be a winning combination. The MP3 crowd is often music centered. A satellite radio service at $6.99 per month that enables fans to get only what they want may well carry more appeal.
Additionally, Goldman cited that ARPU would be impacted with the new pricing plans, and mentioned an OEM take rate of 50%. What it would appear Wienkes did not consider was that more attractive pricing points may increase subscriber-ship, thereby offsetting a lower ARPU (oversimplified example):
CURRENT TAKE RATE 50%
100,000 cars turn into 50,000 subscribers paying $12.95. 50,000*12.95 = 647,500 - ARPU of $12.95
TAKE RATE OF 50% Full Price, and 10% AT $6.99
100,000 cars turn into 50,000 @ $12.95 and 10,000 @ 6.99. 50,000*12.95 + 10,000*$6.99= $717,400 - ARPU of $11.96
While the ARPU is indeed almost $1 lower, the revenue coming in the door has increased. The ability to capture additional subscribers at the lower price point represents more dollars. ARPU is an average metric of revenue per subscriber. Simply stated, the business model will shift a bit more towards volume, something that it appears Goldman’s analyst has not fully considered.
With no company guidance and no real certainty, it becomes hard to know what analysis to count on. There simply is nothing for anyone to hang their hat on. Goldman is the “golden child” of the moment, but how long will that last? SDARS is quickly approaching a level where Wienkes will need to come out with yet another opinion. Will he “upgrade” from “convicted sell” to “sell”, or adjust his target further down? Only time will tell.
Position - Long Sirius , Long XM
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This article has 172 comments:
Down side from here should be limited,but you never know.
The other station is geared more toward the 90's and later. There I get a steady diet of Nirvana, STP, Disturbed, Chili Peppers, Nirvana, Guns and Roses, Metallica (no complaint there), sprinkled in with some 80's stuff, Linkin Park, Kid Rock (gimme a break), and of course before I forget, Nirvana. And I get the commercials as a free bonus! Guess what? These days I drive in silence 50% of the time.
And some idiots actually think SatRad will fail? SatRad will be a luxury that will turn into a necessity. Remember the cell phone folks? How many of you had one in 1990? Now people aren't even having home lines anymore. I know I don't. Terrestial radio will join the T-Rex and the 8 track in the annals of history once people get a taste of it.
We need to look at the forest and not the trees here folks. Yes there are some chinks in the armor that need to be patched, but they WILL be patched. The forest is rich in nutrients and very arable, and soon the crops will be planted correctly.
One thing, they need to stop giving away monster contracts when renegotiation time comes around because this time they will have more clout. Seriously, where is Stern gonna go if he doesn't retire? No one can pay him what SatRad can. And I'm sure this time around, he will be a little more lenient, concientious if you will, to the fact that Siri has suffered immensely due to astronomical spending and maybe he'll turn into a team player. After all, he already made his killing.
On another note...why are some of you buying SIRI when you should be buying XM? You get more bang for your buck with XM right now due to the wide conversion spread.
AND AFTER HURRICANE KATRINA.One form of communications that continued to operate without interruption during the
storm was satellite technology. Satellites are located thousands of miles above the Earth and are
thus able to operate even when disasters occur on the ground. With that in mind, when Hurricanes Ivan and Jeanne hit Florida in September 2004,XM launched a new channel -- XM Emergency Alert, Channel 247.On this channel,
listeners can receive key survival information such as evacuation routes, shelter locations, and
updated weather emergency information for impacted areas.During Hurricane Katrina, XM also established an additional public safety channel, Red
Cross Radio, XM Channel 248. This channel provided information pertinent to Red Cross
workers in the Gulf Coast region, as well as Red Cross aid stations in Houston and other cities, as they assisted in the relief effort.
Again, as with XM Channel 247, Red Cross Radio was available to anyone with an XM receiver without the need to pay a subscription fee.
These words were copied and pasted here from a Letter to the FCC from John Archer
Vice President, Operations
XM Satellite Radio Inc.
www.fcc.gov/pshs/docs/...
Another reason for the prompt approval of the Merger.
See: http//Forecasts.com
I'll be selling half my stake and waiting on pins and needles to see what BOLD moves Sirius is able to pull off this year!
They better sell their souls to Apple or Zune to make things start happen! It would be nice to see Zune add a new element to their MP3 players to compete with Apple!
Why not build the subscrpition costs of satellite radio into Zune and include this service for free?
Just a thought!
Merger coming soon a quick in and out.
Now as for Mark W. And the example that Tyler has given I think what Mark is talking about, is that what will bring ARPU is that more of the 50% will go for the 6.99 package then the extra subscribers that would join at the 6.99. Or that more of the original 7.6 million subs would switch to the 6.99 and that would bring the ARPU down and the total revenue down. I personally dont think everything Mark W. is saying will happen and I suspect what Tyler is saying in a simple form is that the ARPU may come down but revenue will go up in general and that is a more reasonable conclusion. This was my thought from another article:
Here is a thought, How many subscribers do you think hold both SIRI and XMSR right now, and are paying the 25.9 each month for both. I have to say, I think the percentage is very very low. Now how many subscribers do you think that have had all the content that they have been exposed to from ether SIRI or XMSR would go down to the 6.99 subscribtion that really only offers music channels. I think that percentage is very very low, as a matter of fact if they would go for that package then chances are there is a big percentage of those that would have (churned out) left anyway. Now how many people that pay 12.95 a month to get one would not mind paying 2 or 4 dollars more to get the SIRI/XMSR you have now plus the best 13 channels from the other. IMO, The al la cart will not only lower churn, but may actually bring up the ARPU. Give them a year and then you will have another price point that will offer, access to both full services, for some higher price.
Here is an example I think we all can agree with: How much did you start paying for your cable/satellite tv when you first got it. Now how much are you paying. I would be willing to bet most have upgraded to the extra package and are now paying more then they did when they first started it.
All I am saying is when you here analyst say the al la cart is going to bring ARPU way down think about what happen to your cable/satellite tv bill. Just a piece of common sense. I also believe Mel Karmazin has thought about it to.
My point to that is that while there will be other options open, that they have been made so limited that most will find that they will be better off, staying with the 12.95 package if not moving to the more expensive package for the limited extra cost. Just as most have found in their cable/satellite tv options.
Analysts at this point in time, as Tyler and others have reiterated, have no real guidance from the companies or metric to measure the possibilities post merge. At best, cost savings synergies, debt reconfiguration, capital expenditures and depreciation savings, are what they are looking at with revenue remaining a relatively fixed ratio to these expenses. Post merger upside surprised in revenue with new product releases, additional unanticipated subscribers, and the release of "pent up" retail demand will move the revenue side beyond analysts current projections. Mel and his team will also be reselling this company and providing concrete guidance, which I am sure he will make sure he beats every quarter for the next year or two. When all you can look at is managing expenses and attributing no real growth in revenue, the picture is grim, and is being presented in that light in current analyst projections. At these stock price levels for both companies you can't go wrong with the risk reward ratio given the pending merger approval.
three gallons of gas: $12.20
a date at Wendy's: 14.50
four movie rentals: $16.00
a month of staillite radio: priceless
The young people will come around.
Tyler, nice work on the coverage. Is a MP3 / SDARS device a solution? Also, can internet operate off current satellite signals, or would they have to integrate WIFI into those devices? After the merger, what's next for Satellite Radio?
after the merger,and doesnt happen.
Plowboy....this piece considered the "cut" by the example given. ARPU is a metric that is not the whole story. Increased revenue with decreasing expense is not ARPU. ARPU is not a GAAP metric. It is an operating metric for benchmarking the business. SAC is another example of an operating benchmark. As a number it will increase with 6.99 subs and decrease with 14.99 subs but gross revenues will still be going up. In the end the number that matters is EPS, EARNINGS, and they need to be positive. All the expense synergies of the merger are not part of the ARPU, go figure. By the way, when it comes to SAT RAD what is "SUBSTANTIAL" % of the gross ARPU anyway.
Plowboy, while I know I am no Mark W or Tyler S. look at the second paragraph of my June 22nd statement it gos into that. I know I ramble on. It is just common sence, and it will take you far in life.
GABES, As to why Mel Karmazin has not spoken up about this is simple to me. It is first of all as cos100 has put it. second reason is It has been said by many in the press and analyst, of which I will give the best one; You dont want to make alot of noise as you are tring to sneak across the boarder (Motley Fool, Mark M.) Simply put you are not going to say to the world that you are going to crush Terrestrial radio once this merger is approved, that just will not help your case with the FCC. On top of that Mel karmazin has always been known to, under estimate on over achieve.
If the radio's are already in the cars, no additional cost to Sat Radio. Right? And when Mel sees cancelations of car radios and the reason being given is the sale of the car and purchase of a new car. How much less will it cost to advertise to the 'new' owner a thirty day free trial when they call up and activate it with their credit card?
Sixteen Three, it just strikes me that there is a lot more money in those cars than first appears. And, as the price of the car falls, it brings in another demographic of buyer.
What are your thoughts in this area? Thank you.
Killerkaul, I never get tried of hearing that Chuchill quote. As you know I say it a little differently.
Who's stock price cause quite a fuss,
By the comments of a clown
the price went down,
which made it more affordable for the rest of us.
is that it will come out alright,
so, don't rush to sell
just wait for a spell,
and the price is sure to change in a fortnight.
Killerkaul, I just like the more insulting way. " If you are not a liberal by 20 you dont have a heart. If you are not a conservative by 30 you dont have a brain.
1. I "jumped into" to Sirius and XM at levels well below the price of today. How do you come up with me being down 40%? Where do you see me recommending a buy or a sell? I do not do that. You may have me confused with someone else.
2. I do not disclose how many shares I own. I do not ask you the balance of your checking account. I have stated that the shares I own will not change my lifestyle even if Sirius went above $10 and XM above $30. I have disclosed that I sold most of my holding prior to writing about the sector.
3. I am bullish on SDARS as a concept long term. How the equity will perform is yet to be seen. I have stated that I am rather neutral during the merger process, and stated several times that these equities are locked into a channel until a merger decision is made. I have spoken of a limited upside even with approval, and that the street will need to see concrete guidance as well as results prior to any large movement in the stock.
Thanks!
Thanks
I also really hate it when people try to blame others for their losses in the stock market. NO ONE MADE YOU BUY THE STOCK! You may have chosen to rely on what turned out to be a poor prediction... but it was YOUR CHOICE!
User 202507 - I am interested to hear your analysis of the SIRI/XMSR stock. Where do you think they will go from here? Believe me I am just as frustrated as you are with my SIRI position. Are you going to wait it out?
And then maybe Tyler or Killer or 163888 will respond with agreements, disagreements, points and counter points, and then the discussion will continue. Maybe we will be better for it, maybe not... but a discussion is better then a message board shouting match.
I for one am confident that the stock is undervalued, has great potential vs. very small downside, and a great high-risk/high-reward addition to any portfolio.
I did stop watching the SIRI during the day... Down to $1.92 now?!?!?! Predictions anyone as to the bottom of this slide??????
Are you affiliated with the NAB????
Other than attacking Tyler, I haven't heard you add anything to what is happening right now. What's your question?? Your company, that You chose to invest in, is under attack and all You can do is blame Tyler for the stock price going down. No one, including myself, likes to see their company stock beaten down. As I posted above if I liked this stock at 4.00 I love it at a 1.92. If your a short term investor who needs your money out in 90 days, I have little sympathy for you. You rolled the dice and you may lose. For the rest who own this company, not just a STOCK, the company will be successful over the next year and our "Investments" will be profitable. For the rest of you I really wish you the best but stop your whining over your decisions.
Tyler, as always I appreciate the information that you provide that then allows me to apply it as I see fit. Thank you.
Goldman cuts financials, admits goofed on upgrade
The GS group will probably be very Bearish on all aspects of analysis for a while. It also make me wonder if there was an internal memo (on the topic of positive analysis), that triggerd a step back towards conservativism.
Once again, I do not recommend "buys" or "sells" in these or any equities. Much of what I write is a synopsis of what analysts are saying, as well as my own opinion on various issues..... and I cover pretty much all of them.
Seeking Alpha picks articles of mine for republication here. They do not publish all of my articles. If you want to see them all you will need to go to my site. I started writing about SDARS with satellitestandard.blog... in March of 2006.
I have not made a "buy" or "sell" in either of these equities in over two years. I bought my initial shares in Sirius and XM when Sirius had about 20,000 subscribers, and yes it was quite some time ago. I sold most of my position on the run up to $9 for Sirius and the run to $40 for XM. Most of my Sirius went in the $7's and most of my XM in the high $20's and low $30's. What I have today is about 10% of what I once held. I have always maintained that it is my intention to hold these shares to see how the sector plays out. This is why it will not change my lifestyle. I am much more heavily invested elsewhere.
Clearly you are frustrated. Many people are. For a long time these equities would have swings in price and no one would know why. An analyst report would be issued, and no one would even know about it unless you were on the street. I have provided that information or at least a synopsis of it so that at least people can be informed.
I have opinions just like anyone else. My opinion on the arbitrage was that if someone felt the merger was going to pass, and they were going to invest in the sector, that the arbitrage made XM a better play. That is still the case today.
I am sorry about your frustration. I have followed these equities for several years now (since the recap of Sirius). Would you rather have no information, or some information? Your buys and sells are your decisions.
202507, Tyler has never *really*(he has given resistance levels) given price targets even when asked. Also when asked about hypotheticals, such as a time frame for when will the FCC will make a decision he always says something like "my guess is" or "yours is as good as mine" he is always clear that he cannot be sure ether and that it is just his opinion. 202507 go to Sirius Buzz Radio an see for yourself, I erg you to listen to the beginning very carefully He gives a full disclaimer. If you want to place blame I suggest you start with the analyst that have given the higher price targets because if what they say is true then their own clients should be supporting the stock at the higher level then it is now. I mean hell they should be screaming to their clients BUY BUY BUY at this price. On a final note it is no quintessence that most that follow Tylers work are not here for the short term. Why, well that is simple Tyler has always said there will be no big up swing it will take some time. He has said many times dont expect the stock to jump to 5 that 4 would be a miracle (basically) that there are to many resistance levels to get that high. that many analyst are waiting for solid guidance.
Tyler, sorry for mentioning the price you got your shares at. Did not know it was going to send 202507 into orbit. I did what you did with the exception I started to buy back at 4. What I dont understand is why 202507 got so upset, because I think what you did was very intelligent. LOL
163888...I thought you would get a chuckle out of your new found position on Barron's Blog. Killerkaul clearly has appointed you as the clear owner of "Dave".....Congratulat... Good Luck!
Siri stock could be 10 cents and the number of shares given to XM holders would still be 4.6 Siri shares for 1 XM share. (Note, I am not saying it is going to 10cents.)
The value of the stock both before the merger and after the merger is determined by the merger.
This was pointed out by COS 1000 in a previous message.
From Cos 1000
The number of shares to be exchanged is fixed.
XM holders get 4.6 shares of the new company---SIRI.
"As Cos 1000 wrote
GABES....for every share of XM stock, Sirius will pay 4.6 shares of SIRI stock. It's a 100% stock transaction. Mel Karmazin can't defend the stock fully until the FCC removes the licensing road blocks. That's why the companies stopped giving guidance. All guidance would be as stand alone companies, as they are now. Any defense of post merger operations and profitability would be foolish at this time."
What I don't understand is how the merger company will value the new stock---is there an SEC document on this valuation? Is the new valuation tied to price at the time of the merger or is the new valuation simply a parvalue such as $.01.
That doesn't matter---------hower"
Good job on adding to your position today. Its hard to justify chasing this stock but your not buying on a "tip". You have researched, read, inquired, and then decided that its what you want to do. Good luck to us all and may Mel and the folks at Sirius .........Let the "Blue Dog" OUT!!!!
In-fighting at the FCC!
----------------------...
This is one of those could be good, could be bad type articles. Apparently, for the first time, Kevin Martin lost a decision 4 to 1. (See todays news below, not Sirius/xm)
The bad, as I see it, is that this could set a precedent for a political battle that's about to heat up. If Kevin over-reacts and irks his fellow commissioners, he could find himself and us on the denial side of the sirius / xm merger as well.
Now the good. I have felt that there was something going on that has caused the decline in the stock price. It just may be that "inside info" from this case was confused with our case. Don't be fooled. Inside stuff happens all the time, it's just a matter of not getting caught.
Also, this could have been a trade-off for the democrats voting with the sirius/xm decision. Time will tell...here's the story:
Former Customers Off Limits To Verizon
FCC Rules Against Courting of Exes
Verizon requested a stay of the ruling. It was the first time Kevin Martin had voted with the losing side since he became FCC chairman.
Verizon requested a stay of the ruling. It was the first time Kevin Martin had voted with the losing side since he became FCC chairman. (By Jin Lee -- Associated Press)
By Cecilia Kang
Washington Post Staff Writer
Tuesday, June 24, 2008; Page D01
Verizon, it's over.
No more letters. No more presents. No more anything.
The federal government, speaking on behalf of former Verizon phone service customers, yesterday sent the communications company a stern message: Stop trying to woo back those consumers who have opted for a new provider. They've moved on.
Verizon had been using its proprietary data to contact former customers and try to persuade them to give the company another try. But a majority of members of the Federal Communications Commission yesterday said such practices are illegal and infringe a consumer's privacy.
"Today we carry out Congress's unambiguous mandate to protect consumer privacy," said Robert M. McDowell, a Republican commissioner. Two Democratic and two Republican commissioners voted against Chairman Kevin J. Martin, a Republican. The chairman had pushed for the agency to rule that Verizon's use of phone numbers to contact its departing customers was legal, despite complaints from cable service operators.
And it gos on, goto Sirius Buzz forums to see the rest
It would seem that you are not understanding what I am writing, and perhaps this is a source of confusion for you.
1. I stated that I have about 10% of what I once held. I also stated that I made my sales in the sector before I started writing about it. I did well in the investments, and pulled most off of the table a long time ago.
2. SDARS is a speculative sector. Neither company has ever made any money. Most who invest in the markets understand the speculation that comes with an investment in SDARS. I like the concept of SDARS. I have always felt that the business plan has viability. I speculated and won long ago. Now I keep a more modest holding in the stocks, fully understanding that these are still speculative stocks.
3. My position in the sector is "long". I hold shares and disclose that fact. Just because I am "long" does not mean that I am saying BUY, SELL, or HOLD. It also does not mean I am BULLISH, BEARISH, or NEUTRAL. In fact, over the past several months I have been more neutral on the short term aspects of these equities. I actually have people question me on what I see as the short term upside that comes with a merger. Some feel that I am too bearish. You seem to feel that I am too bullish. It is interesting how you read it one way, and others read it another.
You need to understand that being "LONG" is not a recommendation. It is merely a statement of position. Perhaps you have felt that "LONG" is a recommendation. If that has had you confused, then I am sorry. I have tried to explain this to you, but you seem caught up in your own thought process.
Here are the latest updates on SIRI & XMSR.
SIRI is behaving normally in that as price dips, the expected future upside price movement gets greater.
Not so for XMSR, which deteriorates as its price dips.
This suggests artificial interference of a bearish nature in XMSR. Both stocks are being kept down by external factors as technically some rebound, though modest, is likely once the pressure lifts. The probable amount of price movement and its percentage is projected as indicated. Given that they are positive, and readings are reasonably high, it would seem imprudent to be short or maintain short positions in them. FYI only, not recommendations or advice.
FORECASTS ON TICKER SYMBOL: SIRI
SYMBOL, DATE, PRICE, FORECAST, PERCENT
SIRI, 20080623, 1.9300, 0.2234, 11.6
SIRI, 20080620, 2.0300, 0.2103, 10.4
SIRI, 20080619, 2.1000, 0.2289, 10.9
SIRI, 20080618, 2.4400, 0.0430, 1.8
SIRI, 20080617, 2.5200, -0.0914, -3.6
SIRI, 20080616, 2.6200, -0.1172, -4.5
SIRI, 20080613, 2.5300, -0.0018, -0.1
SIRI, 20080612, 2.4000, 0.0824, 3.4
FORECASTS ON TICKER SYMBOL: XMSR
SYMBOL, DATE, PRICE, FORECAST, PERCENT
XMSR, 20080623, 8.1000, 0.9334, 11.5
XMSR, 20080620, 8.4300, 1.0811, 12.8
XMSR, 20080619, 8.5200, 1.2880, 15.1
XMSR, 20080618, 10.2500, 0.3610, 3.5
XMSR, 20080617, 10.8100, -0.3111, -2.9
XMSR, 20080616, 11.2700, -0.3645, -3.2
XMSR, 20080613, 10.7100, 0.1374, 1.3
XMSR, 20080612, 10.2000, 0.4760, 4.7
Source: ForecastS.Com
This is the way it always happens the market or a stock gets over sold then corrects. For god sake the Dow is down to 11,800 now that is vary low. The market is a waiting game.
Killerkaul, I am changing my last buy from 1.5 to sometime Thur. I think it will go down until then. Then we should see it pick up again. I got my fingers crossed nothing happens til then.
[Comment edited for abusive language. Commenter put on watch]
We assess inherent high risks associated with a nascent satellite radio company with a relatively limited operating history and the liklihood of continued losses and negative free cash flow, AS WELL AS STOCK PRICE VOLATILITY THAT IS WELL ABOVE AVERAGE.
Tyler is not the only source of information you should be using. Don't buy any stock without doing your own research. You said above that you have to be your own analyst to by a stock, like you were under the impression you didn't have too. If you want someone else to manage your money, rather than CD's or Banks, you should probably by mutual funds and seek professional assistance to find out which is best for your "Risk Tolerance". Most of us here do our own homework, invest in stocks that we have personally researched, and then come here or Sirius Buzz to find out what's others think, including Tyler, who I felt was bearish post merger on Sirius. We are all down in this stock...take a breath an no your not the only one. Taking #'s and making threats is boring...grow up or move out.
Killerkaul, Dave from Barrons would call that insight about margin/house calls lucky. I like to call it common sense. I am not saying that that is the only possiblity but it very may will be. It is all over various boards the last few days, how people are talking about getting slamed by margin calls.
I read from cfrceo, that staffers will start leaking votes out. I also got from a news article that once it has been circulated commissioners are able to make their votes known.
except for the pampers kid (user 202507)
I agree that the concessions Martin has recommended indicates that he truly is in favor of this deal....BUT: I still believe he shares in the blame for this taking so long. It's outrageous that it has taken this long and he is the one who ultimately controls the process. While approval would be great, the delay he has fostered has cost these companies (and our investments) tremendously.
Finally, I laughed too when I saw Killer's note above (not making fun of you Killer, just the situation)....think we can get to 2.50? 2.25? Was it just a month ago people thought we'd see $4 to $5 on approval? The wind is definitely out of my short-term sails...while I hope I'm wrong, I can't imagine anything higher than $2.50 until late this year as the positive effects of the merger begin to materialize. It's incredible that the GS analysis seems to have had so much influence, but the other bullish analyst opinions had no impact whatsoever.
202507...on the one hand I feel your pain, this whole thing has been incredibly frustrating and financially destructive...on the other hand if you bought because you THOUGHT Tyler had a sizable long position, then you have nobody but yourself to blame. Any research of Tyler's articles and website would have told you the same things he disclosed above...not to mention buying because you think a blogger has a large position is ridiculous.
Tyler...add me to the long list of people who appreciate the articles you've written and the information you've put out there for us.
I have said before that I think it is mostly because they were able to escape the sub prime mortgage mess, that got everyone else and they are now considered the golden child
cos1000, So when is your first date. Wait til he tries to get into your personal finances.
By the way, If you recall I was going to wait on DSX to get to 30 to buy back, but I think I am getting it Wed. first thing. Things are getting to good for the dry bulk sector. Read these:
www.bloomberg.com/apps...
biz.yahoo.com/prnews/0...
www.cnbc.com/id/252377...|headline|quote|text|&...
www.ssyonline.com/News...
On that note, I see you guys tomarrow. Opps heynow913, I mean I'll read/write you guys tommarrow, LOL.
Stan Muse
As far as this drop goes, it's a hard one to call. My opinion is that anyone who was waiting to get in, has gotten in or will over the next couple of days. I also think that this has flushed out a lot of folks who were looking to make quick money on a pop. If the merger decision is positive this stock will be very volatile, chaotic will be more the rule. With ever quick pop up it will sell off and retrace. I won't do anything for the first couple of weeks until Mel starts to release info through the investment community. He has to resell this company and sat rad's future. During the first month I wouldn't be surprised to see spikes to 3.5-3.75 but these will be fleeting. Look for 2.85, our old brick wall, to be a good indicator of what's next. If we hang around it for a few days without breaking, then it will take another catalyst to get us through. If it breaks it on the upside and holds at 3.10 - 3.20 for a few days then we're soon going to be off to 3.6-3.85. There will be a tremendous amount of positive chatter from everyone if the merge goes through with the current concessions. This will draw folks in and the stock should have a positively moving 200 day MA. I believe changing the direction of the 200 day MA is essential for continued stock price growth. Channels will form for short times on the 13 day MA. Until this stock breaks 5.00 It will be moving on sentiment, as always, and good company performance, "The Channel". Just one investing fools opinion.
I have tried to explain this to you in the most simple way possible, but it would appear that you are not grasping what is being stated. I am not a "guru', and have never claimed to be. If you took it upon yourself to anoint me as a "guru" that is your issue not mine.
Might I suggest you read what has been written. I give as much space to bearish reports as I do to the bullish reports. If there is a report out there, I typically give people a synopsis of what was stated in that report. Additionally, with nearly all reports I leave my opinion out of it, and if anything make my comments in a separate article. This way people can see what an analyst is saying and come to their own conclusions without me interjecting my opinion. When I do add my opinion, it is made clear that it is my opinion.
Another thing you need to understand is that most analyst reports being drafted now are carrying a long term (1 year away) price target that is POST MERGER or the are outlining the companies as stand alones.
There has been no guidance issued by the companies, and the companies are virtually silent on the subject. They are as defenseless to a Goldman setting a $1.75 price target and creating low expectations as they are to a Citigroup setting a $9.00 price target and setting high expectations. I am not in the heads of Wienkes, Peck, Horace, Watts, Springs, Levin, Kidd, etc. They have their opinions and models.
What is clear here is that you are not comprehending what is written. I can not help you with that. What I stated is that I hold about 10% of what I held back in 2003 and 2004. It is not a "holding basis" it is simply what I decided to leave on the table when I sold most after the Stern/Mel run up. I was right in buying when I did, and selling when I did. If you want to call me "wrong" for leaving some shares in my account then you can feel free to do so.
I understand that you are frustrated. As I have said, many people are. I would suggest however that you look more deeply into equities in the future before trading them. When I invest I rely on MANY sources for information. I highly suggest that you do the same.
Do I follow SDARS closely? Yes I do, and I am comfortable in what I have invested in these equities. Even at these levels, I have not added to or changed my position at all. When I do a buy or sell, you will see it disclosed.
I get contacted by people like you saying I am too bullish, and others saying I am too bearish. Both can not be right, but both have their reasons for believing what they do.
If you have not done so, I would highly recommend that you speak to a financial advisor who can give you information on risk levels with various equities. This will help you be a more prepared investor, and may guide you to equities that are considered safer. I wish you the best in your efforts.
On Jun 24 01:56 PM Rawbhurt wrote:
> This stock will hit 1.75 before the merger and probebly even lower.
On Jun 24 09:08 PM cos1000 wrote:
> Merger Mania......Can you believe these shorts out here trying to
> pick our bones. I'm concerned but buying into this extraordinary
> opportunity. Any thoughts on the FCC. I read an interesting post
> that their are two articles in circulation. One that evaluates the
> Public Interest value, which is their mandate, and the other to change
> their one company-one license rule. Any thoughts, Tyler, anyone.
I guess what I'm saying is that I have bought into a Company not a stock. This company and its technology, and wide spread customer satisfaction with the product, is going to be successful. Because I have researched, and discussed with others here, rarely Tyler, I am absolutely convinced (MY CONVICTION), that this company will be a CASH COW, sooner with the merger and later without. Not everyone agrees with me and I don't really care. My sense of you and your investment is that you believed in all that will be possible for this stock, but you need or want it now. The FCC, not Tyler has put these companies in LIMBO for over a year now. We are all frustrated but MY Convictions haven't change towards the company regardless of what anyone else says, professional or otherwise.
That's what makes money, lots of money in this HEARTLESS market. My opinion is that 1.75, per Goldman may be reached but you already suffered through 1.83's low today. Hold on and wait, don't sell unless you absolutely have to.
I am not trying to patronize you or anyone, but clearly there were some things that needed hashing out for clarity. With all due respect, it is not my position to make decisions on behalf of other people. It is not my position to be the arbiter of the information in terms of whether it is good or bad. I can and do offer opinion, but that is simply my opinion. I have seen good analysts and bad analysts. I have seen good information and bad information. More often than not, without me giving a bit of detail about what is out there, there would be no information.
I do not make the rules of the market. I report on its happenings, and offer my own opinion. My opinion during the merger process has been that the stocks were virtually glued to a channel and were not going to move substantially until a concrete merger decision was made. My opinion on a merger announcement has been that it would take a "perfect storm" of events to see SIRI get past $4. My opinion is that the "short squeeze" many are thinking will happen will not. My opinion is that investors have been "battle fatigued" for quite some time and that there would be very willing sellers at anything above $3. In fact, I have stated that I felt there would be enough willing sellers to offset any short covering. I have offered that opinion for quite some time now. If you follow my opinions you would see that. I have received "nastygram" e-mails because I "had the nerve" to put a low ($4 SIRI if everything goes well) target on SIRI and XM post merger approval. Yet somehow I am also getting slammed for being "bullish". I have stated that even with the merger, that the street will need to see concrete evidence of scaling metrics before people would jump on board. Somehow though, all of this falls on deaf ears.
What about these positions and opinions did you or other readers not catch?
Part of what I do is simply make information available without interjecting my opinion. I gave the CITI report the same coverage that I gave the Goldman report. Readers can at least see what the analysts are saying without my interjection of opinion. I typically separate my opinions into another article.
In an article recently I spoke of potential buyers and stated, "Would a Primosphere, a CBS, or a Google have interest in one of the companies? Perhaps, but perhaps not. If the company can be had at an attractive enough price, a buyer could step into the picture. However, seeing the financial performance of the companies to date on a stand alone basis, any buyer would be assuming a lot of risk."
I clearly state that a buyer would be assuming a lot of risk.
In an article about Goldman I wrote, "Clearly the possibility exists that the companies will have to raise additional cash. Integrating the merged company will have its challenges, and even with efficiencies made in management, the savings do not happen right away. Whether more readily available synergies such as sales and marketing savings can help weather the storm is not clear. Last year Sirius and XM were able to put together decent second halves, and this may enable them to get through without issuance of new shares."
There is caution in these statements.
Regarding "Long SIRI, Long XM"....It is a disclosure statement that I have positions in the companies. It is not a statement as to my sentiment, nor is it a statement recommending buys, sells, or holds.
Support levels....Tough call. The stock has approached a level where I feel Wienkes needs to address the issue again. If he decides to keep a "convicted sell" on the stock then he will have to take down his target. He could also "upgrade" to sell (as silly as it sounds it would be an upgrade) and maintain a $1.75 price target. It is obvious that Goldman has the ear of the street. The next action of Wienkes could be what sets up the bottom. IMO, with his $1.00 SIRI value as a stand alone, Wienkes may have one more leg down to a $1.50 target. However, there is a point where he needs to acknowledge a value of the merger, and he is running out of room. IMO he should come out with some sort of opinion simply because the stock is so close to his target. Investors that follow Goldman will be waiting to hear what direction Wienkes is looking. Can Wienkes justify a stand alone price of $1.00 vs a merged price of $1.50? Perhaps, but that is about the bottom in my thinking. Anything less than $1.50 and people who do see value in the merger will seriously question what he is thinking.
2057....
I have "covered" (written about) satellite radio with articles for the past 27 months. I have watched these equities closely since the recap of SIRI.
For All....
I appreciate the comments, the discussion, and the sharing of opinions. I think that there is value in this type of interaction. I always encourage people to seek out as much information as possible, and weigh all of that information carefully. I recommend that people understand the performance of the companies that they invest in, and understand the risks associated with investing. I maintain a position in SDARS because I believe in the concept of, and enjoy, satellite radio.
What do you think Mel has up his sleeve post merger? I find it hard to believe he will go out without turning a profit.
Consensus Recommendation (Provided by S&P)
Buy 6
Accumulate 4
Hold 5
Sell 0
No Opinion 0
Total 16
Still looks pretty bullish to me. I am probably down more than all of yall but I'm sticking with SIRI. Why? Because I know that they have a product that everyone wants, and can afford. It is unique and can not be duplicated by any other technologies at this time. Everyone I know that has it raves about it.
That is the key to successfully marketing any product. That is why Microsoft became such a success. We have a product that can and will touch tens of millions of people and fundamentally change their lives.
If you need to get pissed at someone for being bullish on SIRI and writing about it you can get pissed at me.
Stan Muse
killerkaul, just so you know I corrected my post very soon after on the pre merger movement.
Now as to your other question about, why I am still sticking to my long held post merger 3.8 target, mostly because I am stubborn. No not just that. First of all, I think SIRI/market is over sold (over reaction), there is always a correction, for no other reason then to correct. Second of all once all the margin calls get out of the way, what we will have buying at this level are ether new investors now waiting that may not be so battered by the long wait (less likely to sell so fast) plus we know they have the money themselves to buy the stock, no margin money, no outrages interest rates being paid (which means they would not be on a short time frame due to interest killing them). Those things I just mentioned alone, I think should push the stock up, if not at the very least stablize it. If it does get to above 2 or even maybe 2.15 you may see some very very big risk takers buying back. The reason (theory I have) is they just lost alot if they stay out, (going from 2.3 to 2.8 maybe even higher, lets say to having to selling at 1.98 to 1.85 or a little less) but if they get back in using margin again, with the merger this close they would be able to get their money back. Just to be clear the last part is kind of unimaginable, but may be true, if most of them are pissed they had to get out just before the merger and think the merger is going to push it up again, or if they could not get the money in in enough time to cover the margin/house call. That could if true and it is a BIG if, push it up even more. Then the merger is approved. I do think they will have to say that financing has been secured (but I also saw, I think it was one of Tylers articles that an analyst was talking about SIRI/XMSR were already working on that in May. Then stoped to work with the FCC and that both would be answered very soon of one another). Those things should get it up to 3.8 (It is funny because, I was told before by many, that I was crazy for saying it a long time ago, that I was way to low. Now they will say I am crazy for saying it because, it is to way to high.) I believe that, while many dont think the stock is worth that much. It is not the price of today we are buying it is the price we dont want to pay tomarrow. That was a theory I have, not fact. and there is even a "big if" in there. Take it, or leave it. So 202507, please forget it if you read it. Think of it this way it was
cos1000, No I am not jealous, you do your best. Besides I dont know what he told you, but I broke up with him first, LOL.
Do you see what I was talking about, and I can say I think MergerMania is one of many. Also when you see people saying that they are getting out, because they had it or are sick of waiting. Those are also people that got cought in the margin. It is a guess but I some how dought that after this long waiting, they are going to get out of their own free will, just a few days or weeks of a decision. That just dont make sense and if it dont make sense chances are it is not true.
I have followed dsx for quite some time. Love the dividend and growth. It is a cheaper DRYS.
Who's stock price cause quite a fuss,
By the comments of a clown
the price went down,
which made it more affordable for the rest of us."
Poet eh! LOL
On 2008 Jun 22 06:39 AM sgrm33 wrote:
> Purchased 50k shares at the close at 1.99
>
> Down side from here should be limited,but you never know.