Go buy it....only at a Gamestop of course! I went and bought it. A little pricey at $59.99 but the clerk told me they are selling like "hot cakes".
I will be honest, I got a XBOX 360 and rarely play it. Now that I have more time on my hands, I joined XBOX Live and plan on devoting most of my life to it (kidding). I normally just play sports games like Madden, FIFA, NBA Live, but every once in a while, I will buy some games like Guitar Hero, etc. I will be honest, I think this UFC game is probably the best fighting game I have ever played. If you think I am lying, go rent it first. The game is very easy to learn, even for a novice XBOXer like myself. Right now my favorite fighter is Frank Mir, second probably rampage. I haven't started the "Create a Fighter" mode yet but will do soon. I am too busy trying to learn the basics the Exhibition mode. Anyways, if anyone has played the game, feel free to drop a comment and give me some tips. I am being serious, when I get taken down, I get murdered and get very pissed. Please advise!
Saturday, May 23, 2009
THQI Notes from Conference Call
Profitability Plan (catalysts)
1. $50 Annual Savings in SG&A expenses
2. Product development costs will be cheaper
3. Lower software amortization charges
4. Improved gross margins based around fewer units and higher selling prices (Ex. UFC cost me $59.99!)
FY 2010 Estimates compared to FY 2009
Q1 – Up; Q2 – Down; Q3/Q4 – Flat
FY 2010 Product Lineup
1. Red Action Gorilla (strong review with demo launch) 2. Darksiders
Proportion of Revenues
55% revenues off licenses, 45% revenue of personally owned
Product Categories
1.Fighting Games – Core/Top money maker, UFC and WWE
2.Kids Games – Aimed at Nintendo Wii/DS (new games will be Spongebob and CARS)
3.Family Games
Other Notes:
- UFC and WWE are two big games. Each will be heavily marketed; however, brands will not interconnect.
- UFC demo is in top 1% of all downloads for Microsoft Live!!!!!!!!!!
- 2010 will be profitable and has positive FCF.
- Secured $35 million credit line with Bank of America in case they need cash
- $141 million in cash/short-term investments as of March 31, 2009 (only declined $4 million and that was spent on restructuring costs, to improve operations).
- Short-term debt between $9-10 million (No long term debt)
- Working on launch with Shanda Interactive in China on Company of Heroes game. Shanda covered all investment and is waiting China government approval. (Revenues are not forecasted in numbers)
1. $50 Annual Savings in SG&A expenses
2. Product development costs will be cheaper
3. Lower software amortization charges
4. Improved gross margins based around fewer units and higher selling prices (Ex. UFC cost me $59.99!)
FY 2010 Estimates compared to FY 2009
Q1 – Up; Q2 – Down; Q3/Q4 – Flat
FY 2010 Product Lineup
1. Red Action Gorilla (strong review with demo launch) 2. Darksiders
Proportion of Revenues
55% revenues off licenses, 45% revenue of personally owned
Product Categories
1.Fighting Games – Core/Top money maker, UFC and WWE
2.Kids Games – Aimed at Nintendo Wii/DS (new games will be Spongebob and CARS)
3.Family Games
Other Notes:
- UFC and WWE are two big games. Each will be heavily marketed; however, brands will not interconnect.
- UFC demo is in top 1% of all downloads for Microsoft Live!!!!!!!!!!
- 2010 will be profitable and has positive FCF.
- Secured $35 million credit line with Bank of America in case they need cash
- $141 million in cash/short-term investments as of March 31, 2009 (only declined $4 million and that was spent on restructuring costs, to improve operations).
- Short-term debt between $9-10 million (No long term debt)
- Working on launch with Shanda Interactive in China on Company of Heroes game. Shanda covered all investment and is waiting China government approval. (Revenues are not forecasted in numbers)
Friday, May 22, 2009
GM Bankruptcy
Here is the new layout of the GM "organizational change"
50% - Government
39% - UAW
10% - Bondholders
1% - Equity Holders
Bottom Line: This will affect business in a big way. Bondholders like Pimco's Gross are vital to businesses that need to raise capital. This deal is so unfair to the bondholder's that it will make institutional bondholders second guess every deal,. In my view, this will raise the cost of capital for many firms and make it more difficult to achieve.
Let's be real, this is ABSURD. The bondholders have $29 billion of the company and are only getting 10% of that ($2.9 billion), compared to the UAW, owns $20 billion and it getting 35% of that ($7 billion)! How fair is that people?
50% - Government
39% - UAW
10% - Bondholders
1% - Equity Holders
Bottom Line: This will affect business in a big way. Bondholders like Pimco's Gross are vital to businesses that need to raise capital. This deal is so unfair to the bondholder's that it will make institutional bondholders second guess every deal,. In my view, this will raise the cost of capital for many firms and make it more difficult to achieve.
Let's be real, this is ABSURD. The bondholders have $29 billion of the company and are only getting 10% of that ($2.9 billion), compared to the UAW, owns $20 billion and it getting 35% of that ($7 billion)! How fair is that people?
THQI & GME
Listening to GME conference call now, it says UFC game will be top 3 selling game for 2Q 2009!
Conference Call Highlights:
-Europe slowing but used game biz is picking up
-2Q has no hardware price cuts built in estimates but are built in 3Q/4Q hardware sales estimates
-possible wii price cut as well
-Batman game reduce 2Q guidance because of release date moved to Sept
-Margins still did well
-Hardware sales are key weakness
-CEO says hardware manufactuers will have to reduce prices to meet expectations
-Last year's stimulus checks helped moved hardware, this year they don't have that; therefore, price cuts are needed
-Wal-Mart putting kiosk in stores for videos games as competition, no fears yet...
-Margins for platforms haven't changed. Europe refurbishing centers are improving and will be able to take more used hardware.
-New product base in second half and used games will drive their year. Bioshock 2, Madden, Call of Duty, Modern Warfare, Guitar Hero, Batman, etc. (All in all, they are betting on 3Q/4Q to make their FY EPS).
I will be back this weekend with Goldman Sach's View, Sterne Agee's View, and then more importantly my view (kidding).
Conference Call Highlights:
-Europe slowing but used game biz is picking up
-2Q has no hardware price cuts built in estimates but are built in 3Q/4Q hardware sales estimates
-possible wii price cut as well
-Batman game reduce 2Q guidance because of release date moved to Sept
-Margins still did well
-Hardware sales are key weakness
-CEO says hardware manufactuers will have to reduce prices to meet expectations
-Last year's stimulus checks helped moved hardware, this year they don't have that; therefore, price cuts are needed
-Wal-Mart putting kiosk in stores for videos games as competition, no fears yet...
-Margins for platforms haven't changed. Europe refurbishing centers are improving and will be able to take more used hardware.
-New product base in second half and used games will drive their year. Bioshock 2, Madden, Call of Duty, Modern Warfare, Guitar Hero, Batman, etc. (All in all, they are betting on 3Q/4Q to make their FY EPS).
I will be back this weekend with Goldman Sach's View, Sterne Agee's View, and then more importantly my view (kidding).
Market Wrapup
Have a good weekend and check back over the weekend for research. Take care and catch yall Tuesday!
RF Sell LEA
Sold my last 500 LEA at $1.51 - I am concerned about the GM bankruptcy and a long weekend...I still believe in the chart....will be back later
RF Cover BIDU
Covered Bidu short at $239.52, +$6 per share gain.......will back in but want to make sure that Mr. Gates doesn't decide to buy this one over the holiday weekend.
S&P Prediction
I am sick of the bears, I'm calling here and now.
S&P 500 hitting 1,050 by Labor Day 2009.
Feel free to hold me accountable!
S&P 500 hitting 1,050 by Labor Day 2009.
Feel free to hold me accountable!
GME
http://www.gamesindustry.biz/articles/gamestop-expecting-ps3-wii-price-cuts-in-q3
GME expecting Wii and PS3 price cuts, which will help hardware sales.
GME expecting Wii and PS3 price cuts, which will help hardware sales.
Market Outlook
Futures seem to be up, so expect one of two things:
1. Short squeeze on low volume
2. Pressure short selling on low volume
All of the hot shots are gone to the Hampton's today and the mice are playing. If there are some strong, big dolla bulls out there, we can easily squeeze back to 900 on the S&P. With my cash yesterday, I took positions in retail, via LOW and GME. LOW is a short-term play but they are better than HD (in my view). GME is ridicously oversold in my view. With an RSI at 28 and volume over 7x the average, we should see a good bounce today of 3-4%. If not I will buy more. I have been looking for a stock that i build a monster position in, that I really understand, and GME might be the one.
I will look at small caps today as well. Names like: LEA, STEM, XTEX, CTIC, HL, and BZ have great potential. I will trade around with them and hope we get some fuel today and they rip higher. I'm outta here, good luck, and catch you later.
1. Short squeeze on low volume
2. Pressure short selling on low volume
All of the hot shots are gone to the Hampton's today and the mice are playing. If there are some strong, big dolla bulls out there, we can easily squeeze back to 900 on the S&P. With my cash yesterday, I took positions in retail, via LOW and GME. LOW is a short-term play but they are better than HD (in my view). GME is ridicously oversold in my view. With an RSI at 28 and volume over 7x the average, we should see a good bounce today of 3-4%. If not I will buy more. I have been looking for a stock that i build a monster position in, that I really understand, and GME might be the one.
I will look at small caps today as well. Names like: LEA, STEM, XTEX, CTIC, HL, and BZ have great potential. I will trade around with them and hope we get some fuel today and they rip higher. I'm outta here, good luck, and catch you later.
Thursday, May 21, 2009
RIMM
Source: RIMM Estimates, Goldman Sachs ResearchLast night I ran into a some old friends while I was out and within minutes they were bombarding me with questions on their stock portfolio and what they should do, do you like XYZ, what do think of the market, etc. Finally, one of them asked me a question regarding analysis, particulary what I look for. Without hesistation, I answer him with "forward looking catalysts". During earnings, many people look for a firm's EPS and see if they beat or miss but the pros don't focus too hard on the EPS but rather guidance (forward looking). Anyways, the point of the story is that I look for catalysts that move stocks and tonight I present my case for RIMM.
RIMM has been a monster stock over the past few years but many wonder if the growth can continue. Above are some estimates that Goldman Sachs put together; however, I will discuss some qualitative catalysts that can fuel RIMM higher.
1. Cisco - RIMM Mobile Voice System Agreement- This agreement will allow RIMM to expand to services beyond wireless e-mail. There is a low blackberry penetration (2%) for the current top 9,500 customers, so with this partnership, it can give RIMM an way to increase that.
2. More Agreements to Come - RIMM got partnerships with Cisco and HP but could be in talks with IBM and SAP to develop more opportunties to expand their offerings. This will help blackberry expand their footprint.
3. Opportunties in Healthcare - The Obama Adminstration is demanding that the healthcare system provide more efficiency. The efficiency require more and better IT standards, where files will be trasmitted electronically. Some states have required that doctors have Blackberrys, in case of emergency transmission of prescriptions or important medical records. There is a good chance that this will continue and many other people within the hospital have them as well.
4. New inventories will be needed - Many employers are using older blackberries and will need to upgrade them, so new software can be used. Technology spending is starting to bottom (great article in the WSJ on that last week), so RIMM can benefit.
Now to valuation. From a P/E perspective, it depends on what The Street assigns as a multiple. With a 18x mulitple on 2010 earnings, the stock is worth $85. APPL, a key competitor, is given a 23x mulitple, so if you believe they are equal, RIMM is worth $108. In my view, I think it's worth between $82-$88, so $85 sounds fair. It could hit $90-$94 on the high end because I believe big tech will be a popular place to go. I am not long yet, but will take a position soon.
EXM Crushes Estimates
Did you doubt me? RF wins again...in SIZE....the Dry Bulk Shipping King will not be denied! Another one for the "bad guys"
* Q1 EPS $2.57 vs yr-ago $1.76 * Voyage rev up 34 pct to $92.8 mln * Shares up 11 pct in after-market trade
May 21 (Reuters) - Greek dry bulk carrier Excel Maritime Carriers Ltd (EXM.N) posted a more than three-fold jump in first-quarter profit, helped by a 34 percent rise in voyage revenue, sending its shares up as much as 11 percent.
The Athens-based company reported a quarterly profit of $118 million, or $2.57 a share, compared with $35.1 million, or $1.76 a share, last year. Voyage revenue came in at $92.8 million.
According to Reuters Estimates, the company earned 95 cents a share, trumping analysts' average estimate of 9 cents a share, both of which excludes an unrealized swap gain, a gain from the sale of a vessel and amortization of favourable and unfavourable time charters.
Total revenue nearly quadrupled to $222.1 million. First-quarter revenue includes $129.1 million in non-cash revenue.
Excel Maritime said it secured 67 percent of its operating days for 2009 and 55 percent for 2010 under time charter employment.
May 21 (Reuters) - Greek dry bulk carrier Excel Maritime Carriers Ltd (EXM.N) posted a more than three-fold jump in first-quarter profit, helped by a 34 percent rise in voyage revenue, sending its shares up as much as 11 percent.
The Athens-based company reported a quarterly profit of $118 million, or $2.57 a share, compared with $35.1 million, or $1.76 a share, last year. Voyage revenue came in at $92.8 million.
According to Reuters Estimates, the company earned 95 cents a share, trumping analysts' average estimate of 9 cents a share, both of which excludes an unrealized swap gain, a gain from the sale of a vessel and amortization of favourable and unfavourable time charters.
Total revenue nearly quadrupled to $222.1 million. First-quarter revenue includes $129.1 million in non-cash revenue.
Excel Maritime said it secured 67 percent of its operating days for 2009 and 55 percent for 2010 under time charter employment.
RF Buys
HES @$60.30 - long term play
LOW @19.08 - long term play
cover AMZN @ $75.50, +2.45 per share gain!
Jan.2011 UYG $3.00 calls @1.75 - 3 contracts
*Also added 50 more GME at $21.25
LOW @19.08 - long term play
cover AMZN @ $75.50, +2.45 per share gain!
Jan.2011 UYG $3.00 calls @1.75 - 3 contracts
*Also added 50 more GME at $21.25
RF Buy DIG Calls
Bought 2 DIG $27 June Calls for $1.80
Play at your own risk (it's rather risky)
(Disclaimer: My options game has been a little weak recently w/ airlines and feed)
Play at your own risk (it's rather risky)
(Disclaimer: My options game has been a little weak recently w/ airlines and feed)
Market Update
A little selloff today, not surprised at all. I still have short positions in IFN, AZMN, GMCR, AND BIDU. I haven't sold anything today and added a little STEM (breakout play) and GME. GME guidance was brutal but after looking at the books, it's way too low. In addition, my "sources" are telling me that Sony is talking about Play station price cuts across the board. If that is true, GME will benefit. I also like their international exposure. The risk is AMZN because they are selling games online, which will bring strong competition.
Oil seems like it will not break $60. The dollar just had a huge reversal (within the past 30 minutes), sending gold over $950 an oz and firming oil prices. The natural gas sell off it monsterous! I will wait until UNG gets a 12-13 handle and I will then dabble. I am more than convinced that oil is going to $70 and I believe crude will hit $65 in the next 2 weeks. I am looking at the triple long ERX under $30 as a play on more oil names.
As for buying, I will probably not make anymore buys today because I believe we will have this same action until Tuesday. I will keep my technical plays out because they can breakout anytime, anywhere. I have a 35% cash position and I am ready to deploy but patience rewards. I will buy alot of options soon, so you options players, get the trigger ready.
Oil seems like it will not break $60. The dollar just had a huge reversal (within the past 30 minutes), sending gold over $950 an oz and firming oil prices. The natural gas sell off it monsterous! I will wait until UNG gets a 12-13 handle and I will then dabble. I am more than convinced that oil is going to $70 and I believe crude will hit $65 in the next 2 weeks. I am looking at the triple long ERX under $30 as a play on more oil names.
As for buying, I will probably not make anymore buys today because I believe we will have this same action until Tuesday. I will keep my technical plays out because they can breakout anytime, anywhere. I have a 35% cash position and I am ready to deploy but patience rewards. I will buy alot of options soon, so you options players, get the trigger ready.
Jobless Claims
Come out at 8:30a - if futures turn up strong into the green, I will cover all immediately.
Market Outlook
It seems like the market is going to pullback today. I saw a lot of shorting at the end of the day yesterday (rather than profit taking) hence my short of BIDU. I am about to open up two more short positions but will stay net long.
I think the lowest point is 875 on the S&P but watch the 20 day on the SPY. Great opportunity to buy dips in good names. On the short side, I would day trade and look for names that performed well on short squeezes. As a hedge, on could buy gold or silver names, particularly miners.
All in all, I have no idea where the market will end up. Just buy the dips and sell the rips.
I think the lowest point is 875 on the S&P but watch the 20 day on the SPY. Great opportunity to buy dips in good names. On the short side, I would day trade and look for names that performed well on short squeezes. As a hedge, on could buy gold or silver names, particularly miners.
All in all, I have no idea where the market will end up. Just buy the dips and sell the rips.
Wednesday, May 20, 2009
Market Wrapup
Another solid day but added short exposure and raised cash to above 35%. Oil is ripping and i like that sector the best. It represents over 20% of my long porfolio via DXO, DIG, WNR, FTK, and FRO. With the attacks going on in Iran, oil can skyrocket! On the short side, play it smart and look at names that have had huge runs because of short squeezes. I'm out, peace!
FEED
Congrats to Dennis, RT, and J. These guys love this stock and have been holding on for the ride! Nice job.
The Market
The market seems to be drifting, as financials begin to dip. I have no idea where the market is going and will not dry to guess. I know that we are getting overbought but it's not that great of a indicator. This market is no longer based on funadmentals in my view, it's based on supply and demand. Money mangers need to move into stocks and out of bonds because they need to make their year or lose all their accounts to a S&P Index fund. I like oil and own DXO, FRO, FTK, and WNR.
I am out and will be back later......probably won't buy anything else but you never know.
I am out and will be back later......probably won't buy anything else but you never know.
LEA
RF wins again!
Selling a third at $1.77 for 23% gain........still got a 1k
(i bought a boatload yesterday for a day trade and made a penny per share...only 1 more day and i would've been swimming!)
Selling a third at $1.77 for 23% gain........still got a 1k
(i bought a boatload yesterday for a day trade and made a penny per share...only 1 more day and i would've been swimming!)
XTEX
This thing could breakout! I bought some earlier....it has the "gold" stockcharts.com "glow" lol
Market Outlook
Futures seem to be flat right now, which is good but then again, it can change quickly. I thinned most of my positions yesterday but still have a lot of chips on the table. Still have monster positions in shippers, F, GIGM, and more. I will probably cut out of my FAZ today but if you choose to keep it, not a bad move. In my view, something like SRS or FAZ should not represent more than 5% of your portfolio (as a hedge). QID is a better hedge but frankly, I don't want to short this market.
Oil is a must watch today. The inventory report will be out at 10A and the data will be important because summer is coming; therefore, demand will be rising. The question is about the inventories. Many pros are trying to short crude but it's not a smart move in my view. I think we will probably see $70 before we see $45 or even $50.
I will try to disipline myself today by lowering the # of my purchases but there is no guarantees. I will post every move but hope we skyrocket again today. Frankly I was up way more yesterday than Monday, and the market closed flat.....go figure.
As for a few of my dogs, GIGM and FTK, I still own them. FTK can go higher but may need to raise capital first. With oil higher ($60+) it should be able to raise capital. GIGM is another dog but I am sticking by it and it's one of my biggest positions. I cost averaged in around $6.40 but will hold for bigger rewards.
As for technical trades, I like OXPS, CTIC, WFR, LEA, and AXL. The charts are below but then again, keep tight stops (8% rule of thumb). I know it sucks taking a loss but sometimes it's better to take a small loss than a big loss. The flag in CTIC reminds me so much of RUTH it's not even funny; however, it has way more risk.
Oil is a must watch today. The inventory report will be out at 10A and the data will be important because summer is coming; therefore, demand will be rising. The question is about the inventories. Many pros are trying to short crude but it's not a smart move in my view. I think we will probably see $70 before we see $45 or even $50.
I will try to disipline myself today by lowering the # of my purchases but there is no guarantees. I will post every move but hope we skyrocket again today. Frankly I was up way more yesterday than Monday, and the market closed flat.....go figure.
As for a few of my dogs, GIGM and FTK, I still own them. FTK can go higher but may need to raise capital first. With oil higher ($60+) it should be able to raise capital. GIGM is another dog but I am sticking by it and it's one of my biggest positions. I cost averaged in around $6.40 but will hold for bigger rewards.
As for technical trades, I like OXPS, CTIC, WFR, LEA, and AXL. The charts are below but then again, keep tight stops (8% rule of thumb). I know it sucks taking a loss but sometimes it's better to take a small loss than a big loss. The flag in CTIC reminds me so much of RUTH it's not even funny; however, it has way more risk.
Tuesday, May 19, 2009
Stocks Under $10 - ENTR
I am back with a stock under $10 pick - ENTR. If you are new to the site, I do these once a month and my track record is strong (archive for proof):
1st pick: TTWO +49% since call
2nd pick: TIE +67% since call
3rd pick: FEED +98% since call
I bring you ENTR. This stock is broadline semiconductor that has a great story that centers around set-top boxes. In short, they make the chips that goes in them. Verizon, Cox, and Time Warner are winding down on recent inventories and will be placing new orders soon for these DVR boxes, as cable is growing because of the cable transition. I believe this will greatly bring positive impact and boost incremental revenues for both 2009 and 2010 MoCA chip sets are in higher demand, not only in the US but also China. In addition, management is striving hard to improve gross margins to levels above 50%, which in my view is achievable if they make the chips and get them out the door (and of course get the orders - which I believe they will). Cash will burn a little harder throughout this year; however, their DSO is between 55-60 and inventories should improve. Revenue should grow about 60%+ from 2009E to 2010E, when will boost EBITDA by $25m. Based on these assumptions the stock, in my view is worth between $3-$5. Note, we have had a huge run up, so no need to go all-in but for a speculative stock, it's worth a look. Scale is key!
May the streak continue!
WFR
Ok, my last chart for the night. WFR is a interesting one. Closed right at resistance and had great volume today. In addition, it seems to be gaining strength, so I believe this could go to $19+. Not a 16% day gainer but hedge funds were do anything for a nice 2-4% day gain. With a decent market, it can run for a few points. (Also, WFR has cash ps levels that is equal to about 25% of the current stock price.
THQI Revisited
The top chart is today's action.
The bottom chart was yesterday's call.
Bottom Line: We win again! 16% day gains rock...
AXL
Similar formation. Keep tight stops but keep an eye on this, especially as it approaches the 200 day. This thing SWINGS HARD, so be careful. I'm long since yesterday at $2.16. But these small caps are very tiny % of portfolio.
LEA
I took a position today. Charts are not based on fundamentals but rather technicals. Once the chart fails, the trade fails. So, it's important to keep stops and bail before a small loss becomes a big loss. Also, note that charts are more likely to fail in a bad market. So, just keep that in mind.
Market Wrapup from Razor Ramon
I'm out
going to a meeting for the rest of day....will monitor picks but can't post.
Trust "the force" ....it will be with you.
Trust "the force" ....it will be with you.
HYC
Weak price action, might cut it for a day loss. I have little tolerance for small caps! They can blow up in your face, if you don't want them with 2 eyes!
CNTF
If you can bare the risk, these guys report after the bell. Chart shows rounded bottom and earnings could surprise. Play at your own risk!
OXPS
Forgive the typo in the box above, *show needs to be "should". Firm has $9 cash per share and looks like it can have another leg up on the chart.
Market Outlook
Market looks like it could have some steam but things can change any minute. HD had some good numbers but they said there is still some problems with consumer spending. I will listen to the conference call and see what's up. As I am typing I see that oil just hit $60 a barallel. DXO is a good play on crude but accumulate on dips.
As for my buys, I will stay patient and look at some of the names below. I am in no rush to buy but will post when I do. My watchlist has about 50 names on it, so I am more concerned with the tape because weak tape (lingo for market) can hurt technical plays.
Good luck and I will be back later.
Note: KLIC and BUCY are also on my list.
As for my buys, I will stay patient and look at some of the names below. I am in no rush to buy but will post when I do. My watchlist has about 50 names on it, so I am more concerned with the tape because weak tape (lingo for market) can hurt technical plays.
Good luck and I will be back later.
Note: KLIC and BUCY are also on my list.
Monday, May 18, 2009
THQI
The big UFC game comes out tonight and THQ looks like it is on a mission higher. RF will be picking up a copy of the game tomorrow and will be playing it for hours. In addition, I believe the stock looks like it will breakout. My technical playbook has been fairly HOT and this needs to be thrown on your radar. I have no position yet but see my comments above in the chart. Fundamentally, the stock is probably close to priced in $5.50-$6; however, that depends on the success of the UFC game. The company is cash rich with 46% of current stock price, representing nothing but cash!
Bottom Line: THQ has been upgraded by the Bank of RF to Buy...$5.75 fundamental price target, $6.50 technical price target.
CHINA: FMCN & GIGM
(click to enlarge) - Source: Stern AgreeChina's MACRO story remains story but I have been looking towards the consumer front. Retail sales in April were up 15% YOY. Cars were up 19%, necessities were up 15%, and clothing was up 14%. Nielsen surveys also indicate that consumers believe that it is a great time to spend on travel, clothing, and advanced technology.
Above is a snapsnot of China's internet plays/entertainment/media. The list includes FMCN and GIGM, which I own. The valuations look VERY cheap! Patience is the key because not many money managers know this story.....YET.
FMCN
Thankly FMCN was my runner today. Below is the story of why....
http://www.jlmpacificepoch.com/newsstories?id=148240_0_5_0_M
http://www.jlmpacificepoch.com/newsstories?id=148240_0_5_0_M
Market Wrapup
Big day for the indexes today, with the S&P ripping 26 pts today. One biggest catalyst was from LOWE's but the other came in Financials. Star analyst Dick Bove came out and said the bank index couple triple from these levels! In addition, BAC was upgraded by Goldman, which was a big wave of bullish.
The VIX close below 30 today and the last time that happened, we had a 6% up day during the next trading day. We shall see what tomorrow brings but the market seems strong. 875 on the S&P is key support and the S&P futures bounced from that level this morning and closed at 907.
As for today, my portfolio was fair but nothing too special. My only hedge is the ETF of death, FAZ, and it got wacked pretty good. Other than that, I am long with about a 30% cash position. I added WNR for refining play and OXPS has a flagging chart with $9 cash per share. I like the odds. AXL is a high speculative small cap, with a good chart, and I hope it will rip. I put a $2 stop because I refuse to take another small cap beating. CTIC is one I have been looking at too but it's biotech. Beware of biotech because you can lose body parts (it's that damn explosive). However, it looks like a lotto ticket. At $1.30, I see it going to $.80 or to $2.50-$3. Play at your own risk. FTK, ATHR, and GIGM remain dogs but I still own them.
For investors with a long time frame and portfolio, I like HESS and COP. I think COP is probably worth $55 or 60 and HESS is worth $70. When it will get there, I don't know. COP has strong exposure to natural gas and HESS can refining capabilities. Both benefit from higher crude prices, especially HESS. Everytime crude goes up a $1, HESS's EPS increase by 19 cents.
I also continue to like semiconductors. Upgrades are everywhere. SPIL, TER, CIEN, ATHR, XLNX, FCS, RFMD, STM, MRVL and INTC are individual names. A levered (2x bull) ETF is USD. For less risk and for a long-term play, XLK is a broad etf that will get you long tech.
The VIX close below 30 today and the last time that happened, we had a 6% up day during the next trading day. We shall see what tomorrow brings but the market seems strong. 875 on the S&P is key support and the S&P futures bounced from that level this morning and closed at 907.
As for today, my portfolio was fair but nothing too special. My only hedge is the ETF of death, FAZ, and it got wacked pretty good. Other than that, I am long with about a 30% cash position. I added WNR for refining play and OXPS has a flagging chart with $9 cash per share. I like the odds. AXL is a high speculative small cap, with a good chart, and I hope it will rip. I put a $2 stop because I refuse to take another small cap beating. CTIC is one I have been looking at too but it's biotech. Beware of biotech because you can lose body parts (it's that damn explosive). However, it looks like a lotto ticket. At $1.30, I see it going to $.80 or to $2.50-$3. Play at your own risk. FTK, ATHR, and GIGM remain dogs but I still own them.
For investors with a long time frame and portfolio, I like HESS and COP. I think COP is probably worth $55 or 60 and HESS is worth $70. When it will get there, I don't know. COP has strong exposure to natural gas and HESS can refining capabilities. Both benefit from higher crude prices, especially HESS. Everytime crude goes up a $1, HESS's EPS increase by 19 cents.
I also continue to like semiconductors. Upgrades are everywhere. SPIL, TER, CIEN, ATHR, XLNX, FCS, RFMD, STM, MRVL and INTC are individual names. A levered (2x bull) ETF is USD. For less risk and for a long-term play, XLK is a broad etf that will get you long tech.
Market
LOW's smoked numbers sending the S&P higher. The next phase will be tomorrow with Home Depot. It is likely that HD will post good numbers but their outlook will be vital for the market. Homebuilder Sentiment bumped up again at 16 (second straight bump). Housing is what got us here, so it will bring us out. On the long side, I am buying a few things but like energy and commodoties here. Oil is up 3%+ today and I think it will continue. I bought my WNR for a play on the crack spread. XLE and ERX (triple leverage) are broader etf plays on oil. In my view, Oil could cripple our economy if something isn't done. Data just released shows that the biggest buyers on crude futures are BANKS lolll. GS and MS are loading up and want to take on the risk again, so I like crude here.
Good news coming across today. LOW had a great quarter and raised guidance. In addition banks seem to be pumping good news as well. BBT says that they just filed reports to repay tarp, as well as State Street. BAC got added to Goldman Sach's conviction buy list with a $15 price target. Also, keep an eye on semiconductors, big upgrades for TER, MRVL, and STM. I like USD for the long-term as a levered, broad play. India shot off huge last night with election of the new prime minister. The India market was up 17% last night (one-day) and was halted lolll. REDF and IFN are speculative plays but it's hard to tell if it's a one-time pump and dump. I'm mixed on the tape, if I had to buy anything, I would buy semiconductors, refiners, and XHB calls. Be back later
Sunday, May 17, 2009
MS
Interesting Article I read over the weekend, regarding the financial health of Morgan Stanley.
http://dealbook.blogs.nytimes.com/2009/05/08/egan-jones-takes-dim-view-of-morgan-stanleys-health/#more-59349
http://dealbook.blogs.nytimes.com/2009/05/08/egan-jones-takes-dim-view-of-morgan-stanleys-health/#more-59349
Strategy for this Week
The strategy is no longer "buy microcaps that go up 60% in 2 days". It's now, fight for survival. The market is at a pivotal point and will shoot 50 points on the s&p either way, very soon. The big data comes this week via HD on Tuesday. Home Depot posts quarterly results and their outlook on housing will be vital to the market's next move. Housing is what got us into this mess and will be what pulls us out of this mess. I will be on the HD call Tuesday morning and will be listening hard. Lowe's reports tomorrow but in my view, they are geared more at the consumer, not homebuilders, so I am leaning more weight on HD.
Going forward, I don't think we will retrace to 666 on the S&P but many bears are calling for 6,000 on the DOW. It's possible but I highly doubt it. How far we go, seriously depends on how much fear will be created in the market. The VIX is at 33 and if we see a 3 or 4% downward move in the market, the VIX will print 40, creating a 7 point day move. The volatility is not bad yet but it could pick up.
I will be adjusting some of my positions for 6 months out. In addition, I will be accumulating ETF's aimed at particular sectors and select emerging markets, as well as using LEAPs strategy to play select sectors. I don't want to get to detailed yet but will post my buys and thesis behind it soon.
I think the "reflation" trade will be big during the next 12-18 months; therefore, I will weight more portfolio towards oil, basic material, and commodities. In addition, I will purchase gold bricks and buy a safe to hoard them in (kidding but not really). Gun sales are through the roof and Beretta said that alot of their handguns are backorder through 2010! SWHC and RGR are both up triple digits and may move higher. I have been looking at CAB but haven't made a purchase yet. CAB is up huge from yearly lows of $4 to over $12 now. However, insider buying is going on with one director purchasing $2 million worth of stock over $13.50 a share. Cabela's is a big player and it might be worth a shot.
Lastly, I am not a market predictor but have timed things well so far this year. Last week was my worst week of 2009 because I was loaded in small caps and most of my profits fell off a cliff. I will probably dump most of my small junk (BEE, FMCN, and GMO). FTK and SFE are on the tight walk but SFE is a value play where most of their investment portfolio seems very undervalued. I posted my views on FTK on Friday (scroll below). I am keeping the small junk, just in case shoot back to 925, I have some bullets in the market and they will explode back higher. I have a high cash position and am ready to deploy capital like a "madman". I
Going forward, I don't think we will retrace to 666 on the S&P but many bears are calling for 6,000 on the DOW. It's possible but I highly doubt it. How far we go, seriously depends on how much fear will be created in the market. The VIX is at 33 and if we see a 3 or 4% downward move in the market, the VIX will print 40, creating a 7 point day move. The volatility is not bad yet but it could pick up.
I will be adjusting some of my positions for 6 months out. In addition, I will be accumulating ETF's aimed at particular sectors and select emerging markets, as well as using LEAPs strategy to play select sectors. I don't want to get to detailed yet but will post my buys and thesis behind it soon.
I think the "reflation" trade will be big during the next 12-18 months; therefore, I will weight more portfolio towards oil, basic material, and commodities. In addition, I will purchase gold bricks and buy a safe to hoard them in (kidding but not really). Gun sales are through the roof and Beretta said that alot of their handguns are backorder through 2010! SWHC and RGR are both up triple digits and may move higher. I have been looking at CAB but haven't made a purchase yet. CAB is up huge from yearly lows of $4 to over $12 now. However, insider buying is going on with one director purchasing $2 million worth of stock over $13.50 a share. Cabela's is a big player and it might be worth a shot.
Lastly, I am not a market predictor but have timed things well so far this year. Last week was my worst week of 2009 because I was loaded in small caps and most of my profits fell off a cliff. I will probably dump most of my small junk (BEE, FMCN, and GMO). FTK and SFE are on the tight walk but SFE is a value play where most of their investment portfolio seems very undervalued. I posted my views on FTK on Friday (scroll below). I am keeping the small junk, just in case shoot back to 925, I have some bullets in the market and they will explode back higher. I have a high cash position and am ready to deploy capital like a "madman". I
Gas Prices Up - Time to Get Long Refiners!
I came back from church today and filled up my car. RF is an avid Dr. Pepper fan, so I swiped my card, put the trigger in and let it roll, while I went to get a soda. After getting my soda, I came back to my car and put the trigger back, to notice that my gas bill at $39! Given that I was on empty, it normally costs $30-32 to fill it up! I immediately balled up the reciept, threw in my car, and came home to research this.
After being killed for a while, both gas station owners and refiners are out to "milk" us. Right now, the wholesale gasoline futures are about $1.75 a gallon. In terms of oil price per gallon, it is about $1.45-1.50 per gallon, representing a "crack spread" of about $.25 margin per gallon! Before, refiners had negative margins and were lucky to get a few cents, now they are trying to push as many gallons through as possible, with these 17% margins! If this can hold, which I believe it can, it's time to get long refiners for a "trade" not "investment".
Refiners do not have strong fundamentals; however, many are heavily shorted and a squeeze can occur. My refining list is below, play with stops!
ALJ = 14.44% short interest
DK = 11% short interest
FTO = 4.9% short interest
MRO = 1.4% short interest
TSO = 12.8% short interest
VLO = 2.9% short interest
WNR = 13.5% short interest
Top Pick: WNR (former RF favorite since March at $10)
After being killed for a while, both gas station owners and refiners are out to "milk" us. Right now, the wholesale gasoline futures are about $1.75 a gallon. In terms of oil price per gallon, it is about $1.45-1.50 per gallon, representing a "crack spread" of about $.25 margin per gallon! Before, refiners had negative margins and were lucky to get a few cents, now they are trying to push as many gallons through as possible, with these 17% margins! If this can hold, which I believe it can, it's time to get long refiners for a "trade" not "investment".
Refiners do not have strong fundamentals; however, many are heavily shorted and a squeeze can occur. My refining list is below, play with stops!
ALJ = 14.44% short interest
DK = 11% short interest
FTO = 4.9% short interest
MRO = 1.4% short interest
TSO = 12.8% short interest
VLO = 2.9% short interest
WNR = 13.5% short interest
Top Pick: WNR (former RF favorite since March at $10)
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