GOAM

[Se7en]

I bought a few hours ago at 6.10$, thought I was 'too late' ... 

[rickjust]

hi,
i put a limit order in for 589 after the first foray into 600. went out for a while and came back to find my limit had been hit and it was now a dollar higher. thanks for the pick david,
i will probably take my profits tomorrow . good luck to those who will continue to hold,
maxi

[David Randolph]

Thanks for your kind words guys

I was surprised and lucky about what happened yesterday in GOAM, since I wasn't expecting the stock to run as it did in such a short period of time. In our stock market life we need to be prepared for instant failure and also instant success, so I see yesterday's quick gain as business as usual.

Probably the stock will pullback some today, or else it will run another 20%, I honestly don't know.

This is a different type of trade (as you can see no valuation model was computed). It is a revenge trade and maybe it will be worse for me, over the longer term, to be successful in this flip flop than not.

The idea was to get my TZOO money back, and I needed GOAM to rise, let me see, 39.12% from my buying point. For that I would need to take profits on GOAM at $7.8. That's what I'll do if I get the chance.

The trading plan is to take profits on GOAM between $7.7 and $7.90 (don't you put a barrier at $7.8 or else the market will see it and won't touch it - I'll spread my sell orders around $7.80, but not at that exact price and not all at the same time - I prefer to hit bids instead of being a sitting duck with my orders exposed).

Ahh, I can almost see the mistake coming here ... I'm going to take profits and indeed, GOAM will have a surprising profitable quarter and it will open at $12 - $14 in a few days. But I can't start one trade with a specific objective and then change it, can I? No, that could be damaging from a psychological perspective. Imagine GOAM goes to $7.8, I don't take profits because I expected more, and then earnings come out at a loss (again) and the stock opens down 20%? I had the chance of fulfilling the objective, but didn't took it. I would be confused in the market place, and no speculator is able to think and function well in that situation. I need to protect my mind and spirit so I'm not going to turn a speculative venture into an investment.

Therefore and again, the trading plan is:

Take profits around $7.8.

[Garoh]

David

The traget price for this run it should be around $8.70
It had a nice run yesterday with good volume .... This stock is crazy you might see it at 12 in minutes 

[Houlahan]

Yes, we need to be patient.
yours truely,  Ms. Warren

[rickjust]

hi,
sold at 670,
"never underestimate a small amount of money"
thanks
maxi
glta holding

[Se7en]

Thanks for your kind words guys



The trading plan is to take profits on GOAM between $7.7 and $7.90 (don't you put a barrier at $7.8 or else the market will see it and won't touch it - I'll spread my sell orders around $7.80, but not at that exact price and not all at the same time - I prefer to hit bids instead of being a sitting duck with my orders exposed).

Yep; however if it can break the $7.80 area on some decent volume, this puppy ain't done yet ...

[David Randolph]

David

The traget price for this run it should be around $8.70
It had a nice run yesterday with good volume .... This stock is crazy you might see it at 12 in minutes 

$8.70? Ok, but that would be serving a different objective of the one I have now. I'm glad you're in GOAM, good luck

Yes, we need to be patient.
yours truely,  Ms. Warren

I agree Ms. Warren, patience is a needed virtue for any investor.

hi,
sold at 670,
"never underestimate a small amount of money"
thanks
maxi
glta holding

Nice profit Maxi, I see you're back to your old method of swing trading, but now holding stocks for a bit longer. It's a good step, I wish the continuation of your success man

Yep; however if it can break the $7.80 area on some decent volume, this puppy ain't done yet ... 

Nice chart Se7en, thanks for pinpointing the resistance area.

Ok, I'll maintain the "take profits at $7.8" if you get the chance trading plan, or else "hold", but I almost wish the stock doesn't go there before the Q1 earnings release, so I have the chance of selling it much higher if we get something like $0.2 EPS for the quarter, which would mean Net Income of about $500 K, which seems entirely possible on the $5 - $5.5 M revenue expectation I have for the quarter.

Last year Q1 results were out on May 11, today is May 10, so they can be published any minute now.

For today the trading plan is take profits around $7.8 if the opportunity arises, otherwise keep holding. Technically the stock came back down to test the 50 days SMA, prior resistance, now support, and it should climb back up again today.

[rickjust]

hi,
sold at 670,
"never underestimate a small amount of money"
thanks
maxi
glta holding

Nice profit Maxi, I see you're back to your old method of swing trading, but now holding stocks for a bit longer. It's a good step, I wish the continuation of your success man




hi david ,
thanks for the kind words. i am sticking to Zurich Axiom 2 , on greed. Always take profits too soon
i got lucky with this one . i didn't really plan it and it paid off . best for me to say thank you , and move on.
glta still holding, i hope it hits the 780 mark ( or close)
max

[David Randolph]

From what I've read back on this thread, GOAM has 12.5% of the IP relay service market so I expect it to have at least that share of the Video Relay market, which is now about a $90 M a quarter market. This means $11.5 M in revenues a quarter for GOAM, wow! I mean "wow" because GOAM's revenues in Q4 2006 were $4.2 M and the market cap of the company is just $16 M.

It would be nice to know the net profit margin of providing the VRS service at a $6.44 per minute reimbursement rate.

Anyway, even though I pray for GOAM not to get to $7.8 before the results, I need to stay objective and focused on this trade, so for today the trading plan remains: "Take profits around $7.8".

[wxmang]

Well...
At least the Low Volume in GOAM is mainly small fishes buying:
http://clearstation.etrade.com/cgi-bin/details?Symbol=GOAM&csize=06&PositionId=2147483647&Event=peek&period=d

[David Randolph]

At least the Low Volume in GOAM is mainly small fishes buying:

You meant small fishes "selling", right?

I have this plan of taking profits in GOAM if the stock reaches the $7.80 area, but I'm happy that it didn't, because I feel I'll have the chance of selling the stock much higher. Let me try to explain, by topics, my current thinking on GOAM:

1) I thought the stock was too cheap between $5 and $6 and took my position at $5.61. My analysis says investors sold the stock due to a disappointing 4Q 2006, but that wasn't right, because the real action only started in January 2007 when the company launched its VRS service. I believe the market will be positively surprised by Q1 2007 results, perhaps so surprised that the stock will open with a huge gap up, we'll see.
2) Anyway, I see this trade as an opportunity to get back the money I lost in TZOO quickly (which isn't a sound course of action, but we're all humans). This is why I have this plan of taking profits at $7.80 if I get the chance. Why isn't GOAM a long term investment like all others of the Main Portfolio? Because, as we've discussed previously in this thread, the company operates in an industry that will have zero profit over the long run, because the reimbursement rate that the FCC pays is fixed in connection with the cost of providing the service, making sure there are no profits over the long run. Even though some companies can be profitable, the industry can't over the long run, because if the FCC sees profits it will cut the rate it pays for the IP relay service and the Video relay service (VRS).
3) But if the market sees, for example, $0.20 EPS for the quarter, I'm sure the stock will open at $10 - $12 (people won't know or consider the FCC issue at that time, one has to dig a lot to find it). And  it would take just $500 K net income to achieve $0.20 EPS. Why do I think a $0.20 EPS is possible, right here, right now, in Q1 2007?
4) Because the VRS market is a $100 M a quarter market. GOAM has 12.5% of market share of the IPRS market, so I assume it will also get a 12.5% share of the VRS market over the long term. Say GOAM has just 5% of the VRS market in Q1 2007, that will mean $5 M in new revenues in Q1 alone. The costs of developing and marketing the service were already made in Q4 2006, so, with about $9 M in revenues in Q1 2007, I guess $0.5 M in net income is achievable (that would mean a 5.5% net profit margin)
5) What if GOAM loses money? What's the risk? I don't see much risk, because the company's book value is $11.061 M (current market cap is $15.39 M), and 2007 revenues will be at least $24 M (they were $12 M in 2006, up from $8 M in 2005). I don't see the stock trading below a market cap of $11 M - $12 M, that is, about $4.7.
6) Considering my $5.61 entry point, the short term potential reward is 96%, the short term potential risk is about 16%. I'll take it.

So, the trading plan remains "take profits at $7.8 if you get a chance before results", after results I'll make a new analysis and adjust the trading plan accordingly.

[wxmang]

I know you guys are gonna laugh at this..
But if you are into this sort of thing, you might enjoy this prediction chart:
http://www.stock100.com/plotForecast.asp?symbol=GOAM&history=200&future=30



Wxmang

[David Randolph]

I know you guys are gonna laugh at this..
But if you are into this sort of thing, you might enjoy this prediction chart:
http://www.stock100.com/plotForecast.asp?symbol=GOAM&history=200&future=30



Wxmang

Hi Wxmang, that's a funny site. They probably programmed a technical system to make those forecasts. It's nice to see their system still sees GOAM as bullish, even though the stock went down about 50% between December 2006 and April 2007. I also see GOAM's chart as bullish, since it reacted well to the 200 days SMA long term support and it is also above the 50 days SMA now.

Earnings were not out yet, so I'll keep the plan of taking profits at $7.8 if I get the chance. If not, I'll keep holding GOAM.

Was it Se7en that asked about GOAM's earnings date on NGA's thread? I guess Q1 2007 earnings will be published this week, last year they were released in May 11.

[realcoolhead]

So is today the deadline for 10-Q?