1. Profile
XM Satellite Radio Holdings Inc (XMSR). The Group's principal activity is to design and develop the XM Radio System, which was formed for the purpose of operating a digital audio radio service (DARS). The Group provides audio entertainment and information programming for reception by vehicle, home and portable radios through its high-power satellites Rock and Roll. These satellites offer 100 channels which cover music, news, talk, sports and children's programs with clear sound and coast-to-coast coverage. XM Radios are available under the brand names Sony, Pioneer and Alpine. The Group also provides music formats and delivers a wide range of ethnic and informational programming. The Group owns two FCC licenses to provide a satellite digital radio service in the United States. Radio services are transmitted through the commercial satellites.
2. Technical Analysis
2.1. Long Term Chart
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12733;image)
2.2. Medium Term Chart
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12734;image)
XMSR broke its ascending trendline on the downside. The trend is bearish now.
2.3. Short Term Chart
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12735;image)
I believe the $27.09 support will soon be gone and turned into a resistance level. We have three descending trendlines to put a cap on any advance. I would like to place my position on TL3, which today stands at $28.66 (a 5% rise from last close levels).
3. Fundamental Analysis
3.1. Outstanding Shares
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12736;image)
This company sold shares in a massive way since its IPO. It won't survive if investors are not willing, or not able, to buy additional shares. In fact, the company now is worth 32 times more than in its IPO back in 1999, although the all history chart does not show it and although it lost $2.5 billion during that period.
3.2. Current Ratio
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12737;image)
XMSR's current ratio has been deteriorating and it is now at a very dangerous level of just 1.15. If the company does not turn profitable fast or if the it isn't able to sell any more shares or bonds to finance operations it will face a liquidity crisis.
3.3. Revenues
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12738;image)
There is very strong revenue growth. But, the company is still unable to generate a profit and when it does (if it does), with so many shares it sold, it will probably be a small profit per share.
They sell their service at a loss and unless the company can change that it will cease operations in the future.
3.4. EPS
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12739;image)
Although it looks like the company is reducing its losses, if you consider net loss it is losing more and more money and very far from profitability. This happens because if the number of outstanding shares increases the loss per share is diminished, even though the net loss is indeed rising.
3.6. Competitors
(http://www.3stocksonfire.org/trading/index.php?action=dlattach;attach=12741;image)
4. General Overview
The public loves XMSR, I don't.
There are two risks to XMSR:
1) If a bear market develops, as I'm expecting, the company may face serious liquidity threats.
2) The company may become profitable in the future, and then investors will see how earnings have been diluted. When the company finally makes 2 or 3 cents of profits per share people will feel very disappointed.
5. Trading Plan
I will sell XMSR short around today's open (probably it will be a higher open) for the 3 Stocks on Fire Portfolio. Then I'll update this analysis everyday until I buy to cover.
This will no doubt make Sat Radio newsworthy today. SIRI have Stern and he and the CEO do the opening bell thing today.
http://www.marketwire.com/mw/release_html_b1?release_id=105018
Quote from: AussieTrader on January 03, 2006, 08:13:15 AM
This will no doubt make Sat Radio newsworthy today. SIRI have Stern and he and the CEO do the opening bell thing today.
http://www.marketwire.com/mw/release_html_b1?release_id=105018
Yes, SIRI will open about 1.5% higher, I hope it rises some more so can short it at higher prices. I still want to see some more things about this $9B company.
Nice to see you Aussie :)
There are severals insider sellings last month too (@ $ 28 / 29) .. :o
What I see XMSR:
SHORT TERM BUY
IMO XMSR will drop.......... eventually.
For right now I still think there is way too much optimism about Satellite Radio's future for the capitulation needed. A lot of people got the hardware for Xmas so they will need to sign up with the service which will spike the revenues for the next quarter.
I also foresee SIRI and XMSR as possible buyout candidates by a media conglomerate looking to enhance content distribution. The smart play for either of these companies would be to offer webcast subscription of their content and also offer download sales of music like Apple.
Again, just my opinion.
Interesting thread as fundamental work is very hard as often a stock does not trade according to its fundamentals for soem time. TA wise if you wish to short then can do so at resistance or a break of support. For a long play then then buying support or a break out. In either case s tight stop will make the trade low risk
(http://xs62.xs.to/pics/06012/xmsr0301.jpg)
I just bought and subscribed to Sirius, because they have the best sat radio hardware on the market- S50. This player is fantastic. It records up to 50 hours of music like a television DVR by the way it recognizes your favorite stations. You can load MP3's on the S50 and cary it around like an ipod. It is very slick. Just became available in November. It seems XM would lose business to Sirius just based on this difference in hardware.
I made $1,025 today buy-low sell-high on XMSR.
In $26.9, out $28.30 (5% gain in one day).
See my portfolio in "member corners" thread.
SIRI is also quite attractive at this price level.
May enter SIRI position later. Both oversold.
I have one of these radios. It came with my 2005 Acura MDX. You get a 3 month trial after which you can restart the trial if you call them. I think the programming is just mediocre and seems to repeat itself every couple of hours all throught the day. Also, even though the signal is carried via. satellite you will lose reception everytime you go under an overpass or enter a garage. If you sign up for a multi year subscription the monthly fee can be as low as $8. I don't know how a hand held unit will do due to the reception problem which is about the level of a cell phone.
Thanks for your insights :D
Let me address them one by one:
Quote from: Gu$tavo on January 03, 2006, 10:26:14 AM
There are severals insider sellings last month too (@ $ 28 / 29) .. :o
Thanks for the info Gu$tavo, we have the company selling shares, insiders selling shares, people with real knowledge of the company are selling.
Quote from: shawFund on January 03, 2006, 01:15:38 PM
What I see XMSR:
SHORT TERM BUY
Thanks for your view on XMSR shawFund :)
Quote from: KCScott on January 03, 2006, 01:39:58 PM
IMO XMSR will drop.......... eventually.
For right now I still think there is way too much optimism about Satellite Radio's future for the capitulation needed. A lot of people got the hardware for Xmas so they will need to sign up with the service which will spike the revenues for the next quarter.
I also foresee SIRI and XMSR as possible buyout candidates by a media conglomerate looking to enhance content distribution. The smart play for either of these companies would be to offer webcast subscription of their content and also offer download sales of music like Apple.
Again, just my opinion.
Hello KCScott, you say there's a lot of optimism, and that's precisely when a stock may collapse. A lot of optimism leads to many people that bought the stock (despite of the very poor fundamentals) and now may need to sell if anything negative arises. But the negative news will only be public after a 50% or more correction, not now.
I think XMSR was bearish even before the general market started turning bearish (not much people see this too, I'm not bothered in being alone here), and probably this stock will decline even if the general market doesn't.
I think this company has no viable business plan and will continue losing money. Don't forget the market cap rose 32 times between 1999 and now, it is like the stock is trading at $390, coming from $12. Isn't that enough of hype?
Quote from: metro on January 03, 2006, 03:48:03 PM
Interesting thread as fundamental work is very hard as often a stock does not trade according to its fundamentals for soem time. TA wise if you wish to short then can do so at resistance or a break of support. For a long play then then buying support or a break out. In either case s tight stop will make the trade low risk
(http://xs62.xs.to/pics/06012/xmsr0301.jpg)
I agree with you metro, fundamental analysis is very hard work, but I think it will pay over the long run, as one can hold positions longer for larger profits when he is right. If we can aplly sound money management rules to that I think we have a recipe for above average returns over the long run.
Can you really watch a stock go up several bags only based on technical analysis? I find it a bit hard, since there are always so many false technical signals.
Just want to say that I love your posts, even though sometimes we don't agree, as it were to be expected :)
Quote from: SmartWrasse on January 03, 2006, 06:02:02 PM
I just bought and subscribed to Sirius, because they have the best sat radio hardware on the market- S50. This player is fantastic. It records up to 50 hours of music like a television DVR by the way it recognizes your favorite stations. You can load MP3's on the S50 and cary it around like an ipod. It is very slick. Just became available in November. It seems XM would lose business to Sirius just based on this difference in hardware.
Thanks for this info SmartWrasse, I still have to take a closer look on SIRI.
Quote from: shawFund on January 03, 2006, 06:32:18 PM
I made $1,025 today buy-low sell-high on XMSR.
In $26.9, out $28.30 (5% gain in one day).
See my portfolio in "member corners" thread.
SIRI is also quite attractive at this price level.
May enter SIRI position later. Both oversold.
I don't think buying oversold conditions for 5% profits is a good strategy (because you can lose big going against the trend), but I respect it shawFund. You now have a public portfolio shawFund? I'll take a look at your thread, for sure I'll learn, thank you, nice work :)
Quote from: netfishmademerich on January 04, 2006, 09:14:01 PM
I have one of these radios. It came with my 2005 Acura MDX. You get a 3 month trial after which you can restart the trial if you call them. I think the programming is just mediocre and seems to repeat itself every couple of hours all throught the day. Also, even though the signal is carried via. satellite you will lose reception everytime you go under an overpass or enter a garage. If you sign up for a multi year subscription the monthly fee can be as low as $8. I don't know how a hand held unit will do due to the reception problem which is about the level of a cell phone.
Thanks for your insight netfishmademerich :)
What I think is, even if these companies eventually make a profit, after so much dilution the profit per share will be so small that stocks will tank anyway. And there's the real threat (at least to XMSR) that the company won't survive to see profits, because of a liquidity trap that is building on its balance sheet.
After responding and commenting on your posts, all I have to say is that I will continue holding my XMSR short position.
Yesterday was the 5th day XMSR touched support at $27.09. Apparently investors didn't like the news coming out of the company, even though I can read extreme hype there:
Samsung Introduces the First Complete Line of Portable XM Satellite Radios With MP3 Capability (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7B6B982FC9%2D9AC2%2D4217%2D9E9A%2D0F87D6B5BBE3%7D&symb=)
XM Passport: The First 'Mini' XM Tuner Offers XM Technology in a Tiny, Portable Cartridge (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7BDFD9CE79%2D033D%2D4894%2D9D30%2D09950E280BE1%7D&symb=)
XM and AGT Introduce the Sportscaster Satellite Radio With Special Features for Sports Fans and Sleek Two-Line Display Screen (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7B4FF6DA33%2DC45D%2D4319%2D8ED1%2DADBEF634E48C%7D&symb=)
Pioneer and XM Satellite Radio Achieve Major Milestone in Portable Audio with Pioneer Inno(TM), the Next-Generation XM2go Player with Live XM and MP3 (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7B9A7C00DA%2D072D%2D4FFE%2D8931%2D8DB2EE48ED71%7D&symb=)
XM Satellite Radio Tops Six Million Subscribers (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7BDDEA3B7A%2D27A4%2D4963%2DAC25%2D3A879D423290%7D&symb=)
Audiovox and XM Satellite Radio Introduce XM Passport: The First 'Mini' XM Tuner Offers XM Technology In A Tiny, Portable Cartridge (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7BC2E1226B%2D3404%2D4A60%2D93E6%2D6E01A3A17AE3%7D&symb=)
Audiovox and XM Satellite Radio Unveil the Audiovox XM Xpress Radio (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7BE8156A2F%2DE7B1%2D4958%2D9B4B%2DFDEBA232B336%7D&symb=)
These were all last 2 days press releases :o I call this an haemorrhage of news, and it looks XMSR is desperate for investor's money.
If XMSR breaks $27.09 as I have little doubts it will, I can imagine the stock quickly collapsing to $20 a share.
I'll continue holding XMSR SHORT position.
update???
XMSR makd a big move up today and it is a fact now that the short term trend is UP not DOWN.
Of course, after it touched $30, it may go down. $27 is its year low. The whole year this stock is within $26-$37 range.
If we buy low and sell today, we could have made 15% profit.
Deutsche Securities upgraded XM shares to "Buy" from "Hold," and raised his price target to $33 from $30.
http://finance.yahoo.com/q/ud?s=XMSR.
Never against the market. Follow the trend. Shorting in bull market is suiside.
AOB, SVA, NVAX, TIII, TRAD, LEXR, RMBS, FORD, ... are all back and running up.
Quote from: 422fwhp on January 09, 2006, 09:32:18 AM
update???
Didn't you receive the newsletter 422fwhp? Anyway, sorry for the lack of update, due to technical problems on the website that kept me awake all night long and so many stocks to buy, I didn't have time to update this stock. But on the newsletter it clearly said «HOLD SHORT».
Quote from: shawFund on January 09, 2006, 10:19:18 AM
XMSR makd a big move up today and it is a fact now that the short term trend is UP not DOWN.
Of course, after it touched $30, it may go down. $27 is its year low. The whole year this stock is within $26-$37 range.
If we buy low and sell today, we could have made 15% profit.
Of course, after the fact it is always cash in the pocket. One can never miss.
Quote from: Jimbo on January 09, 2006, 02:00:09 PM
Deutsche Securities upgraded XM shares to "Buy" from "Hold," and raised his price target to $33 from $30.
http://finance.yahoo.com/q/ud?s=XMSR.
Deutsche Securities did a favor to XMSR, a company that may very well face bankruptcy in the future. The company sells more and more but it loses more and more money and goes deeper and deeper into debt and it is almost getting out of working capital. Quite like GM or F, for example, almost no working capital. That is why GM and F trade at a tiny fraction of its revenues ... yet, XMSR trades at 13 times revenues.
Anyway, because the stock wasn't able to break $27 on the downside, and because of this upgrade, bears had to run for the exit. I'm still on the bear camp, but of course losing confidence, since it doesn't pay to be brave in the stock market.
The stock opened a gap at the open between $28.05 and $28.80. I expect it to at least come down to close the gap, now that most shorts covered and the price target at $33 isn't much incentive to buy at $30. I'll use TL4 as protection, if the stock is set to close above $30.04 I'll be forced, by money management rules, to buy to cover this position.
I did short some stocks in 2001 or so, but I don't remember it to be so boring. You can only make 100% of profit on the short side, and I should be looking for stocks with more potential than that.
Also, the risk is unlimited, if you don't cut your losses short. Anyway, I'll hold XMSR short a little longer, it may be a good protection if the general market falls this will tank for sure.
Growth at the company is already slowing and it still loses money and dilutes potential EPS:
«XM Satellite Radio, the nation's leading satellite radio company, today announced that it has more than six million subscribers, and projected it will end 2006 with more than nine million subscribers on the strength of breakthrough products introduced today at the Consumer Electronics Show, its powerful content lineup and growth in the factory-installed new car market. XM extended its lead over its competitor in 2005 by adding 2.7 million net new subscribers, and expects more than three million net new subscribers in 2006.»
Growth in the number of subscribers is expected, by the company, to slow from 100% a year to 50% a year in 2006. What to expect beyond that?
Even if the company ever turns profitable, earnings per share will be extremely small.
Anyway, I don't feel excited about shorting at all, I will buy to cover XMSR if the stock is set to close above TL4, tomorrow at $29.96.
SIRI tanked 6% today, perhaps the market is starting to see that these two companies are bound to fail, unfortunately :-\ There's not enough working capital and both companies did sold all the shares they could on the hype.
XMSR fell back by the close, but still managed to close positive, after cleaning many nervous shorts. I'm not nervous, but I have money management rules and I don't like to lose much on a single trade (nobody likes it, but I control risk by setting a stop loss on close).
I'll continue with my plan of holding XMSR short for as long as the stock doesn't close above TL4, which for tomorrow stands at $29.90.
Quote from: David Randolph on January 11, 2006, 04:28:46 PM
SIRI tanked 6% today, perhaps the market is starting to see that these two companies are bound to fail, unfortunately :-\ There's not enough working capital and both companies did sold all the shares they could on the hype.
I think SIRI fell today beacuse investors just learned 34 million
additional shares can now be dumped into the market:
AP
Stern Can Now Sell $200M Sirius Shares
Wednesday January 11, 4:24 pm ET
By Seth Sutel, AP Business Writer
Shock Jock Howard Stern Can Now Sell $200 Million in Sirius Stock
NEW YORK (AP) -- Just three days after starting his new job at Sirius Satellite Radio Inc., shock jock Howard Stern is now able to sell the roughly $200 million in Sirius stock that he received as part of his five-year deal with the company.
Sirius' contract with Stern runs through 2010, but the company disclosed last week that it was giving Stern and his agent 34.4 million shares of stock right away because it had already reached certain undisclosed targets for subscriber growth under the deal it signed with Stern in late 2004.
On Wednesday, the company made another regulatory filing saying that entities controlled by Stern and his agent, Don Buchwald, would receive the proceeds of the sale of the shares, which could occur at any time. It's not yet clear when or how much they will sell, and Buchwald did not return a call seeking comment.
Nearly all of the stock is going to Stern, but Buchwald also received a substantial chunk: 3.125 million shares, worth nearly $20 million at current share prices, or 10 percent of the 31.25 million shares that Stern received, which are now worth just under $200 million.
Sirius originally said its deal with the shock jock was worth about $100 million per year in cash and stock over the five years of the contract, or $500 million, including costs for producing and marketing the show
But thanks to the nearly doubling of Sirius' shares since then, the value of the stock portion of the contract went from about $110 million to more than $200 million, making the total deal now worth more than $600 million at current stock prices.
Stern could also stand to get even more stock grants as well as a portion of the revenues from advertising on Stern's show if other, "substantial" targets for subscriber gains are met, according to Sirius spokesman Jim Collins. Collins declined to say how large those grants might be or what targets needed to be met in order to trigger the additional payments.
Stern began his broadcasts from Sirius' Manhattan studios on Monday after a long career at Infinity Broadcasting, which is now known as CBS Radio and is a part of CBS Corp.
Unlike traditional radio broadcasts, satellite radio is free from federal decency rules, something Stern long railed against on his show. Stern, a hugely popular radio personality, has promised his fans on Sirius a stripper pole, live sex and other programming that would be likely to raise the ire of federal regulators.
Sirius is engaged in a high-stakes battle with its rival XM Satellite Radio Holdings Inc. to build up programming and subscribers in hopes of becoming profitable one day. Sirius said in its regulatory filing Wednesday that as of last Sept. 30 it had racked up an accumulated loss of $2.4 billion so far.
While neither company is profitable, both have also been quickly adding subscribers, who pay about $13 a month for either service. Sirius ended 2005 with some 3.3 million subscribers, compared with 1.1 million a year earlier and well ahead of its earlier forecasts. XM says it now has more than 6 million subscribers.
Sirius shares fell 38 cents, or 5.8 percent, to close at $6.12 on the Nasdaq Stock Market Wednesday, while XM shares fell 6 cents to close at $29.52 on Nasdaq
Hi Folks,
#1, We're in a bull market!
#2, Shorting anything now is dangerous ( reversals can be swift )
#3, Friday, the Dow stocks should begin really moving up to achieve about 11,500 by January's end. Dow's ( after some subsequent choppiness ) heading for 13,000
I'd suggest spending efforts on long plays that'll make you rich!
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
my thoughts,
willey
XMSR is coming down after touching TL4 with the help of a Deutsche Securities upgrade. I'm still on the bear camp on this one and I think it will ultimately break $27 on the downside, after the current distribution phase.
I'll continue holding XMSR SHORT, unless it is set to close above TL4, today at $29.85.
XMSR continues to play around with common stock investor's money:
XM Satellite Radio Holdings Announces Quarterly Dividend on Series B Preferred Stock (http://www.marketwatch.com/tools/quotes/newsarticle.asp?dist=¶m=archive&siteid=mktw&guid=%7B6EA4513A%2D65CB%2D40A4%2DB49A%2DC380EA9309F8%7D)
Since the company is running out of cash, now it will pay dividends to its Series B Preferred Stock holders in common stock, common stock that will probably be sold on the open market, further depressing the stock price.
«The dividend is payable in shares of the Company's Class A Common Stock at a rate of $1.0313 per share of Series B Preferred Stock owned, with fractional shares to be paid in cash. The shares of Class A Common Stock to be issued will be valued at 95% of the average daily price of the Class A Common Stock for the 10 consecutive trading days ending on January 12, 2006. The dividend is payable as of February 1, 2006, to Series B convertible preferred stockholders of record of XM Satellite Radio Holdings Inc. as of January 20, 2006.»
This will probably make XMSR stock to sink, I hope so, since I'm short the stock, I believe for a good reason.
I'll continue with my plan of holding XMSR SHORT, unless it is set to close above TL4, today at $29.79.
Reading XMSR's Yahoo! board, beside a few laughs, gave me the notion that I'm not alone on this XMSR short position.
Today this short position helped the Stocks on Fire Portfolio to rise 0.92%, on a day that the S&P500 declined 0.36%. A few shorts makes the portfolio balanced and protects it against the general market risk.
I welcome a few short positions to the Stocks on Fire Portfolio, say 3 stocks (I wish I still had REDF short, big sell off today, I was right, but I let the pressure build and made a bad decision).
I'll continue with my plan of holding the stock short for as long as it is set to close below TL4. For tomorrow that trendline stands at $29.79.
Quote from: David Randolph on January 17, 2006, 05:09:02 PM
Today this short position helped the Stocks on Fire Portfolio to rise 0.92%, on a day that the S&P500 declined 0.36%. A few shorts makes the portfolio balanced and protects it against the general market risk.
I agree,,, so I'm always short in 2 or 3 stocks.
Quote from: David Randolph on January 17, 2006, 05:09:02 PM
I welcome a few short positions to the Stocks on Fire Portfolio, say 3 stocks (I wish I still had REDF short, big sell off today, I was right, but I let the pressure build and made a bad decision).
You did right at that time with REDF... I had to cover too with an small lost(-2%) and today I'm short again but with + 6% ... so... where is the problem ?
Shorted today. My first bearish trade since I bought Puts on XMSR 2-years ago (January 2004). I bought the puts when the stock experienced a high volume top (20 million shares) at $29. Within 2 weeks it was at $22. My puts gave made an easy 275%.
I believe the time is right for XMSR to tank. David's chart clearly shows lower highs and lower lows, with high-volume on each successive price spike. Also, NASDAQ and global markets are turning bearish. A 50 pt decline in NASDAQ should not be ignored.
The only way XMSR survives from quarter to quarter is to issue more shares. The news on Jan. 13 should be a red flag to any longs. Preferred shareholders to recieve a common stock distribution. Further dilution means oversupply. :'(
Quote from: poorman1 on January 20, 2006, 05:07:53 PM
Shorted today. My first bearish trade since I bought Puts on XMSR 2-years ago (January 2004). I bought the puts when the stock experienced a high volume top (20 million shares) at $29. Within 2 weeks it was at $22. My puts gave made an easy 275%.
I believe the time is right for XMSR to tank. David's chart clearly shows lower highs and lower lows, with high-volume on each successive price spike. Also, NASDAQ and global markets are turning bearish. A 50 pt decline in NASDAQ should not be ignored.
The only way XMSR survives from quarter to quarter is to issue more shares. The news on Jan. 13 should be a red flag to any longs. Preferred shareholders to receive a common stock distribution. Further dilution means oversupply. :'(
I totally agree with your reasoning poorman1 :)
If XMSR breaks $27 on the downside I think it will fall $5 quite rapidly. I still feel sorry about that REDF short trade, it was such a perfect and legitimate trade ... the stock fell 25% right after I bought to cover, on a slim cut of the resistance level (just 6 cents, if I recall correctly).
Well, I kept the lesson ...
I'll keep on holding XMSR short, already in the green ;)
Before I decide to take a bearish stance on a stock. I like to print the chart and turn it upside down. If the upside down chart looks like a buy, then it should obviously be given a sell recommendation. ;)
Quote from: poorman1 on January 23, 2006, 12:49:13 PM
Before I decide to take a bearish stance on a stock. I like to print the chart and turn it upside down. If the upside down chart looks like a buy, then it should obviously be given a sell recommendation. ;)
That's an excellent idea poorman - let me give our users that perspective on the first chart below. That is a perfect ascending triangle that is on the verge of a bullish breakout. The technical target of the breakout is $32-$27 = $5. $27-$5 =
$22.
I'll continue holding XMSR short, expecting it to break $27 on the downside soon.
What an extraordinary technical development on XMSR: the stock finally broke $27 on the downside, with extremely heavy volume of 18 million shares traded.
I said this company is running out of working capital, didn't I? It needs to keep on selling more and more shares on the open market to finance operations and investments. If it ever becomes profitable, earnings will be so diluted that investors will feel very disappointed.
Yesterday we had news of a conversion to common shares at price $3.18 (http://biz.yahoo.com/e/060130/xmsr8-k.html) :o
The technical target of this breakdown is $22 and I expect to cover my short position around that level.
We had good news on XMSR yesterday before the open: XM NavTraffic Service Continues Rapid Expansion With Addition of Nine New Markets (http://www.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=157373&guid=%7B91FC67D8%2D990D%2D430B%2D85B9%2D035ABE5CC874%7D&symb=)
Yet, the stock went down on the day. Volume was a stagering 24 million shares :o
I don't know what to say from such a strong volume on this technical breakdown, but it can mean two opposite things:
1) Buyers are very attracted by the lower price, yet investors are bailing out because of the technical breakdown
2) We'll have a serious breakdown and liquidity problems at the company will show up.
I don't know which one is going to be, but I'll go with the chart. I'm expecting to close this short position on XMSR at the technical target of the breakdown, $22.
XMSR goes down when the market goes down, it goes down when the market goes up, it goes down with bad news, good news, down with big volume, down with little volume. Down, down and down.
The chart clearly says the trend is bearish and the technical target of the last breakdown is $22.
That's where I'll cover my short position on XMSR.
No news today on XMSR, I'll continue with my plan of closing this short position at $22.
Yesterday's candle suggests there can be some short covering today on XMSR but technically everything points to lower and lower prices on the stock. I believe XMSR won't make any meaningfull upward move before it touches $22 or lower.
I'll continue trying to buy to cover XMSR around $22.
The previous day's candlestick really told yesterday's story. I don't feel like owning short positions at this point. The general market is reacting well to bad news - it seems it has already discounted an economic slowdown.
Also, CSCO's numbers yesterday may mean another rally to new highs in the general market, because out of favor large cap stocks may come into favor, as most of them are cheap, if we take into consideration bond yields and earnings multiples.
Of course, this doesn't mean XMSR won't go down or that it isn't in bad financial shape, it is. But it is always harder for a stock to go down in a bull market than in a bear market.
I'll buy to cover XMSR around today's open, getting my first profit in bear operations. Of course it is my first profit, we're in a bull market !
Might want to cover pre market-
Up over 6% now!!
Quote from: boatguy on February 09, 2006, 08:26:29 AM
Might want to cover pre market-
Up over 6% now!!
Damn it, bad luck :P It's because of something Ophra related :P
Yes, I'll buy to cover in the pre-market after I send the newsletter ... I'd better send it right away.
Looks like XMSR made David's original target of $22 on the downside(LOD $21.65) ;)
I soulda, woulda ............................... :(
Anyways, applaud to David for his TA :)
I just covered this today near the close. I plan on re-shorting it next week.
Profile: XM Satellite Radio Holdings, Inc. operates as a satellite radio service company primarily in the United States. It provides music, news, talk, information, entertainment, and sports programming for reception by vehicle, home, and portable radios, as well as over the Internet to approximately 6 million subscribers.
Website: http://www.xmradio.com
Trading Idea:
XMSR is down trending since last September, its fundamentals are not in good shape, and the stock has been severely punished by investors. We are not buying XMSR for its fundamentals or prospects; this is purely a technical trade for short term purposes.
After reaching 13$ last month after a hard sell off, XMSR manage to hold above this reference making a sort of double bottom pattern... It seems to be ready for a technical rebound, volume increased significantly yesterday with a lot of activity on the intraday chart and a close near the highs of the day.
For the upside, there is a resistance near $15.00, and above it a lot of room for a further rebound. XMSR is trading inside a descending channel, with top near $18.00.
We are going to buy XMSR today at or near the open, and we'll set a stop at $13.20 for this trade.
Best regards,
additional information:
XM, Sirius Rise On Merger Talk
Tuesday , June 27, 2006 00:35 ET
Jun 27, 2006 (financialwire.net via COMTEX) -- June 27, 2006 (FinancialWire) Sirius Satellite Radio (NASDAQ: SIRI) and XM Satellite (NASDAQ: XMSR) both rose after the chief executive of Sirius speculated about combining the two companies.
Mel Karmazin said that he would be interested in buying rival XM, though he considered the possible regulatory filings to be difficult for both companies. Sirius and XM are the only two major satellite radios in the US, making it likely that a merger could be riddled by antitrust concerns.
Shares of XM jumped 6.8% to close at $14.37 on the speculation, while Sirius jumped 5.2% to $4.70 in Monday's trade.
&
XMSR: RBC Capital Keeps @ Outperform; Cuts Tgt to $26 vs $30
Monday , June 19, 2006 09:22 ET
Issuer: XM Satellite Radio Holdings Inc (NasdaqNM: XMSR)
Analyst Firm: RBC Capital Markets
Ratings Action: REITERATION
Current Rating: Outperform
Target Price Action: DECREASE
Target Price: $26.00 (-13.33% from $30.00)
&
XMSR: Short Interest UP 8.9% to 39.3M in Jun 2006
Monday , June 26, 2006 16:23 ET
According to new short interest data from NASDAQ, short interest for XM Satellite Radio Holdings Inc (NasdaqNM: XMSR) INCREASED 8.9% to 39,344,810 shares for the month ended mid-June, 2006.
SYMBOL MAY JUNE CHANGE %CHANGE DAYS/COVER
-------- ------------- ------------- ------------- ------------ ----------
XMSR 36,121,241 39,344,810 +3,223,569 +8.92% 6
Based on XMSR's 20-day average daily share volume of 7,702,615, it would require approximately 6 day(s) of buying to cover this short interest.
cheers
Oliver
An UBS analyst published some positive comments about XMSR:
QuoteUBS analyst Lucas Binder maintained a "Buy" rating and a $25 price target for XM.
Full Article: http://biz.yahoo.com/ap/060628/xm_satellite_radio_mover.html?.v=1
Update:
XMSR had a nice session, recovering almost all of Tuesday's loses. Volume was below average, but that's not an issue for now. $14.50 is the intraday resistance (Monday and yesterday barrier), but $15 is the main reference for a further move up, we expect XMSR to break both barriers soon.
Trading Plan:
Hold XMSR with a stop @ $13.20Regards,
XMSR is approaching its resistance at $15.00; this is the key level for a further move to the upside. With the right market conditions we expect this rebound to reach the upper side of XMSR's descending channel (approximately $18)
Trading Plan:
Hold XMSR with a stop @ $13.20
Regards,
Update:
XMSR is being attracted to the $15 resistance; Monday was another strong close even being a low volume day... All we need now is the breakout of the $15 barrier, and we'll have the coast clear for a nice drive.
Trading Plan:
Hold XMSR with a stop @ $13.20
Regards,
Update:
XMSR was down today because of this:
Sirius subscriber growth outpaces XM (http://biz.yahoo.com/rb/060706/media_xmsatellite.html?.v=6)
Race for subscribers to satellite radio tightens up
From a technical point of view, XMSR approached its short term ascending support, not changing the current rebound pattern we are trading. We'll stand to the same plan for now.
Trading Plan:
Hold XMSR with a stop @ $13.20
Regards,
I think that we do not need to buy both stocks.
It seems to me that SIRI, as a later comer, has been growing faster than XMAS and should be the choice and can be put into long term holdings.
When its price dropped from near $8.00 to less than $4.00, it fits my selection criteria - dropped at least 50% from recent high and has strong financial backup and growth potencial.
At $4.70, it already gained 30% from low, I will skip it.
XM Satellite Radio Holdings "buy"
Friday, July 07, 2006 4:20:54 AM ET
Morgan Joseph & Co
NEW YORK, July 7 (newratings.com) - In a research note published yesterday, analyst David B Kestenbaum of Morgan Joseph maintains his "buy" rating on XM Satellite Radio Holdings Inc (XMSR.NAS). The target price is set to $24.
Update:
XMSR was featured in TSC last Friday, nothing much relevant for this trade, but these levels are for sure attracting some attentions.
From a technical approach, the last down sessions pulled XMSR to near the support level, now we expect XMSR to retest the $15 this week, and we'll keep the same plan for now.
Trading Plan:
Hold XMSR with a stop @ $13.20
Regards,
Unfortunately Motley Fool made this comment yesterday:
The decrease in sales is due to a combination of factors: shipments of a receiver for XM Satellite Radio (Nasdaq: XMSR - News) programming were halted when the device was found not to meet FCC emissions standards, and portable DVD promotions that would cut into selling margins were discontinued. The earnings release repeatedly mentions a focus on margins, and management says that gross margins are expanding. Moreover, upcoming product launches are supposed to boost selling margins further, as the prices have been set with that strategy in mind. Sacrifice sales, reap margin improvements.
Talk is cheap, though. Yes, Audiovox's gross margins improved from 15.8% last year to 18% this period, but net margins dropped by 65% and operating margins turned negative. That hardly counts as improvement.
and today
Janco Partners downgraded it from buy to market perform.
jorgegr
Update:
Not only the downgrade by Janco Partners but also the big market correction both events pushed XMSR near the support level, and also closer to our stop level. We have no other option than stay with the same plan, our current stop is a bit below the support line, and if XMSR goes there, the reasons we had to be in this position will vanish. Hopefully the support level will bring some buying pressure to this stock.
Trading Plan:
Hold XMSR with a stop @ $13.20
Regards,
The "XMSR" Threads in Previous 3SOF Picks
Have been merged.
Got the go ahead to do so from Ramsburg.
I will be working here on this board to merge other threads also.
I will leave you Friday's closing chart while I'm in this thread.......
Good trading to all !
Regards,
Your fellow trader @3SOF
setravis
Press Release Source: XM Satellite Radio
GM Expands XM As Standard on All 2008 Buick, HUMMER and Saab Models
Thursday October 18, 9:00 am ET
XM Also Standard on Many of GM's Most Popular Saturn, Chevrolet, Pontiac and GMC Vehicles
WASHINGTON, Oct. 18 /PRNewswire-FirstCall/ -- XM Satellite Radio (Nasdaq: XMSR - News), the nation's leading provider of satellite radio, today announced that XM Radio is a standard feature for the first time on all General Motors 2008 model year Buick, HUMMER and Saab vehicles.
(Logo: http://www.newscom.com/cgi-bin/prnh/20070313/XMLOGO )
XM is also now widely standard across many of the most popular vehicles in the Saturn, Chevrolet, GMC and Pontiac lineups, including: the all-new 2008 Chevrolet Malibu, Silverado, Tahoe, Cobalt, Corvette and Impala; Saturn VUE, OUTLOOK, AURA and SKY; GMC Acadia, Yukon, and Sierra; and Pontiac G5 and Solstice models among others.
Cadillac was the first automotive brand to offer XM as a standard feature. In total, XM is available today on more than 50 model year 2008 GM vehicles sold through thousands of GM dealerships nationwide.
GM was the world's first automaker to offer satellite radio as a factory-installed feature when it introduced XM on Cadillac models in 2001. GM has produced more than six million vehicles with XM.
"XM looks forward to offering our unmatched music, sports and talk programming to all Buick, HUMMER and Saab buyers," said Steve Cook, executive vice president, Automotive, XM Satellite Radio. "This expansion will continue XM's outstanding growth in the new car market, that will provide us with sustained subscriber growth for 2008 and beyond."
"XM Satellite Radio has been one of the most successful entertainment offerings ever launched by General Motors," said Rick Lee, General Motors executive director. "The XM service has broad appeal, with a growing number of our customers asking for the service in their new car or truck. In the 2008 model year, General Motors will build more than 2.5 million vehicles with XM."
Every new General Motors vehicle with factory-installed XM comes standard with a complimentary three month trial subscription. An XM Radio trial program is also available to GM Certified Used Vehicles, Cadillac Certified Pre-Owned Vehicles, and HUMMER Certified Pre-Owned Vehicles, making the program available to buyers of both new and certified used models equipped with XM.
For more information on XM in GM vehicles, visit http://www.xmradio.com/whatisxm/inyourvehicle/ .
About XM
XM (Nasdaq: XMSR - News) is America's number one satellite radio company with more than 8.2 million subscribers. Broadcasting live daily from studios in Washington, DC, New York City, Chicago, the Country Music Hall of Fame in Nashville, Toronto and Montreal, XM's 2007 lineup includes more than 170 digital channels of choice from coast to coast: commercial-free music, premier sports, news, talk radio, comedy, children's and entertainment programming; and the most advanced traffic and weather information.
XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Hyundai, Nissan, Ferrari, Porsche, Subaru, Suzuki and Toyota, is available in more than 140 different vehicle models for 2007. XM's industry-leading products are available at consumer electronics retailers nationwide. For more information about XM hardware, programming and partnerships, please visit http://www.xmradio.com.
Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions, future events or performance with respect to XM Satellite Radio Holdings Inc. ("XM") are not historical facts and may be forward-looking and, accordingly, such statements involve estimates, assumptions and uncertainties which could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, any such statements are qualified in their entirety by reference to the factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2006 filed with the Securities and Exchange Commission. Among the significant factors that could cause our actual results to differ materially from those expressed are: our pending merger with SIRIUS Satellite Radio Inc. ("SIRIUS"), including related uncertainties and risks and the impact on our business if the merger is not completed; any events which affect the useful life of our satellites; our dependence upon third parties, including manufacturers of XM radios, retailers, automakers and programming providers; and our competitive position versus other audio entertainment providers.
Factors that could cause actual results to differ materially from those in the forward-looking statements in this press release include demand for XM Satellite Radio's service, the Company's dependence on technology and third party vendors, its potential need for additional financing, as well as other risks described in XM Satellite Radio Holdings Inc.'s Form 10-K filed with the Securities and Exchange Commission on 3-1-07. Copies of the filing are available upon request from XM Radio's Investor Relations Department. Programming schedules subject to change.
--------------------------------------------------------------------------------
Source: XM Satellite Radio
AP
Market Spotlight: Satellite Radio
Friday October 19, 2:15 pm ET
By Jeremy Herron, AP Business Writer
Sirius, XM Shares Likely to Bounce Around Ahead of Deal Decision, 3rd-Quarter Results
NEW YORK (AP) -- Investors in satellite radio are accustomed to wild fluctuations, but the next few weeks promise to deliver even sharper movements, as regulators decide whether Sirius Satellite Radio Inc. can buy XM Satellite Radio Holdings Inc.
The companies will also report third-quarter results, putting the viability of their operations back in focus, at least temporarily. That comes at a time when recent data show retail sales of satellite radios slowing sharply.
Analysts are mixed on the implications of that development. In the short-term, it likely means lower subscriber numbers than the companies have forecast, but Stifel analyst Kit Spring thinks the increasing availability of the radios in new cars is probably making retail channels less important.
"It is our thesis that satellite radio will be successful because of high penetration into vehicles," he wrote in a note to investors last month. Recently, Chrysler said it would install Sirius radios in 70 percent of its 2008 models, for example. All major car makers have a deal with one of the two satellite radio operators.
XM finished the second quarter with 8.25 million subscribers, while Sirius had just over 7 million, but Sirius has been growing at a faster pace for seven straight quarters.
The terms of the deal stipulate Sirius will pay 4.6 shares for each XM share, which provided a 22 percent premium when the deal was announced. Based on the stocks' closing prices Wednesday, Sirius is offering a premium of 8 percent.
Analysts say a combination would make financial sense and could save an enormous amount of operating costs, but any estimates must be considered very speculative. There remain many questions related to equipment, one problem being that Sirius radios currently cannot tune XM signals and vice versa.
Beyond that, the deal faces high regulatory hurdles, not least because of a Federal Communications Commission provision that specifically forbids the two companies to combine. The FCC does have the authority to waive that stipulation. Along with the FCC, the Department of Justice has to review the deal on antitrust grounds.
In September, XM and Sirius announced they had provided all information requested by the Justice Department. That led to widespread speculation that the DOJ would approve the deal, although the regulator gave no indications that would lead to that conclusion.
Still, numerous analysts have said the deal has a better than 50 percent chance of going through.
"We expect DOJ approval and a split FCC decision in favor," Cowen analyst Tom Watts said recently. He expects a ruling in the next three to six weeks from the Justice Department. In any event, he said, the stocks are good bets because, either together or apart, Sirius and XM will post subscriber and revenue gains.
Updated view.......
New Supporters of SIRIUS/XM Merger Urge FCC Approval...
52wk Range: 9.91 - 17.70
Volume: 4,744,945
Avg Vol (3m): 4,950,060
Market Cap: 4.61B
Technicals
Close Below the 13-day MA
Last Price Quote is:
-0.16%below 13-day MA
8.61%above 50-day MA
RS Rating: 92
Fundamentals
Earnings Expected on Oct 25
Key Data:
Market Cap (M): $4,605.23
P/E Ratio: NA
PEG Ratio: -0.546099
Next Earnings: 10/25/2007
Last Analyst Rating: Sell
Friday's closing chart.......