Archive for March 10th, 2010

5

Motorola Back To Innovating with Droid Smart Phone and Google OS

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By Relmor Demitrius -

By now product reviews, projected sales information based in some reality, and media input aplenty is out on Motorola Inc.’s new smart phone (NYSE:MOT), the Droid.  The Droid was the first smart phone to utilize Google’s (NASDAQ:GOOG) new Android 2.0 operating system, introduced as a direct competitor to the Blackberry and Iphone operating systems, as well as the Palm, which is reportedly not doing well.  With any technology that has fans that are loyal to other products, getting a real feel for consumer sentiment on any new technology is risky at first, and best left instead to time.  Enough time has now passed for a good feel on this phone to be achieved.  Sales numbers appear to be decent to good.  The reviews on the phone itself are mixed, but mostly positive.  It has been as boldly called the Iphone Killer (which is ridiculous) to a washed up attempt to catch up in the smart phone space that is going to fail miserably(even more ridiculous). What is that old saying?  Somewhere in the middle lies the truth?  I think that is exactly the case here.

I don’t think the phone will be a failure, but the Droid has much competition, even within the same Android 2.0 market it uses to run its phone.  Since HTC offers the same operating system (OS) at the same dealers as does the Droid, there is competition even amongst the OS users themselves.  Imagine two very similar phones called the Blackberry and the Redberry, each phone basically the same.  Of course it would affect sales of the Blackberry.  Not only does Motorola have to compete with other smart phones, it has to compete with other smart phones running the same OS as they are.  Was Motorola blindsided when Google released and marketed heavily its version, the Nexus One?  Maybe, maybe not.  Would Motorola had done anything differently anyway?  Probably not.  Regardless, they did the right thing partnering with Google. 

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8

Vanguard/MFC Global Add to Their Positions In Sirius XM Radio

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By Relmor Demitrius -

As reported in recent weeks, institutional ownership in shares of Sirius XM Radio (NASDAQ:SIRI) have been increasing.  This is especially significant due to the distressed price levels the equity was experiencing and institutional interest in a stock that is bottoming is crucial in gauging street sentiment going forward.  Basically the thinking is this,  if an institution doesn’t want to buy a stock when its under $1, maybe you shouldn’t either.

As these reports are sometimes not arriving until 2 months or more after the actual purchase of the stock, it would behoove one to be careful and diligent when interpreting this information.  Many factors should also be considered when looking at an institutional ownership report.  What was the price action during that period versus current prices?  Was the stock in an uptrend or downtrend? What does the fund do?  Is this fund the end holder?  Do they tend to trade or invest in the company?  What is this funds trading pattern with the equity?  As you can see this is no exact science.

Reports from Q4 institutional holdings are now arriving.  I try to focus only on the top holders, and in this equity I am looking at institutions who hold more than 10 million shares.

Vanguard Group, Inc. has added 6.3 million shares in the fourth quarter of 2009.  They already held 153 million shares before this addition in Q4, and were their largest shareholder, not counting of course the 40% preferred stake Liberty Media, through Liberty Capital (Nasdaq:LCAPA) owns in the company.

Vanguard first added large amounts of shares in Sirius XM Radio on the Q3 report in 2008, well after the merger financing was known about, and before so many recent improvements in the balance sheet have been made.  Vanguard was a believer apparently in the business model of the combined companies from day 1.

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