PAX

[David Randolph]

The all time chart shows this stock is at its long term lows:



Yesterday, due to very significant news (but that's not my business), the stock broke a medium term descending trendline with volume 1303% above average:



PAX made a strong white marubozu with 4.23M shares traded. It rose 120% yesterday:



This is an high risk play, but the 3 SOF Fast is made for high risk players.

The trading plan is as follows:

1) Buy it at the open if it is below $1 (don't buy if the open is above $1 and later the stock comes down below that level. If the open is above $1, forget the stock).
2) If there was a buy at the open which was below $1, sell the stock 100% higher if you have the chance.
3) Take a loss if the stock is set to close below $0.72, the midpoint of yesterday's white candle.

Big risk, big reward, but the reward is much higher than the risk. So I'll take it, with $5,000 for the 3 SOF Fast Portfolio.

[la-onda]

awesome pick David(Applaud) 

[LiveLife]

Nice pick = applaud =

As you recommended, as soon as I sold TMTA, I bought PAX at $0.97 - $1.02.  I am watching my sell target.

BTW, new CEO and deal with NBC (owned by GE) is great news for PAX!

http://biz.yahoo.com/ap/051107/paxson_ceo.html?.v=3

[bigdogs99999]

This pick is great David ... though I might be tempted to have it in one of the other portfolios.  The debt load is an issue, but the events of the last two days could over the next few months unlock the value of having 60 TV stations which is an AMAZING  asset (and why less than 4 years ago this stock was in double digits).  Applause!

[stopthemadness]

LiveLife, what are you looking at as your sell target?

btw, are you still in GNBT? you move around so much... 

[fous]

Great pick David, (applaud)

I actually found this one last night and posted it on the stock picking board. Glad to see it caught your eye as well 
http://www.3stocksonfire.org/trading/index.php?topic=3530.0

Got up up a little late this morning  . But still in at 1.04.

good luck fellow holders,

-fousc

[fous]

Paxson Communications Corporation. The Group's principal activity is to operate as a network television broadcasting company that owns and operates the broadcast television station group in the United States of America. The Group currently owns and operates 61 full power broadcast television stations and operates PAX TV, which is a network that provides family oriented entertainment programmes. PAX TV's programming consists of shows originally developed by the Group and shows that have appeared previously on other broadcast networks that the Group has purchased the right to air. The Group derives revenue from the sale of network spot advertising time, network long form paid programming and station advertising.


PAX's CEO announced that he is resigning and NBC and PAX reached a new agreement wich sent the stocks pps skyrocketing today. The details of the new agreement are below



New CEO:Paxson Communications Appoints Brandon Burgess Chief Executive Officer; Lowell W. Paxson Becomes Chairman Emeritus
11/7/2005 8:52:01 AM

New Agreement between PAX and NBC![/color][/b][/size]

NBC Universal and Paxson Communications Reach Strategic Agreement; Agreement Bolsters Strategic and Financial Flexibility of Both Companies; Brandon Burgess to Join Paxson Communications as Chief Executive Officer
11/7/2005 8:51:17 AM

   NEW YORK & WEST PALM BEACH, Fla., Nov 07, 2005 (BUSINESS WIRE) -- NBC Universal and Paxson Communications Corp. ("Paxson Communications") (PAX) today announced a definitive agreement that sets the stage for a strategic and financial restructuring of Paxson Communications, which owns and operates the nation's largest broadcast distribution system, consisting of 60 television stations and reaching 83% of domestic television households (approximately 91 million homes) via its station group and cable and satellite platforms.

Under the new agreement NBC Universal and Paxson Communications have modified the terms of NBC Universal's existing Series B preferred stock investment and related agreements. NBC Universal has acquired an 18-month call right from Paxson Communications' founder Lowell "Bud" Paxson to purchase all of Mr. Paxson's common shares, including his voting control shares. Although NBC Universal cannot currently exercise the call right under existing FCC rules, it may transfer the call right to a third party who may exercise it (subject to all necessary regulatory approvals). If the call right is exercised or transferred within 18 months, NBC Universal or its transferee will make a tender offer for all of Paxson Communications' outstanding Class A common stock, subject to all necessary regulatory approvals. If NBC Universal or its transferee fails to initiate a tender offer in the 18-month timeframe, NBC Universal will, as an alternative form of value, deliver $105 million of its Series B preferred stock back to Paxson Communications for distribution to Paxson Communications' Class A shareholders (excluding Mr. Paxson). The form of the consideration the public shareholders will receive depends on whether the call right is exercised. Also, NBC Universal and Paxson Communications have settled all pending legal disputes, including court proceedings and arbitration, which will be dismissed.

"NBC Universal has been the largest financial investor in Paxson Communications for some time, and we continue to believe that Paxson Communications has a compelling national platform," said Bob Wright, Chairman and CEO of NBC Universal. "This agreement gives Paxson Communications the flexibility to invite new partners and investors who do not face the same FCC limitations that we do and who are interested in investing in and programming a nationwide television distribution platform."

"We believe this agreement with NBC Universal will improve our Company's ability to realize the value of its assets and distribution platform, while providing our public stockholders an opportunity to receive enhanced value for their shares," said W. Lawrence Patrick, Chairman of the Special Committee of Paxson Communications' Board of Directors. "Furthermore, the agreement affords the company the flexibility necessary to attract strategic partners and investors, to improve prospects for refinancing, and to more cost effectively strengthen the company's balance sheet."

Terms of the Transaction

NBC Universal has acquired a transferable 18-month call right on all of Mr. Paxson's common shares, including his Class B voting control shares. NBC Universal paid Mr. Paxson $1.00 per Class A share and $1.15 per Class B share (a total of approximately $25 million) to acquire the call right. The exercise price of the call right is $0.25 per Class A share and $0.29 per Class B share. In order to exercise the call right, NBC Universal or a party to whom it transfers the call right must make a tender offer to purchase all Class A shares held by the public shareholders (other than those held by Mr. Paxson) at $1.25 per share. The $1.25 tender price will increase at a rate of 10% annually until the tender is commenced. In the tender offer, Paxson Communications' public stockholders will have the option to sell their shares at the tender price or retain their shares.

If the call right is not exercised or transferred within 18 months, then Paxson Communications public shareholders (excluding Mr. Paxson) will receive instead $105 million face value of Series B preferred stock (increasing at a rate of 10% until delivered) of a comparable rate type and equal rank to that owned by NBC Universal and will retain their common stock. In this circumstance, Paxson Communications would exercise the call right to purchase and retire Mr. Paxson's control shares, after which Mr. Paxson would no longer be a stockholder in the company.

As part of the agreement, NBC Universal agreed to reduce the accrued and unpaid dividends on its preferred stock (which were $288.6 million as of September 30, 2005 based on the disputed 28.3% dividend rate) by $100 million and to accept $188.6 million of additional Series B preferred stock issued by Paxson Communications to NBC Universal in full satisfaction of all accrued dividends through September 30, 2005. NBC Universal has also agreed to reduce the annual dividend rate on the resulting $604 million in preferred stock to 11% (reducing the annual dividend accrual on the Series B preferred stock by approximately $50 million) and to extend the redemption date of the Series B preferred stock from December 2009 to December 2013. The Series B preferred stock is convertible into common stock, subject to FCC and other limitations, at a price of $2.00 per share (reduced from $22.06 per share), which increases at the same rate as the dividend rate. The Series B preferred stock remains exchangeable at the option of the holder (subject to certain conditions) into subordinated debentures with a maturity date of December 31, 2009.

NBC Universal also purchased from Paxson Communications Series B preferred stock for $2.5 million and cancelled warrants it held to purchase approximately 32 million shares of Paxson Communications Class A common stock. NBC Universal remains a non-attributable investor in Paxson Communications under FCC rules.

Paxson Communications Management and Board of Directors

As concurrently announced today, Mr. Paxson has resigned as Chairman and Chief Executive Officer of Paxson Communications. R. Brandon Burgess, who resigned from NBC Universal where he was Executive Vice President of Business Development and International Channels, joins Paxson Communications as a member of the Board of Directors and will assume the responsibilities of Chief Executive Officer of the company on November 10, 2005. Mr. Paxson was named Chairman Emeritus, and he will continue to serve as single majority stockholder of entities holding Paxson Communications' FCC licenses until the purchase of his shares is complete and regulatory approval has been granted.

The transactions described in this release were unanimously approved by Paxson Communications' Board of Directors upon the recommendation of a special committee of independent directors comprised of W. Lawrence Patrick, Henry J. Brandon, and Raymond S. Rajewski. Lazard served as independent financial advisor to the Special Committee.

The Paxson Communications Board also includes Dean Goodman, the company's President and Chief Operating Officer, who will remain in that position. The Board will recruit up to four additional qualified independent director candidates to fill Board vacancies. The Board of Directors has also appointed Mr. Patrick, who served as Chairman of the Special Committee, as Chairman of the Board.

About NBC Universal

NBC Universal is one of the world's leading media and entertainment companies in the development, production, and marketing of entertainment, news, and information to a global audience. Formed in May 2004 through the combining of NBC and Vivendi Universal Entertainment, NBC Universal owns and operates a valuable portfolio of news and entertainment networks, a premier motion picture company, significant television production operations, a leading television stations group, and world-renowned theme parks. NBC Universal is 80% owned by General Electric, with 20% controlled by Vivendi Universal.

About Paxson Communications Corporation

Paxson Communications Corporation owns and operates the nation's largest broadcast television station group. Paxson reaches 83% of U.S. television households via nationwide broadcast television, cable and satellite distribution systems. For more information, visit Paxson's website at www.paxson.com .

Note: Paxson distribution data provided by Nielsen Media Research.

-fousc[/color][/size]

sorry i just discovered this moving text thing, i kinda like it 

[bigdogs99999]

In doing a bit of reading on the PAX board, I found a reference to AFOP.  I backed up the truck!  Volume way up.  Great fundamentals: 40.57M market cap, 29 million in cash , no debt, 20 million in sales and growing, and insider buying. I'd love to hear some other thoughts on this one David or others.

AFOP not AFOB, sorry!

[dhiraj19]

BigDoggs,
DId you type it correctly AOFB ? Cant find it.
- Dhiraj

[Terliso]

I bet there would be a profit taking tomorrow..

[LiveLife]

Terlisa, I agree that after such a large gain for PAX in two days, profit taking should be anticipated.

stopthemadness, I had "parked" my trading capital for 1 day with GNBT way before the NVAX re-buy back and swing trades with HEB, SANM and TMTA.

My initial sell target for PAX at buy in ($0.97 - $1.02) this morning was around $1.20 - $1.30, which would be $8,600 - $13,000 gain.

If there is an early open profit taking, I may ride it out if the price drop is too fast (can't move 43,600 shares that fast)  .  If not, I may sell and buy back after profit taking.

If there is significant gain after market open ($0.10 - $0.30), I probably will take profit, and buy back on dip.  I will have to watch the activity at market open.

Good trading!

[la-onda]

http://www.hollywoodreporter.com/thr/business/article_display.jsp?vnu_content_id=1001434983

Paxson CEO out as part of NBC Uni settlement

By Paul J. Gough and Georg Szalai
NEW YORK -- NBC Universal and broadcaster Paxson Communications unveiled a broad new agreement Monday that settles their long-standing legal and financial disputes. The deal includes the departure of Paxson founder Lowell "Bud" Paxson as chairman and CEO and gives NBC Uni an 18-month window to buy the company or find another buyer.

Paxson, the majority shareholder in the company who now takes on the title of chairman emeritus, will be replaced as CEO as of Thursday by Brandon Burgess, who has resigned his post as NBC Uni executive vp business development and international channels.

NBC Universal owns 32% of Paxson, a stake the company bought in 1999 for $415 million with the hope of raising it once the FCC eased restrictions on the number of television stations a single company can own. But even with the FCC's relaxation of those limits during the past few years, NBC Uni still is barred from taking complete control of Paxson, which owns 60 UHF TV stations that reach 83% of U.S. TV households.

"We continue to believe that Paxson Communications has a compelling national platform," NBC Uni chairman and CEO Bob Wright said. "This agreement gives Paxson Communications the flexibility to invite new partners and investors who do not face the same FCC limitations that we do and who are interested in investing in and programming a nationwide television distribution platform."

Burgess stressed that it was his decision to leave NBC Uni, where he had been considered a rising star, to take the reins at Paxson.

"I really believe in these assets. I have for years," Burgess said. "We've seen how hard it is for content providers to roll out new digital networks with a (subscriber base) of only 30 million-35 million homes. (Paxson) reaches over 90 million TV households on an analog basis. There's a lot of opportunities for Pax that we hadn't been able to follow up on. Now we will."

Under the leadership of Lowell Paxson, the Paxson stations were steadfastly focused on wholesome, family-friendly programming. With the change in ownership, Burgess and his team will have more flexibility to seek a wider range of programming and prospective content partners.

NBC Uni Television Networks Group president Randy Falco suggested that the Paxson group could be an intriguing investment opportunity for innovative programming ideas from a new-media hotshot a la Yahoo! or Google.

"It may be that we just find a new financial partner, but it'd be great to find a creative partner," Falco said. "The potential is unlimited when you think about a Yahoo! or a Google putting together something using the Paxson platform as an interactive search engine or something along those lines. We haven't had those discussions with anyone yet, but there are plenty of ideas out there that are interesting."

Under the agreement announced Monday, NBC Uni bought for $25 million an 18-month call right for to buy all of Lowell Paxson's shares. NBC Uni can exercise that right itself or transfer it to a third party, who in turn can exercise it. Whoever exercises the call right must also make a tender offer for all of the company's class A common stock.

If NBC Uni or its transferee fails to launch a tender offer within the 18-month time frame, NBC Uni must under the deal deliver $105 million of its series B preferred stock to Paxson Communications for distribution to the firm's class A shareholders excluding Lowell Paxson.

If it does exercise the option, NBC Uni will pay 25 cents per common A share and 29 cents per common B share for Lowell Paxson's stake. In addition, it must make a tender offer for the remaining class A shares at $1.25 each. This price rises 10% annually until a tender offer is made. Lowell Paxson owns 100% of the firm's class B shares and 10% of its class A shares.

For financially struggling Paxson, the new arrangement provides "some desperately needed financial relief" and extra time, said Anderson & Strudwick analyst Steven Marascia.

Although at this stage anything is possible, Marascia suggested that NBC Uni could structure a deal with a third party that would give it control of at least some stations fitting into its portfolio. "They will likely comb through the portfolio" to see what they can keep, he said.

Paxson shares were up 112% on heavy trading volume Monday to close at $0.87.

[LiveLife]

I just posted 7 new posts regarding PAX here: (scroll towards bottom) 

http://www.3stocksonfire.org/trading/index.php?topic=3530.msg31779#msg31779

[David Randolph]

I don't want to be a fundamental player here, but when there's the prospect of a tender offer at $1.25 or $105M given to shareholders of common shares, I see almost no risk on this play.

The doubt is: will it go a lot higher or will it stay between $1 and $1.20, waiting for the tender offer? (actually the $105M would be more, since buying all common shares at $1.25 will cost NBC Universal something like 64,569,508*$1.25 = $80.71M)

I don't have an answer, but I already see names like Google and Yahoo on newspapers related to this deal, and this may propel speculation with PAX.

Well, this is just a Fast Portfolio, I want to make money every single month and I don't want to hold shares for more that 3 to 4 days. I think at least $1.15 is granted. I'll take my money around that level and move on.

[LiveLife]

David Randolph adjusted his sell target for PAX at $1.15.

I have lowered my limit sell price to $1.15 from $1.20 for today.

1.  If I sell, I will wait for a dip/rebound and buy back.
2.  If there is no rebound, I will move on to my next stock (may be TMTA).
3.  If there is a continued to sell off at market open, I will sell and wait for a dip/rebound and buy back.
4.  If there is no rebound after early morning sell off, I will move on to my next stock.
5.  If PAX is sideways at open and gradually gains, then I will hold, but still maintain my limit sell at $1.15
6.  If PAX is sideways at open and gradually declines, then I will sell and wait for rebound activity.  In the meantime, I will buy another stock that is "actively" gaining.

Good trading!