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Rhence Platt  

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  • Facebook's (FB -9.1%) plunge managed to trigger short-sale curbs at 12:37PM ET, and from the looks of things, that helped shares stabilize - 18.1% of Facebook's float was shorted as of Aug. 31, quite impressive for a company of its size. In addition to Barron's and Goldman, Stifel contributed to today's misery: analyst Jordan Rohan forecast a "soft transitional period" for Facebook as PC usage flatlines or shrinks in developed markets while mobile usage grows (ed: hasn't it already started?). [View news story]
    When I was in T-ball, a 10 run plunge in the score against the winning team triggered the slaughter rule.
    Sep 24, 2012. 05:25 PM | 1 Like Like |Link to Comment
  • RIM's Major Correction [View article]
    This is fascinating... I clearly remember the October 2011 outrage happening pretty concurrently with the release of the iPhone 4S. With today's outage on the first day iPhone 5's are starting to be activated I start to wonder if somehow spikes in BlackBerry deactivations destabilize RIM's backend infrastructure. I'm not an IT guy, but... two-for-two is tough to ignore. The october outage started within a couple days after the initial 4S release; todays was immediately on the 5's release. perhaps it's an indication the hemorrhaging of BlackBerry users is greater on this release. But it can't be immediately proven, it's just a theory. Anyway, my best educated guess is without the outage, the average declining trend after tuesday's overbuy would have continued at a similar pace as wednesday and thursday, possibly just slightly steeper on today's iPhone release. That would have left it in the upper 6.70's. But again, just theory and clearly that's not how it panned out.

    It shouldn't be too odd I haven't talked much on either earnings or the developer conference. My focus here has primarily been on factual data; RIMM was overbought tuesday, it would correct accordingly, and it is factual that other than 2 criteria-meeting events in January 2012, every single positive price movement with volume greater than 30 million shares in a single trading day has been followed by a downward correction. And this wasn't old news, it was completely immediate news!

    my opinion (and please note I'm keeping my opinion separate from fact!) is that i wouldn't be too surprised at the developer conference having a kind of stop loss overtone to it. I wouldn't be surprised at developers response being interested but tempered. I wouldn't be surprised if there's a glaring omission or two developers are unhappy about. At the same time, if RIM has *anything* new to feature about BB10, i believe this would be the time they would show it. I generally wouldn't expect something game-changingly surprising, but it could be possible. I don't think either way it will fully make or break BB10's chances, and everyone (developers, investors, end users) will probably still have some unanswered questions, but definitely a little bit clearer picture of RIM's future direction.

    Earnings? again this is opinion, and my time is going towards other trades so I'm not going to spout out some perfectly-crafted airtight thesis. The numbers are going to be bad. obviously. the question is really will they be worse or not quite as bad as everyone's already expecting. I wouldn't be surprised if there were a couple metrics that exceed expectations. but i wouldn't be shocked if US and Europe user declines are sharper than consensus.

    What is your opinion on both?
    Sep 21, 2012. 02:54 PM | Likes Like |Link to Comment
  • RIM's Major Correction [View article]
    collectively their team headshots looks like a Lenscrafters ad. Also that isn't investment advice.

    the idea this overbuy decline means zero is wrong. not opinion-style wrong, but factually incorrect wrong. RIMM's share price has been reduced fully 20% in barely three full trading days. And indicators show that this could continue for another couple weeks potentially. any news next week, especially if it's positive could change that. Again; I am not saying I am against RIMM. I might do a long on RIM closer to 2013. I also might short it till it's bankrupt. I'm agnostic on long term outlook for now. What I am saying is anyone would have been foolish to buy at an inflated price and tuesday's activity proved it was inflated. in a short term sense? quite possibly. In a long term sense maybe it's not inflated after this correction is over. but the market did what the market does and corrected downward on an overbuy. And obviously the most effective way to trade on decline certainty, whether short term or long term, is shorting. shorts who traded the top of the volume spike have done really well into today, and the technical writing was on the wall.
    Sep 21, 2012. 12:26 PM | Likes Like |Link to Comment
  • Facebook: 'What's The Rush?' Meets 'Don't Worry, We'll Make More' [View article]
    Yes, in terms of sentiment i would generally agree with you. I would also suppose there is a bit of short covering magnifying a slight rise. I'm probably shorting this b!*#ch back to the teens when I identify an entry point.

    In my view, and I don't necessarily expect other people to agree with this, perhaps the most threatening trend to Facebook is young people just starting to migrate away. I subcontract with a major media company which has the pulse on the various gradients of the youth market. Facebook's younger user base isn't shutting down their Facebook accounts, but they are just at the tipping point of beginning to rely on them less for primary and immediate day-to-day interaction. instead, their Facebook activity is shifting more towards a more detached and sanitized "here's what has been happening recently" longer-term, bigger-picture sort of usage pattern. any discussion of monetizing mobile platform, ad exchanges, whatever, are completely meaningless if a social network's information velocity slows.

    I also just had an article published here on SA relating to volume indicators, a touch of QE3 and shorting RIMM. I identified a technical indicator on RIMM signaling an overbuy. it's dropped from 7.81 on tuesday's overbuy event to 6.48 as I write this. here it is:
    Sep 21, 2012. 11:45 AM | 2 Likes Like |Link to Comment
  • RIM's Major Correction [View article]
    I bet you a Jones soda there's a correlation between Thomas Kemper sales and the VIX.
    Sep 21, 2012. 10:52 AM | Likes Like |Link to Comment
  • RIM's Major Correction [View article]
    In the interest of full disclosure for the readers, I went back and looked at some of your previous comments. Let's copy and paste some quotations here for everyone to enjoy:

    1. "[RIM] projected 1.75 million PlayBooks to be sold this year but the numbers look to be stronger then that, I'm hearing over 2 million so far". 03/11/12. (They actually sold barely a million in the first year of launch and took around a half billion dollar write down.)

    2. "As I have said, iOS is dead, it won't make it through 2013. If Apple doesn't get their act together soon they will be a 3rd tier phone company". 05/03/12.

    3. "RIM is done suffering in the US, elsewhere they are strong". 05/29/12

    4. "Write a naked July $ 9.00 put [on RIM] and be done with it." 06/29/12. (RIMM closed at $6.78 on July's expiration day.)

    5. "[RIMM's] Q1 really means nothing, they'll write down inventory and announce some numbers and that won't do anything for the stock. If they can give some color on BB 10 we could see a rally, the stock is ripe for a rally in the weeks ahead". 06/27/12. (It dropped around 30% in the 4 weeks after you wrote this.)

    And you want to talk about laughable?

    We are not talking about pennies. We are talking about a 14% decline in RIMM's stock price since Tuesday's overbuy. And I modestly submit that I correctly identified it. Recent historical patterns indicate this decline could go on for another week or two. I penned this article after market close on Tuesday. RIMM hit a high of 7.81 Tuesday, and hit after-hours lows of 6.87 Thursday. I predicted between 6.80 and 6.50 by week's close and we have one trading day left. It seems like you're trying to fight the reality of what's happening.

    Again, I would encourage longs to buy if that's the thesis they have. But longs can get the stock at a more advantageous price after this pretty obvious overbuy event continues correcting RIMM downwards. Your methodology seems to be more like 'buy at the top, and pray for a black swan event' if you're talking seriously about "an announcement at any moment".
    Sep 21, 2012. 02:21 AM | 3 Likes Like |Link to Comment
  • RIM's Major Correction [View article]
    I would never recommend stock purchases because "someone else is doing it". That's a relatively thoughtless method of investing, and people who do it get burned. I'm serving up actual numbers which I would encourage investors to do more due diligence on. The reality is we have at the very least an extremely limited picture of what Prem's motivations are, how he can affect RIM's business, and no idea about his current sentiment behind any of his recent trades. The last trading day before he was appointed to RIM's board, the stock closed at $17. Since his appointment, BB10 was announced delayed again in June 2012. My theory is Prem is up against many business issues outside of his control.

    Whether or not the new OS is exciting is pretty subjective. Maybe it's possible? The developer conference next week will be pretty good for gauging if many of the people who matter most, meaning the developers who create a large amount of value in a platform's ecosystem, are impressed. I will say that RIM has a history of shipping products with buggy and arguably incomplete programming in the interest of simply getting something in the market. Did you ever use a first-gen Storm before they updated the OS?

    RIM's lack of debt is great, but I believe pricing-in RIM's cash on hand would be wrong, and that's why the market isn't. It's actually pricing in a looming burn up of that on-hand cash for operations and BB10 release expenses.

    Like I said in my article, longs who want to play on BB10 should absolutely be buyers, but at a better price AFTER the current overbuy is worked out and the stock is trading at a more value-friendly environment.
    Sep 20, 2012. 04:13 PM | 3 Likes Like |Link to Comment
  • RIM: A Sob Sister Dances For A Day [View article]
    Timely article. We saw something Tuesday we've only seen a couple times with RIMM this year: single-day upward pricing spikes with volumes greater than 30 million shares. With the exception of two in January, EVERY SINGLE ONE of these events is followed by a period of price decline. These declines have grown more sustained recently; positive single day 30 million events in July and August preceded multi-week declines. Shorting on these events is probably the key to successfully shorting RIMM.
    Sep 20, 2012. 12:15 AM | Likes Like |Link to Comment
  • Research In Motion: Best Acquisition Target For Lenovo [View article]
    Not a chance in the immediate future RIM gets bought by anyone. Regulators would never allow it, Heins won't consider it till after BB10, an acquirer knows they'd be stacking the odds even more against BB10 as a platform by generating even greater uncertainty in the minds of potential BB consumers, and Lenovo could get mobile exposure way more cost effectively. It's cheaper to BUY RIM than license BB10?? Are you on crack? And who said anything about Lenovo demanding a *vertically integrated* smartphone maker? Buy a currently scared-kitten HTC and drop in an operating system. Lenovo and RIM is a very particular kind of pipe dream.
    Sep 11, 2012. 07:58 PM | Likes Like |Link to Comment
  • Nokia's Hail Mary Pass Fails [View article]
    Oh I think it's definitely true carriers' sales people would likely be a greater factor at the immediate point of sale, and there is absolutely structural incentive for management to have their people sling Lumias; the margin is notably better than iPhones. If I'm in charge of retail strategy for Carrier X, I tell my people "let the people who want iPhones buy iPhones. Get unsure customers into anything that *isn't* an iPhone." From empirical experience, when I was in high school my first job was selling early digital cameras at Best Buy. A) I'm deeply aware of the power a retail salesperson has to affect customer choice, though today's retail customers are undoubtedly more self educated. B) Frequently a customer would be looking at two equally priced, feature-similar cameras, but one would have a higher margin. Guess which cam that customer would usually buy? I'm certain the same practices are similarly taught at wireless retailers.

    In terms of social media, you're right; certainly there is imaging degradation to some level. But if I'm on Facebook looking at three out of state friends' pictures from their previous night's adventure, and two of them have uploaded blurry, grainy, dark iPhone pics but one has pics that are clear and vibrant from the same place, you know I'm intrigued, just like anyone else would be too. The lumia night demo images from the release looked really good, and if it can live up to somewhere near that image quality consistently, it would blow everything else, phone wise, out of the water even factoring in some resolution loss and upload compression.
    Sep 9, 2012. 03:43 AM | Likes Like |Link to Comment
  • Market Euphoria Continues As We Get Ready To Jump Off The Fiscal Cliff [View article]
    Fantastic article, and a lot of great insight on comments.

    In a macro sense, I see two situations and I openly admit I'm not totally sure how they reconcile. I'm not primarily an economist! First, I pretty plainly see deflationary pressures. Everyone's saving. Real estate may not have bottomed, and people won't buy until it does. I might see Japan! Certainly cash, in terms of an investment strategy and through the lens of "negative debt", looks really good in deflationary environments and we should clearly see the kingship of cash, especially when surrounded by so much debt. I consider the massive cash hoards on corporate balance sheets perhaps as a de facto deflationary play. And with looming economic contraction due to our debt problem, I see aggregate demand falling. I could go on... But secondly, it kinda looks like the most likely way out of our debt is printing money. I would doubt these forces are equally weighted to counterbalance each other; that's half-question, half-statement.
    Sep 9, 2012. 02:36 AM | Likes Like |Link to Comment
  • Nokia's Hail Mary Pass Fails [View article]
    Still see a lot of upside on Nokia though I sold at a loss today. Irritated the unveiling was incomplete; no release date, no carrier info, no prices, etc. The 920 has a chance because it will have features the iPhone will not, namely wireless charging (with virgin and coffee bean support) and NFC, but perhaps it's best awareness driver will come from imaging and social media; when early adopters' high quality pics/vids hit social media, people will start asking about which phone shoots that well and discover its Nokia, making it more likely to put one in hand at a store, leading to some amount of conversion rate.
    Sep 5, 2012. 06:59 PM | 2 Likes Like |Link to Comment
  • Facebook (FB) +1.9% AH after disclosing in an 8-K Mark Zuckerberg has no plans to sell any shares for at least 12 months. In addition, directors Mark Andreessen and Donald Graham have no plans to sell save for tax-payment purposes. All three will be eligible to sell following this fall's lockup expirations. Facebook also states it plans to report Q3 results on Oct. 23. (more on FB[View news story]
    let it rise on this news and buy em at the peak!
    Sep 4, 2012. 06:31 PM | Likes Like |Link to Comment
  • Facebook (FB) +1.9% AH after disclosing in an 8-K Mark Zuckerberg has no plans to sell any shares for at least 12 months. In addition, directors Mark Andreessen and Donald Graham have no plans to sell save for tax-payment purposes. All three will be eligible to sell following this fall's lockup expirations. Facebook also states it plans to report Q3 results on Oct. 23. (more on FB[View news story]
    Fantastic! At least 12 more months of uncertainty about when and how many of their shares come to market. Everyone already knew Zuck wouldn't sell much anyway. Don't have the numbers right in front of me, but looking at how, percentage-wise, this affects the looming lockup ending. My initial thought is a bad, or maybe even flat quarter obliterates any positive from this. Also, the sell rate of smaller insiders captures my attention the most, my thought is they ultimately determine if a lockup equals a crater. If the ship is sinking, why would you want to ride it down just because high level insiders are as well?
    Sep 4, 2012. 06:31 PM | Likes Like |Link to Comment
  • Monetizing Facebook's Users Could Be Quickly Accomplished [View article]
    Just went to login to my Facebook profile. The sign up section of the front page declares "It's free and always will be". I think it's unlikely we ever see any kind of paid version of Facebook concurrent with an ad supported free version. they wouldn't set themselves up for "it's technically not a backpedal" after prominently displaying such a statement that gets 60-ish million views per day. tried doing quick research on how long the front page has displayed this, its been there daily since at least 2011 if not earlier. that being said, i actually think it'd be an idea that many users could be receptive towards, especially because it would really be a tiny amount (little over a dollar/quarter) of money to replace the equivalent ad rev per user per year. so... great job, Facebook, painting yourself in a corner.
    Aug 29, 2012. 09:35 PM | Likes Like |Link to Comment