Archive for August, 2010

2

Relmor’s Pick of the Week: Syntroleum Corporation

By
king1
– August 30, 2010
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SYNMBy Relmor Demitrius

 

On Friday the Federal Reserve eased deflation fears and vowed to do whatever it took to avoid prolonged deflation.  As it is the job of the banking system to defend deflation at all cost within a Keynesian economic system, this news of course is not surprising.  As investors look for better gains ahead, and bonds are beginning to be pricey, there are other ways to play the inflation move and dollar weakness.  Oil is a great play for a weak dollar as renewed signs of economic recovery take hold, and a high beta stock like Syntroleum Corp (NASDAQ:SYNM) may be the traders best way to short term profit on the easing of deflation fears.  Looking for stocks that are making medium term bottoms I noticed a bottoming pattern in SYNM.  If this plays out to the upside, and $1.50 support holds, there is a better than average shot at a trend line hit around the $1.90 area.  This week should see some buying pressure on this equity as the company recently sold shares for $1.90 and the shares were only slightly dilutive.  The company is equity responsible, with still only 78 million shares outstanding.  Issuing 1 million shares is less than 2% in added dilution, discounting the current price of $1.55.  Looking at my chart posted here you can see where I circled on the lower trend line hit of my wedge pattern support.  This is holding so far.  We will look back on this equity in a week and see how it fared.  As with all trading, do your own due diligence and follow your own plans and strategies.  This is not a recommendation to purchase this or any other equity.

 

Disclosure:  No Position SYNM

 

For commentary and forum discussions on all trades and investments, visit www.kingofalltrades.com.

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3

Google Aims A Cannon At Skype

By
Gino Lattarulo
– August 30, 2010
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By: Gino Lattarulo

Google-KingWhen I was in the military during the early 90′s I can remember racking up disturbing amounts of long distance charges talking with my family and girl friend (mostly my girl friend) each month. Cell phone plans were still in their infancy and each minute cost more than a gallon of gas. Remember the “Brick” phone? Yeah, that baby cost four grand when it first came out. Nowadays cell phones plans are so cheap they are replacing traditional landlines. I admit it, I have no traditional  ”home” phone. Phone companies like Verizon (NYSE:VZ), AT&T (NYSE:T), and Time Warner (NYSE: TWX) who had recognized this trend began offering unlimited home Voice Over Internet Protocol (VOIP) plans, and voila, Talk is literally cheap.

Enter Skype:  Well, actually Skype is one of the pioneers of the VOIP revolution and is one of the main reasons phone companies had to jump on board in the first place.  In 2004 when VOIP became commercially accepted as a viable source of communicating, companies like Skype and Vonage became innovators in marketing the service to consumers.  Vonage (NYSE:VG) went public a few years ago with their broadband modem format and now Skype is jumping on the IPO bandwagon with their proprietary software based system. Skype to Skype calls are free while traditional calls are pennies per minute.

Enter Google Inc. (NASDAQ:GOOG):  Once again it looks like the mega giant of the Internet is doing everything to continue its omnipotent presence. As Skype nears IPO status, Google has recently launched a free VOIP service from within Gmail that offers free calling to any phone or phone number in the United States and Canada.  Perfect timing don’t you think?  Although  Google Voice will have little effect on the Google’s income structure, if embraced widely enough it will almost certainly pose a disturbing threat to Skype who charges $.02 per minute for domestic calling and relies on those charges to support their business.

As  Google continues its path toward world domination, it will be a mind bending experience to say the least to see which companies it simply gobbles up and which ones are just pounded into dust.  With pockets so deep they have mold growing on the cash, Google can pretty much do what it wants.  And it does.

Disclosure: No positions in GOOG and VG

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5

Sirius XM (NASDAQ:SIRI) Liberty Capital (NASDAQ:LCAPA, LCAPB) and Worldspace Revisited

By
Andrew Montero
– August 30, 2010
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globexmsiriusbig

In the weeks since the final bankruptcy sale and approval of Worldspace assets to Noah Samara; this time through Yazmi LLC, one thing is abundantly clear.  The plight of all the assets of Worldspace and SATCO is as yet unknown and still awaiting a final outcome.  Court documents prior to final sale stated that the consideration to be received from Yazmi in the sale purchase agreement would not be sufficient to pay Liberty Satellite Radio and Liberty Satellite Radio Holdings in full.  The Debtors estimated that Liberty’s aggregate secured claims were in excess of $116 million dollars.  Under the settlement agreement, the Debtors were released from such claims and the corresponding liens, allowing the Debtors to distribute the proceeds of the sale to other creditors.  In exchange for that, the Debtors and the other Parties to the settlement agreement provided releases to Liberty, and Liberty received other consideration.  That “other consideration” was Liberty obtaining a return of $370,000 in funds which the debtors transferred to Liberty; that Liberty had loaned to support the WorldSpace Italia subsidiary.  When Liberty decided not to pursue a Liberty purchase agreement, the need for those funds evaporated. Liberty also received $250,000 of the Yazmi sale proceeds, which was 5% of the total and significantly less than Liberty would have gotten if its senior secured claims were still in effect.  The Debtors believe that the note from WorldSpace Italia that Liberty received is of little value; the Debtors also believe WorldSpace Italia cannot repay that note, and the Debtors themselves have limited resources with which to possibly pursue collection.  The Debtors were willing to relinquish their right to abandon their responsibilities and their assets to Liberty in exchange for Liberty’s relinquishment of much

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16

Sirius XM and Howard Stern: Five Years Later/Part One

By
king1
– August 26, 2010
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Mel and Howard

Mel and Howard

By Relmor Demitrius

 

The day Howard Stern signed with Sirius Satellite Radio, the radio landscape was changed forever.  I think we can all agree that with this decision in 2005, to some degree at least, radio did indeed change.  To what degree and what lasting affect did it have might be debatable.  The biggest celebrity on radio and considered the most talented voice on radio, well, wasn’t on traditional radio anymore.  There was a new format in town.  Commercial free radio that could be heard anywhere in the country.  Satellite radio (SATRD) would change how people listened to the radio forever.  But how did Howard Stern change radio?  To what extent?  Is this a lasting change or a minor hiccup in the history of terrestrial radio?  Is the norm for radio soon to be satellite delivery?  Would more and more talent move from traditional outlets into this latest technology?  Five years later we can begin to answer these questions. 

On the tail end of Howard Sterns first contract with Sirius XM Radio (NASDAQ:SIRI) is a good place to stop and consider just what  the affect was of his signing and how the future looks  with or without Howard Stern.  In this first part of a three part series of articles I will delve into this topic and cover different angles to these questions.  I would like to first lay some groundwork on Howard Stern and present some facts that might improve our understanding of Stern, Sirius XM, radio in general and the relationships these three entities share.

How did Howard Stern even come to be on Satellite Radio?

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5

Sirius XM Rates A “Buy” – George Soros Jumps In

By
Gino Lattarulo
– August 25, 2010
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By Gino Lattarulo

Last week Maxim Group initiated coverage of Sirius / XM (NASDAQ:SIRI) with a “buy” rating and a 1.40 price target. It appears that most analysts share Maxim’s upbeat opinion — Reporting site Zacks shows four “strong buys,” two “holds” and zero “sells”. Hedge Fund mogul George Soros got in on the action as well by purchasing 29 million convertible notes ( valued at 28 million). With 5.6% of SIRI’s float being short interest I think that some squeezing will begin to take effect in the near future as the bearish trades begin to unwind.

For Sirius, the real confidence comes not only from its debt issue being resolved by Liberty Media, but from increased subscriber sales fueled by the ever important auto sector which is once again experiencing growth. Ford (NYSE:F) , Toyota (NYSE:TM), Honda (NYSE:HMC), and the newly minted GM have all reported solid quarterly numbers with encouraging forward guidance.

The satellite radio subscriber base at the end of the second quarter was 19.5 million which is an increase of 6% over 2009.  Sirius expects to add another 1.1 million subscribers by the end of  2010, has generated higher average revenue per user,  and lowered costs to help fuel net profit.  Subscribers paid  $11.81 per month (11 % from the same quarter in 2009) due to demand for the “Best Of” programming. These strong results also show that the negative impact from free services may not be as high as expected as the company reiterated its annual estimates of $2.8 billion in revenue. It was the third straight quarter that  Sirius reported better than expected results.

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