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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Madharry who wrote (27673)	8/8/2007 7:30:49 PM
From: E_K_S	Respond to of 78751

Hi Madharry - I can not figure out WON but have not totally given up either. I originally liked the company because of their ability to generate free flow cash flow but this is down due to the industry downturn in advertizing revenues. Perhaps the overall business model has flipped upside down with a lot of the new revenues migrating to the Internet. WON does not have any significant "hard assets" but the value is (or was) in their franchise. Over the time period I have owned it several positive events have occurred (1) a new non-exclusive contract with CBS, (2) new management team and (3) the board evaluating the sale of the company. I have an average cost of $7.00 and today averaged down with shares so my new cost is around $5.00. I believe eventually the company will be sold and integrated with a larger organization that needs their syndication franchise. The company is still working on developing new sources of ad revenue other than radio but this is a work in progress. The real value and money generator is their radio syndication business. This has been much slower to turn around than I expected. I guess I am a bit less bullish than I was 24 months ago but am more positive that some resolution will happen sooner than later. My exit strategy is to establish my new positions today , hear management's discussion and progress on their business on tomorrow's earnings report, see if the board and their investment banker found any interested buyer(s) and if no new developments, I will probably slowly exit my positions with a small loss. Luckily, I have significant gains in a few shipping stocks (DRYs & SFL) which I plan to peel more shares from that will cover any loss I have in WON. WON is a difficult value play as they did not have any undervalued "hard" assets like real estate but a very profitable franchise that I paid $0.50 on the dollar for but unfortunately it is now worth $0.20 on the dollar. Poof, their goodwill and value as a franchise (and ability to generate all that free flow cash flow) dissapeared. EKS P.S. I would only recommend a speculative buy at this time and there are probably better value plays in the media industry than WON. I have been wrong in the past and will be wrong in the future. The key is to try to be right more often than wrong.