3SOF

Quote from: soxguy on November 06, 2007, 11:04:30 AM
I hope those selling this morning are just nervous rather than knowlegible.

I don't think they're nervous, they're pretty happy about selling GIGM for a profit, because most people lose their sleep when holding unrealized big fat profits. They feel like they want the cash in the pocket, losing sight of why they invested in the first place.

There's a good excerpt on Reminiscences of a Stock Operator about this common attitude. I'm sure most of you already know it, but if someone shows interest, I'll go get it and copy/paste it to this thread.

GIGM's business model is totally independent from the economic cycle. The level of global economic growth, inflation, interest rates, oil price or any other macroeconomic variable doesn't change GIGM's growth prospects, which are spectacular in my view.

GIGM is an undervalued growth stock which will, without a doubt in my mind, be worth more than $2 B ($38 a share) over the next 12 months.

Quote from: la-onda on November 06, 2007, 07:01:46 PM
GigaMedia (GIGM) NewsBite - GigaMedia Slips on Lionbridge Outlook
Tuesday , November 06, 2007 02:56ET

Nov 06, 2007 (Fresh Brewed Media via COMTEX) -- GigaMedia Ltd. (GIGM) opened at 24.00. So far today, the stock has hit a low of 21.23 and a high of 24.10. GIGM is now trading at 22.08, down 1.79 (-7.46%). The stock hit its 52 week high of 25.42 in November and set its 52 week low of 8.66 in December. GIGM has been moving upwards for most of the past year. Shares of internet software providers have been falling today after Lionbridge Technologies Inc. (LIOX) posted disappointing third-quarter sales and issued revenue outlook below analysts' expectations. Technical indicators for the stock are bullish and steady. If you're looking for a hedged trade on this stock, consider a December bear-call credit spread above the $30 level. GIGM stock could rise up to 35.9% before expiration and this position would still be profitable.

First, GIGM isn't an internet service provider anymore. Those operations are for sale and represented just 9.1% of revenue in Q2 2007. Second, LIOX's business doesn't have anything to do with GIGM's and LIOX is just a $211 M market cap, it hardly impacts any other companies.

Anyway, thanks for bringing us this information la-onda, it's always good to know what others are thinking and why they're doing what they're doing, especially when they're doing wrong things for the wrong reasons while they're against our position. 

I'll keep holding GIGM for the long term.

GIGM looks like a great point to buy or add on it's first trip to the 50MA - $18.48 since August.

Quote from: BigSully1 on November 08, 2007, 12:27:02 PM
GIGM looks like a great point to buy or add on it's first trip to the 50MA - $18.48 since August.

I naturally agree BigSully1. It's interesting the persistence of pullbacks to the 50 days SMA on bullish stocks. I'll keep that in mind the next time I want to buy a new stock ... sooner or later, they'll pullback to the 50's or maybe even the 200 days SMA, and that's the right timing to buy.

Now, it doesn't always happen this way ... look at ASTI for example, if I waited for a touch in the 50's I would still be waiting, not winning 53% as I am now.

GIGM's sell off was a non-sense in my opinion, but this is the way the market works. Even though from a fundamental standpoint it looks obvious that we'll see $50 instead of $10, the market does what it can to shake everybody out of this conviction. It convinces a man that getting in and out is the best attitude. But, when the stock indeed reaches $50 and he looks to his records, he sees that it took him a lot of work to squeeze $15 a share out of the stock, compared to $30 a share for the simple "buy and hold" strategy.

I'll keep holding GIGM for the long term.

GIGM's earnings will be released on Wednesday before the open. I really love the way they show us the numbers, subdivided by business units.

Perhaps at $25 GIGM was overvalued, for a person just considering the current revenues and earnings. But for a person, like myself, who also considers the future potential, GIGM was still undervalued. GIGM will be worth $50 a share, in my view, and I don't see many risks to this prediction.

I'll keep holding GIGM for the long term.

Over the last 2 weeks people got really angry at this stock.What do they know that I don't?

It's amazing how quickly profits are wiped out. And the problem is, it is hard to figure a plan for taking profits when the intent is long-term investment...

Soxguy, what is your strategy?

I guess we would be better off if we checked the price once a month,but that's not realistic. My cost basis is $12.47. I'll sell only to avoid a loss if it get's down that far.

Quote from: soxguy on November 12, 2007, 01:01:50 PM
Over the last 2 weeks people got really angry at this stock.What do they know that I don't?

What did the people selling between $9 and $10 back in August knew about GIGM's fundamentals? They knew nothing ... pretty much like the people selling now.

GIGM came down quite ferociously ... but, the company has nothing to do with the worries currently constant in the market. The US economy? GIGM doesn't conduct any businesses in the US. Moreover its business model and growth don't depend on economic growth, because gambling is relatively immune to the economic cycle ... if anything people gamble more at times of economic anxiety. Credit problems? GIGM doesn't concede any credit, all its costumers pay in cash.

The only reason why GIGM came down is an earnings multiple compression. Next year's earnings multiple came down from 25 to 16. Now the stock is very cheap, because EPS will probably grow by 60% or more in 2008 and the P/E is just 16. This growth estimate doesn't depend on anything, it naturally flows from the company's innovative businesses.

I'll keep holding GIGM for the long term.

nice summarization:

Case in point:  Motley Fool Global Gains recommendation GigaMedia  (Nasdaq: GIGM). Just take a look at this chart and tell me how much sense it makes. Yesterday the stock tanked 13% on ... well, on no news at all. According to efficient market theory, there would need to be something, some bit of data, to explain the market's drastic repricing of the stock. If there was any information out there today -- and I've seen nothing to indicate that there was -- it must have been retracted, or counteracted and then some. Today, the stock has zipped back up 20%. A search for news that might explain this move turns up zilch.

The quick and drastic moves at GigaMedia may be extreme examples, but they're by no means the only ones. There are a ton of great companies out there going on sale because of our jumpy markets. One of the ways I keep tabs on them is by running a screen that looks for beaten-up, solid performers: companies with a history of revenue growth, earnings growth, and most importantly, expanding margins. That means these companies are firing on all cylinders, and getting more profitable as they take in more on the top line. Finally, I look for those that have been smacked down at least 15% from their 52-week highs. These days, this screen yields more than 100 first-class firms.
That's not to say there's no reason at all for stocks to be moving. GigaMedia is a great growth story, but let's be honest, it has had a heck of a run over the past few months. Something as simple as pessimism and profit-taking could quickly snowball into a 15% drop, but today, we see just how "justified" such movements may not be. More often than not these days, the swings are not based on data, nor any material news about a company's long-term prospects. A major proportion of the drops I'm seeing are based on fear and herd mentality, and that's exactly the kind of irrational "efficient market" action that can make you money. But only if you have the guts to buy when things get crazy.

I like the chart and I am looking forward for the Q3 results

The effect of seasonality that many people expected in the 2nd quarter happened now, with GIGM results roughly flat versus the prior quarter:

• GigaMedia Q3: Record Revenues, Up 76% Y-o-Y
PR Newswire (Wed 6:15am)

It still beat expectations:

• InPlay: GigaMedia beats by $0.03, beats on revs
Briefing.com (Wed 6:21am)

But I guess the market will react negatively to the news, at least over the short term, but that's normal after yesterday's 28.4% rally. The stock is down about 9% in the pre-market.

Anyway, I believe the key sentence in this report is the following, under "Business Outlook":

«In October, average net daily revenue was up approximately 15 percent over that achieved in the third quarter.»

So we know the 4th quarter is shaping up to be much stronger than the 3rd. Probably GIGM will do $0.20 EPS in Q4 and that sets the stage for $1 plus EPS in 2008.

I'll keep holding GIGM for the long term.

Powerful day yesterdy.......
Oversold

Down in the Pre-Market this morning.

GIGAMEDIA LTD (NasdaqGS:GIGM)   

Pre-Market: $20.11  -0.99 or(-4.67%) as of 9:04AM ET on 11/14/07



Technicals
Close Above the 50-day EMA
Close Above the 13-day EMA
Percentage Gainer
Price Gainer

Last Price Quote is:
1.27%above 13-day EMA
10.50%above 50-day EMA
RS Rating: 2 

Fundamentals
Earnings Expected on Nov 14

Key Data:
Market Cap (M): $998.75 
P/E Ratio: 32.39 
PEG Ratio: 0.83 
Next Earnings: 03/18/2008
Last Analyst Rating: Outperform



Q3 2007 GigaMedia Limited Earnings Release - Before Market Open
• GigaMedia Limited Earnings Call scheduled for 8:00 am ET today
REFILE-UPDATE - Taiwan's GigaMedia Q3 beats Street expectations
at Reuters (Wed 8:21am) 

Gigamedia Q3 results.......
GIGAMEDIA LTD (GIGM): * Q3: record revenues, up 76 percent y-o-y * Third quarter GAAP earnings per share $0.18 * Third quarter non-GAAP earnings per share $0.19 * Third quarter revenue rose 76 percent to $43 million * Third quarter non-GAAP diluted earnings per share $0.17 * Forecasts to launch Hellgate: London in the second to third quarter of 2008 and Holic in the second half of 2008 * Reuters Estimates third quarter earnings per share view $0.14, revenue view $42.36 million * Forecasts continued strong performance in gaming software business in fourth quarter * Says retained financial advisors to assist with planned disposal of legacy business unit * Says remain in discussions with identified buyers concerning potential sale of the business


Yesterday's closing chart.......

Does anybody have the info from the conference call, unfortunately I wasn't able to listen to it and I won't be able to listen to the replay until later tonight. I see the stock is down over $2, i was thinking about buying back into the stock, but I am concerned about what was said on the conference call, (and if anything they said would cause the stock to tumble 10%)

Thanks

Quote from: eggman11 on November 14, 2007, 09:51:25 AM
Does anybody have the info from the conference call, unfortunately I wasn't able to listen to it and I won't be able to listen to the replay until later tonight. I see the stock is down over $2, i was thinking about buying back into the stock, but I am concerned about what was said on the conference call, (and if anything they said would cause the stock to tumble 10%)

Thanks

I'm listening to it now, I'll get back to you in a moment. I think the 10% drop is due to the sequential decline in EPS (which I believe is caused by seasonality). Also the stock was up 28% yesterday.

So far nothing in the conference call to take the stock down 10% in my opinion ... it is entering the Q&A session now.

[/quote]
I'm listening to it now, I'll get back to you in a moment. I think the 10% drop is due to the sequential decline in EPS (which I believe is caused by seasonality). Also the stock was up 28% yesterday.
[/quote]

Thanks David,

I am looking forward to one of your usual excellent CC summaries when you are done listening to the call.