3SOF

Volume wasn't as big as a momentum trader would like, but momentum traders probably will only see MSI when it closes above $3

Perhaps the consolidation phase isn't over yet, and MSI will come back down a bit again, but the fundamental value of the Movie Star + Frederick's of Hollywood combination seems much superior to me.

As I said, without further details on the merger or other fundamental news, I'm not willing to sell MSI below $6, whatever happens to the chart. Because, with the current publicly available information (which isn't a lot), I perceive MSI value per share as something around $8, so how could I sell it here at $2.5?

The reasoning is explained back on this thread. I'll keep holding MSI with strong hands, taking advantage of already having a 30% profit on the stock.

I feel something is about to come out on the Movie Start + Frederick's of Hollywood merger. Perhaps some more financial details on FOH?

I really like www.fredericks.com as a sales channel, as we've discussed previously.

Volume is picking up steam. If MSI pushes through $3 it will probably make a very quick move towards $4.

Anyway, as I've said, with the current public information on the two companies, I see MSI's value around $8, so, unless the market gives me at least $6, I won't consider selling.

Besides being the "original sex symbol", Frederick's of Hollywood is "too hot to handle": www.fredericks.com

But not a whole lot of fire on MSI's shares on Friday. It doesn't matter, I have the necessary patience to wait for the big move above $3.

I'll keep waiting and holding MSI.

I know it has been said on these threads before that if a stock looks like it is going negative and maybe a cause of concern do we sell or buy more because fundamentally it should still do well. I may have gotten the words wrong a little here but hopefully I made sense. I believe in this stock and own it as well so....would a prudent investor take a look at this and buy on the dips assuming it will cross $3? It's down 10% today and I would think a great buying point but certainly do not wish to chase after a stock that will continue falling as that would be good money after bad.

I have the same profit right now as the Main Portfolio so I am still in the money but want to be more in the money.

Any advise on this? I have patience as well but wish to be more than rewarded for that patience if I can.

I would buy here.  MSI looks to be forming a symmetrical triangle, with 2.17 forming the bottom.  I wish I had more cash to buy here.

Quote from: lancefur on January 29, 2007, 11:50:19 AM
I know it has been said on these threads before that if a stock looks like it is going negative and maybe a cause of concern do we sell or buy more because fundamentally it should still do well. I may have gotten the words wrong a little here but hopefully I made sense. I believe in this stock and own it as well so....would a prudent investor take a look at this and buy on the dips assuming it will cross $3? It's down 10% today and I would think a great buying point but certainly do not wish to chase after a stock that will continue falling as that would be good money after bad.

I have the same profit right now as the Main Portfolio so I am still in the money but want to be more in the money.

Any advise on this? I have patience as well but wish to be more than rewarded for that patience if I can.

The problem with buying more is that your hands will probably get weaker. You'll get more nervous if you're holding a bigger than average position on one single stock.

Anyway, I'm positive that MSI's value is much superior than the current share price implies, but of course, I/we don't know everything there is to know about the company.

The worst thing that could happen was if they terminated the merger with Frederick's of Hollywood, that would really make an ugly sell off, but ... so far there's no indication to that, I sure hope that's not the case, as I'm seeing a 40% or so profit turn into just 15% as I write

Quote from: David Randolph on January 29, 2007, 02:22:35 PM
The problem with buying more is that your hands will probably get weaker. You'll get more nervous if you're holding a bigger than average position on one single stock.

Anyway, I'm positive that MSI's value is much superior than the current share price implies, but of course, I/we don't know everything there is to know about the company.

The worst thing that could happen was if they terminated the merger with Frederick's of Hollywood, that would really make an ugly sell off, but ... so far there's no indication to that, I sure hope that's not the case, as I'm seeing a 40% or so profit turn into just 15% as I write

This was my fear as well but I hate not taking advantage of big dips and not huge rebounds. This is a risk but I am trusting in the fundamentals and techical reads. I am by no means an expert but I did purchase another 5000 shares with only holding 8000 shares now. I just hope it doesn't tank! I hope not as I saw the same profit drop too.    But I remain cool and patient.

Two things might be happening on MSI:

1) The stock is still in the process of consolidating the 250% gains it made over the November 14, 2006 - January 11, 2007 period, which would be perfectly natural;

2) There are negative news pending on the background, not yet public, but to be known soon. The worst news could be if they terminated the merger agreement with Frederick's of Hollywood. Another possible news is, for example, financials for FOH coming out and showing a lot of debt or historical net income losses.

For now I'll go with the first hypothesis, because that's the one that makes more sense to me. But I'll consider the second hypothesis too.

If MSI is on scenario 1, the reward of this trade can be something like 200% over the next 3 or 4 months. If MSI is on scenario 2 it will go back down to $1 or so.

I want to be in for the big bullish move of scenario 1, but I don't want to risk losing 66% or so of my money on this position if we're on scenario 2. In fact, having been up more than 40% on this trade, it could be psychologically damaging to lose money on it.

So, the trading plan for MSI is:

HOLD for as long as the stock trades above $1.93. Bail out if it prints $1.93.

Never let a meaningful profit turn into a loss. 

I am looking at insider trading for msi. 56k may not be important but funny thing is
on the same day one guy buys 56,666 shares and other sells exact 56,666 shares.
I say.....YO!!just throw those certificates across the desks 

From etrade.

Insider Sentiment

"
COLE PETER G became the first insider to ever purchase MSI stock with a buy of 56,666 shares on January 18, 2007."

"1) The stock is still in the process of consolidating the 250% gains it made over the November 14, 2006 - January 11, 2007 period, which would be perfectly natural;"

I see this as pure consolidation.  Nice symmetrical triangle forming after a run up.  See chart below.

"2) There are negative news pending on the background, not yet public, but to be known soon. The worst news could be if they terminated the merger agreement with Frederick's of Hollywood. Another possible news is, for example, financials for FOH coming out and showing a lot of debt or historical net income losses."

That is a scary scenario, but I do not believe it.  Movie Star's Board of Directors already performed due diligence before the merger agreement.  As stated in the 8K:

The Board of Directors of Movie Star unanimously approved the Merger
Agreement and the transactions contemplated thereby on the unanimous
recommendation of a Special Committee comprised entirely of independent
directors (the "Special Committee"). The Special Committee engaged Chanin
Capital, LLC ("Chanin") to serve as its financial advisor. On December 18, 2006, Chanin delivered an opinion to the Special Committee on which Movie Star's Board of Directors was entitled to rely, stating that, as of the date of the opinion, the Merger Consideration to be paid by Movie Star to the holders of FOH Common Stock is fair to the holders of Movie Star Common Stock from a financial point of view.

Then what the heck is wrong with this stock? Just a massive consolidation from the massive run-up? I hope so because I would love this to take off again with the position I have at a low cost basis.

Quote from: lancefur on January 30, 2007, 09:44:25 PM
Then what the heck is wrong with this stock? Just a massive consolidation from the massive run-up? I hope so because I would love this to take off again with the position I have at a low cost basis.

Ok, I guess that selling pressure is explained by today's form 8-k filed with the SEC:



This is a relief.

QuoteThat is a scary scenario, but I do not believe it.  Movie Star's Board of Directors already performed due diligence before the merger agreement.

My worries were on the part of Frederick's of Hollywood terminating the merger agreement, not on Movie Star's part, because I think the merger agreement is more favorable to MSI than to FOH.

Anyway, that's not to be expected, some minor negative news were just out, but not significant, so probably today's sellers will be the last around current levels.

I'm changing my trading plan on MSI again, to HOLD whatever happens to the share price. I don't want to lose Frederick's business just because some people decided they had too much profit and wanted to sell.

MSI actually rose 1.32% on the day after restating cash flow numbers. That is a positive sign. Volume picked up too. As I wrote:

QuoteAnyway, that's not to be expected, some minor negative news were just out, but not significant, so probably today's sellers will be the last around current levels.

I expect MSI shares to start a new bullish leg that will take it above $3 anytime soon.

Not a bad day for MSI, im going to try to enter a position tomorrow.

Quote from: nullzero on February 01, 2007, 04:06:34 PM
Not a bad day for MSI, im going to try to enter a position tomorrow.

Cool nullzero, I think it's a good choice. Moving up after a piece of what is usually perceived as bad news (restatement of cash flow numbers imposed by the SEC) is a good sign.

Let's check one of the main reasons for this investment: www.fredericks.com ... yep, too hot to handle.

Technically the stock is ready to make its second bull wave (Elliot theorists would call it "wave 3"), that can take MSI towards $5.

As I've been writing on this thread, I'm not willing to let go of MSI below $6 (unless the merger agreement between MSI and Frederick's of Hollywood doesn't come to fruition). I was a bit shaky when the stock started going down, but I was relieved by the bad news out, probably that was the cause for the technical weakness. I was worried it could be something worse. Not anymore.

I'll keep holding MSI with strong hands.