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.
On the flip side, I discovered another investment idea within the last week. It too is what I consider to be w/i my circle of competence. So, yesterday, I started accumulating a stock for an earnings play next week. I have not finished purchasing all that I want yet, but I will post the trades next week. This is a stock that no one likes, earnings have been erratic, and the long term chart looks like crap. However, I have been paying attention or becoming more aware, on an indirect basis of something very closely related to this stock. Bottom line: I am getting in b/c there are real catalysts that, imo, have emerged during this past Q. Without even thinking about the stock itself, I almost made a big purchase involving it and I did make an indirect purchase. There is also a rather loud, albeit indirect buzz that I am hoping has had a synergistic impact. The short term chart looks pretty good, although I could understand that some would say the good news may be priced in b/c the stock has run up from its recent lows. However, my thought process is that if this stock d/n benefit from these catalysts this Q, it ain't never gonna benefit.
If this doesn't work out, I am making note of this b/c I truly d/n believe that this is pure speculation. This stock is in the internet field and I am familiar enuf with the industry. With Yahoo! reporting something like a 50% ad increase for the 'net, this should also lends support to taking this speculative position. This definitely could blow up b/c mgt has disappointed in the past, but I gotta feeling that they are gonna post record numbers. Stay tuned. |
