TSCM Follow-up courtesy of internetstockblog.com
Friday, July 29, 2005
TheStreet.com discusses the "Mad Money Cramer Effect" (TSCM 2Q05 conf call quotes)
TheStreet.com (ticker: TSCM) CEO Tom Clarke was asked whether his company has benefitted from the popularity of Jim Cramer's TV show, Mad Money. Excerpts from his answer:
… Jim has had tremendous success with the show… and we are starting to see a benefit… There is no tie economically. But what happens is… we are starting to see people that want to find out what Jim is writing about… what he is talking about, what's owned in his charitable trusts… So we are seeing a tremendous amount of interest coming from that... People are… inquiring about how to access more of the content that Jim writes about, which is on Real Money. So we had a very strong June in subscriptions and… if you look at our orders that were booked, we are seeing the same trend in July… as the show grows in popularity and our relationship with CNBC continues to be worked on I think there is a great opportunity for us. And again, it is marketing lead generation for us with no cost on our side.
… I can't quantify the number, but our gut feeling is the show is a successful funnel of not only people who become readers of our free site of which is an advertising supported vehicle, but also then they move on to a subscription product
Trade Alerts:
As previously reported, this week I continued to make purchases of the internet co., which was Jim Craamer's company. My purchases have been in the approx. range of $3.50 -$3.70. They reported earnings this morning. Here is my full analysis for the buy, which I only shared with a few before today.
Recently, it hit me that Cramer's popularity has never been higher. His Mad Money TV show only started in late March. His book only recently came out. I have thoroughly researched the Nielsen ratings and his TV show appears to be consistently growing in viewership. There can be no doubt that he moves some (but not all) stocks. And no doubt that he has his share of losers. Indeed, a couple of studies have been done that opine that his picks are only 50-50. However, those studies factor in *all* his picks, not just those that he has the most conviction. Anyway, I took a look at TSCM. The stock has been a posterboard for the dog of the dogs, the dreg of the dreg, the pos of the pos. I haven't found anyone with anything good to say about it. My due diligence reveals, however, that in January of this year, the company, for all intents and purposes, put itself up for sale. On January 12th, 2005, the company basically announced that they would explore "strategic alternatives," including the sale of the company to private investors. On June 28th, 2005, they shut down their internal research team, IRG group. In short, I believe that TSCM must have reaped synergistic benefits (increased traffic) to the sitefrom Mad Money and the book sales in Q2, but maybe even more in Q3 as his show continues to pick up steam. In that regard, I would expect guidance to be better for 2nd half of 2005. Since they had already decided to sell the firm, i.e., they are on the block as a takeover target, I see the Mad Money synergy as an added value catalyst for the stock. Thus, if you combine the foregoing with the recent bullishness in the stock mkt and the increased M&A activity on the Street, and while I have not done any DD in terms of what this might be worth as a pure TO target, I am thinking that this stock should move towards $5 or more before EOY if only because of the increased traffic to the site. |
