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The Curious Contrarian  

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  • Huge Upside Potential Makes Zynga A Good Long-Term Investment [View article]
    Zynga is a show-me story at this point with good short-term optionality if they can launch a new game that the company can monetize well. However, their relationship with Facebook has deterred over time (they are no longer a preferred partner as of late 2012) and they've yet to launch a hit game worthy of changing investors' perceptions of the company since. Until they can break out of this slump meaningfully there won't be anything more than a short-lived rally. Structurally though, there's little to like about Zynga since the barriers to entry are relatively low on mobile games, product cycles are both hit-and-miss and extremely short with regards to monetization, and their cost restructuring still has a ways to go before it reflects the cyclical nature of their revenues.
    Aug 23, 2013. 12:31 PM | Likes Like |Link to Comment
  • 5 Reasons Why I'm Short Tesla [View article]
    Most of these arguments could have been made at any time during Tesla's rally and would have proven ill-timed. I agree with you on point #2 but none of your other points are particularly actionable, which is incredibly important when you're recommending investors short a company that is still prone to a short squeeze and isn't showing any signs of letting up in its dominance of a structurally growing market. Tesla could see some profit taking in the event of a broader market sell off, but it won't sell off on company specific issues in the near term unless it misses earnings or delays the Model X. Therefore, like many before you, I don't think your short thesis will hold up since it relies more on pointing out possible long-term issues with an admittedly "expensive" company but lacks a concrete catalyst.
    Aug 21, 2013. 08:52 AM | 9 Likes Like |Link to Comment
  • Broadcom: Apple iPhone 5C And 5S Could Drive Shares Back Above $30 [View article]
    BRCM is facing increasing competitive threats from heavy hitters like QCOM and MRVL and potential in-sourcing (if Apple or Samsung bought Texas Instrument's connectivity business which appears to be the case). Therefore, its connectivity business is at serious risk of losing share, which would result in serious earnings downgrades. Furthermore, its baseband business isn't gaining much traction, as seen by its relative lack of meaningful design wins to date. QCOM is still the king in this space, and other fabless players are doing well address the mid and low ends of the market, leaving BRCM with little. Ultimately, BRCM is a trade on product cycles at this point, since share gains aren't likely, margins could get squeezed, and competition is getting much worse.
    Aug 21, 2013. 08:51 AM | Likes Like |Link to Comment