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LGND.PK - Up 11% on pretty high volume.
While I'm excited it's up that strongly, there is no reported reason why it should be. So that leaves me to believe either something is imminently happening or some large investor is looking to get in.
Note that they still have to file their financials and the deadline is around Nov 2.
LGND.PK - the company has approx. 30 days to refile for their NASDAQ listing, since they are restating financials. Deadline I believe is around Nov 2. A dissident shareholder (Daniel Loeb) from Third Point, has stated they want company to start looking at alternatives to enhance shareholder value. A letter was filed w/ the SEC. He states company is valued at min of $14 worst case. Stock now up to $9.15 + 4% today, I got in last month around $7.80.
AVSO - gilead, Yeah I thought the numbers were juicier w/out the one time revenues, but I agree it is a value. Just not as much of a layup.
AVSO - Seems to be one time revenue gain from sale in Jan 05 of developed software of $1.9mm in a further breakdown of their revenues. This would wipe out most of their income for the past 12 months.
"(1) Excludes revenue of $1.9 million from the sale of developed software, Proof Positive, to our major supplier, due to the unique nature of this revenue."
Anyone looking at LGND.PK?
They are a pharma co, that got tossed to the pinks because they have not been able to file on time. Financials are being restated, so not sure if reliable, but the last audited fin'l have them generating $116mm rev (9/04) for the first 9 months and a loss of .46. Not very good numbers, but I found the letter from a dissident shareholder very encouraging. Because mgmt has been a bit inept, a large dissident shareholder has moved to shakeup the executive board to explore alternatives. Enclosed is the filing.
http://ccbn.tenkwizard.com/filing.php?repo=tenk&ipage=3697935&doc=4&total=5&TK=LGND&...
Misquote? Harrisdirect shows .04
Rogue - One of my recent RE plays has been buying short dated puts on JOE. I cashed out today on some Aug 75 puts. From .20 to 1.6 I got out. Lucky call, but looking for another opportunity to get back in. With less than two weeks to expiration didn't want them to expire worthless. Also it's good when you can sell during periods of high volatility and buy during low volatility as it has a large impact on option pricing.
Primal Solutions (PSOL)
They should be reporting soon (w/in 2 wks). They provide billing services to VOIP service providers. They have Time Warner lined up as well as another cable MSO they have not disclosed. They lost a billing contract for a paging service from Metrocall earlier. It's come around in the last several months from the low teens to .25 today. Time Warner Digital Phone business has been expanding rapidly and this stock should move w/ it. Raging Bull has a good message board w/ some historical info.
http://www.ragingbull.lycos.com/mboard/boards.cgi?board=PSOL
I think weather related delays are entirely reasonable. If they are shipping via plane, than planes are certainly delayed. Some people I know who are vacationing in Cozumel, Mexico had gotten their vacations cancelled and rerouted to the Bahamas. If they are sending via trucks, I'm sure roads may be flooded or covered w/ debris.
CPE - bbotcs, I have no PM functionality.
If stocks are forward predictors of the future, than maybe the stock price already takes into account the hurricane season. Notice even while Dennis was coming in the stock barely budged and surged once no damage was evident. Dennis was borderline Cat5 storm. Hurricane season starts in June and ends in November, so I've got some time to be proved wrong...
Actually main reason I'm holding onto CPE is because it is one of my larger marginable positions. It is part of my equity base that allows me to short IFIN (custody bank). Earnings report should be out tomorrow night. Right or wrong I may be liquidating some so I can add more to some VPHM. I have to thank MSGI for this one. Though I was slow to react, I have averaged in around 6.
This is the most I've ever posted here. Maybe I can contribute a few winners in the near future.
Banks - I would agree if it was solely a deposit taking institution w/ out more diversified asset management or investment banking opportunities. Citigroup may get hit a little on the retail side, but a regional deposit taking institution is probably worse off.
CPE - nice move today. A lot of you may have given up on this one, but it's moved nicely in the last month. Holding through hurricane season could be a bit of a gamble...
This is from the WSJ... I thought the figure of people borrowing more than 80% was interesting...
GETTING GOING
By JONATHAN CLEMENTS
All Real-Estate Meltdowns Are Local:
Sidestepping the Five Biggest Risks
July 13, 2005; Page D1
You can't go wrong with real estate.
Yeah, right.
I doubt we will see a nationwide real-estate meltdown. But who needs a meltdown? All it takes is weakness in some local markets, combined with a little personal misfortune, and things could get ugly for some homeowners.
Want to make sure your home doesn't turn into a house of horrors? Here are the five key risks in today's overheated housing market -- and how you can protect yourself.
• Borrowing heavily. Tell your friends you are buying stocks with borrowed money, and they will look at you like you're crazy. Tell them you purchased a $500,000 home with 5% or 10% down, and you will be showered with congratulations.
SMR Research calculates that, among home buyers who took out a mortgage in 2003, 61.4% borrowed more than 80% of the purchase price, sometimes taking out two separate loans. By the first half of 2004, the latest figure available, that number was up to 70.6% -- and today it is likely even higher.
STREET SIGNS
How hot is the real-estate market? Here are three indicators:
Home prices in California, Rhode Island and Washington, D.C., have doubled in five years.
In 2005's first three months, just 10% of refinancings resulted in a smaller loan balance.
The total value of real estate rose 73% in five years -- but total mortgage debt jumped 65%.
Sources: Federal Reserve, Freddie Mac
"If we hit a spot where home prices cease rising or rise at a slower place, the high loan-to-value people will remain high loan-to-value," says Stuart Feldstein, president of SMR, a financial-services market-research firm in Hackettstown, N.J. "That tends to correlate with a high rate of defaults."
Today's leverage is especially worrisome given the steep rise in property prices over the past five years. If prices turn lower, those who made modest down payments could see their home equity wiped out, and might even be underwater.
The good news is, even if falling prices obliterate your equity, your mortgage lender can't insist that you immediately repay your loan. The bad news is, you may have to repay the loan anyway, because you have to relocate.
• Bad move. According to the National Association of Realtors, homeowners typically sell after six years. If you're buying in today's hottest markets, plan on staying put for at least that long, so you can ride out any market dips and build up some equity with your monthly mortgage payments.
What if you suddenly have to move -- and prices have stagnated since your purchase? If you had borrowed 95% initially, you could walk away with next to nothing once you figure in lawyer fees, moving costs and the 5% or 6% selling commission.
To avoid ending up as a renter again, consider making extra principal payments on your current mortgage or building up an emergency reserve, so you have enough money for your next house down payment.
• Problems adjusting. Last year, as folks struggled to afford increasingly expensive homes, 35% opted for various types of adjustable-rate mortgages. That compares with 18% in 2003, according to the Federal Housing Finance Board in Washington. ARMs offer a lower initial rate than traditional fixed-rate loans.
Now, however, these borrowers face rising monthly payments as short-term interest rates climb and their mortgage's low "introductory" rate disappears. Homeowners with interest-only mortgages face an additional hit, as their mortgage's interest-only period ends and accelerated principal payments kick in.
Indeed, even if interest rates stay fairly low, some borrowers could find themselves in a nasty financial squeeze. Suppose you took out a $300,000, 30-year "hybrid" mortgage for which the rate is fixed at 5% for the first five years but adjusts thereafter.
Your initial monthly payment would be $1,610. But in the sixth year, your rate leaps to 8%. Result: Your monthly payment would soar 32% to $2,126, according to the adjustable-rate mortgage calculator at www.dinkytown.net.
"You should take a look at a plausible scenario and see whether you can afford it," advises Keith Gumbinger, a vice president at HSH Associates, a mortgage-information provider in Pompton Plains, N.J. "Borrowers who have stretched themselves to the outer limits could be at risk. Adding a few hundred dollars to their monthly payment could be a deal breaker."
• Squeeze play. The deal breaker won't necessarily come from rising mortgage payments. If your mortgage is consuming much of your paycheck, your finances could unravel if, say, you get hit with big medical bills or you lose your job.
If you're barely managing to pay the mortgage now, you clearly don't have the cash to build up an emergency reserve. But you need some plan for dealing with financial setbacks, whether it's borrowing from your brother-in-law, tapping a home-equity line of credit, or even trading down to a cheaper house.
• Inspector remorse. You likely have a huge chunk of your wealth riding on your home. That's a risky position to be in, partly because you are making a big bet on one local market.
But even if you live in a buoyant market, you could lose money on your home, thanks to termite damage, a leaking underground oil tank or major structural problems. That's a real danger in the hottest markets, where buyers -- anxious to win bidding wars -- are making offers that aren't contingent on a home inspection.
Skipping the inspection is totally nuts. If necessary, ask the seller if you can have the house inspected before you bid. Sure, you might waste $400 or $500 inspecting a property you don't buy. But that's better than ending up with a $500,000 lemon.
Lentinman, thanks for the invite to the Pick 6. I unfortunately won't be able to contribute this time around, but maybe the next one. I'll be taking a week or two off this summer so besides playing golf, I'll be trolling for some investment opps. I barely have time to keep updated on my portfolio and the various boards with my job and life commitments. How do you all do it?
Are you guys primarily long players or do some of you short to hedge systematic risk?
I like to have some short positions on just in case the whole market tanks.
I'm about 95% long and 30% short so net long 65%.
Here is an interesting NYT article. Note the 2007 date when $1 trillion of mortgages will be floating.
June 16, 2005
The Trillion-Dollar Bet
By DAVID LEONHARDT and MOTOKO RICH
American homeowners have made a trillion-dollar bet that mortgage rates will remain near record lows for at least a few more years. But with some interest rates already rising, economists worry that the bet could turn bad.
The problem is that new types of mortgages that hold down monthly payments for families - helping many buy homes that they would not otherwise be able to afford - also require potentially far higher payments in future years.
The bill will soon start to come due in a serious way, as the initial period of fixed payments, typically set at artificially low rates, expires for millions of homeowners with adjustable-rate mortgages.
This year, only about $80 billion, or 1 percent, of mortgage debt will switch to an adjustable rate based largely on prevailing interest rates, according to an analysis by Deutsche Bank in New York. Next year, some $300 billion of mortgage debt will be similarly adjusted.
But in 2007, the portion will soar, with $1 trillion of the nation's mortgage debt - or about 12 percent of it - switching to adjustable payments, according to the analysis.
The 2007 adjustments will almost certainly be the largest such turnover that has ever occurred.
The impact is not likely to derail the economy on its own, economists predict, but it will probably slow growth. For individual families, the problems could be significant.
"I'm not sure that people are being counseled on really how big of a risk they are taking," said Amy Crews Cutts, deputy chief economist at Freddie Mac, the mortgage company.
Consider a typical $300,000 interest-only mortgage with fixed payments for the first five years.
The homeowner would start by paying about $1,250 a month. If interest rates rise modestly over the next few years, as many forecasters expect, the payment will jump to almost $2,100 in 2010, according to Stephen Barrett, the owner of Redmond Financial, a mortgage business near Seattle.
With the help of new computer models, lenders have brought out newer and riskier mortgages to attract borrowers and increase their buying power during the long housing boom. The traditional 30-year mortgage with guaranteed payments is increasingly a loan of the past.
The hot loan of 2004 - the interest-only mortgage - allowed home buyers to pay no principal for the first few years of the loan, substantially lowering their initial payments.
It has remained popular this year, accounting for at least 40 percent of purchase loans over $360,000 in areas with fast-rising home prices, like San Diego, Washington, Seattle, Reno, Atlanta and much of Northern California, according to LoanPerformance, a mortgage data firm.
This year's fashionable model, known as an "option ARM," allows borrowers to make payments with monthly rates starting as low as 1.25 percent for the first five years of the loan; the average rate on a 30-year, fixed-rate loan is about 5.6 percent.
During the first quarter of 2005, 40 percent of mortgages over $360,000 issued to people with good credit were option ARM's, said David Liu, a mortgage strategy analyst with UBS in New York. Very few borrowers used option ARM's before 2003.
Many borrowers stand to benefit from these creative loans. On option ARM's, buyers with variable incomes, like the self-employed, can also make smaller or larger payments depending on their take-home pay in a particular month, without incurring penalties. With the average homeowner moving every six years, any loan with lower initial payments can substantially reduce housing costs.
"As a rule, I would prefer the 30-year fixed mortgage," said Alejandro Brown, 31, a technical trainer for Nissan, the automaker, who refinanced the mortgage on his 1,700-square-foot house in Auburn, Wash., with an adjustable-rate loan last year, reducing his monthly payments. But, he said, "I knew I wasn't going to be in my house more than three years; I was very confident."
All of these loans come with the risk of a spike in payments sometime in the future. In particular, borrowers who have taken out an interest-only loan will see a jump in payments simply because they will start to owe principal after the interest-only period lapses. If rates rise, the payments will go even higher.
Borrowers whose incomes have not risen enough or who have not planned for the higher payments could find themselves shocked.
"The apparent froth in housing markets may have spilled over into mortgage markets," Alan Greenspan, the Federal Reserve chairman, said while testifying to Congress last week. "The dramatic increase in the prevalence of interest-only loans, as well as the introduction of other relatively exotic forms of adjustable-rate mortgages, are developments of particular concern."
The lure of such loans is obvious. Because of the lower initial payments, buyers can purchase bigger and more expensive houses.
With her daughter leaving for college this summer, Linda Thompson decided to sell her four-bedroom house in the Seattle suburbs and move to a town house in the city's Lake Union neighborhood. But prices were so high that she had to go beyond her "level of comfort," she said, and spend $619,000.
She signed an interest-only mortgage that cut her monthly payments by about $500 compared with a conventional mortgage. Seven years from now, the bill will rise as she starts paying principal, and the size of the increase will be determined by interest rates at the time. But she may have moved by then, she said. And because the house is in an up-and-coming neighborhood, she expects the value to rise.
"The risk factor - of course it's always there," Ms. Thompson, 49, who runs a small marketing company, said as she was preparing to watch her daughter graduate from high school yesterday. "But to me, real estate is a better investment than the stock market."
"Just sitting there," she said of her new house, "it's appreciating right now."
Still, even some mortgage brokers are concerned by how much their clients are stretching their spending power using creative mortgages.
One possible warning sign is that a growing share of those taking out the aggressive loans is made up of lower-income families living in expensive areas, according to Economy.com, a research company. Another is that variable-rate mortgages have stayed popular even as long-term, fixed rates have gone down and rates on adjustable mortgages have risen.
"There are people who are buying homes that they shouldn't buy," said Eric Appelbaum, president of the Apple Mortgage Corporation in Manhattan. "People are saying, I can afford it on interest-only but I can't afford it" with a traditional mortgage, Mr. Appelbaum said. "It doesn't make any sense."
Since borrowers with interest-only mortgages are not yet paying down their debt, they are hoping to build up equity through an increase in home values. If house prices fall, as they did during the early 90's in some cities, borrowers will be forced to bring money to the table when they sell.
Even if home prices rise a little, borrowers who have taken out option ARM's and made only minimum payments for five years could find themselves in a hole. Such loans, which are typically based on rates that adjust monthly, give homeowners four payment options each month. In the first quarter of 2005, 70 percent of option ARM borrowers made the minimum payment, according to UBS.
In doing so, those borrowers effectively added more debt to the back of their loans.
On a $400,000 loan, for example, a buyer who made only minimum payments over the first five years would add more than $27,000 to the end of the loan, assuming short-term rates increase by one percentage point over the course of the loan, said Robert Binette, a mortgage broker with Hamilton Mortgage in Ridgefield, Conn. The monthly payment would jump from $1,718 in the final month of the fifth year to $2,580 after the loan was reset, a difference of more than 50 percent.
Borrowers who expect to cover the larger debt by refinancing could be in trouble if rates have increased. Thirty-year fixed-mortgage rates are near their lowest level in a generation.
Nationwide, the increase in monthly payments as more mortgage rates start to float will cost families about an extra $40 billion over the next two years, according to estimates by Credit Suisse First Boston. That is the rough equivalent of a 40-cent increase in gas prices over the same span, which would pinch incomes but would not be likely to create a recession.
The biggest concern, many economists say, is that the new mortgages have come onto the market at a time when low interest rates and rapidly rising home prices are the only reality many people can imagine. Families might be making decisions assuming that combination will last forever.
In a speech to bankers in New York, Donald L. Kohn, a Federal Reserve governor, said yesterday that he expected a strong economy over the next few years.
"My message this morning, however, is that this is not a time for complacency," he said.
There is "significant uncertainty," he added, because some recent financial innovations "have not yet been rigorously stress-tested."
http://www.epriweb.com/public/000000000001011264.pdf
This link provides some background info. on BPL and mentions Ambient.
Thanks - markrhead. Any good places to research the commodities markets?
I saw kitcometals.com on the board description, but looking for other websites to research o&g and agricultural commodities. Thanks for the info.
Trying to expand my base beyond value microcaps.
Can anyone recommend a good online futures broker?
BRST.PK - Here's some more info from Investorshub.com
http://www.investorshub.com/boards/board.asp?board_id=1979
Pending settlement w/ MSFT. Why would MSFT settle? They must know their goose is cooked. Hoping for a good outcome over the next week.
Something I should have posted when I bought in early this week. Though there is still some upside due to the outcome of the settlement with Microsoft. They just put out a memo stating that there is a pending settlement on an anti-trust case w/ Burst. The price today implies approx. $250mm settlement.
I was busy buying some additional shares in the run-up, but stopped after 3.25. Price seems to have settled in after a spike close to $4.00. Still might be worth a flyer if the settlement amount is greater than $250mm and the company begins receiving license fees.
http://biz.yahoo.com/iw/050310/082479.html
I think this is bigger news...
Rollout through Westchester NY for BPL marketed by Earthlink. While not officially announced, the fact they have a website up means that the technology is getting closer to commercialization. Too bad I don't live there, otherwise I would be testing it out myself.
http://www.earthlinkconed.net/technology.html
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Filters - premium feature just like ignore.
Taken straight from the FAQ...
"This section is where you manage your filters/ignores. To ignore someone, make sure you have Filters Enabled. Go to their profile and click 'Hide this Poster' -- they will show up on this page and stay filtered unless you turn off filters or 'Unhide' them. You can also block a person from sending you private messages by clicking 'Block Messages from [poster]' (in the blue bar) when you are reading a private message from them. You can 'unblock' them from the My Filters page. Another feature is the 'Replies To Filtered People Also Filtered.' This blocks the replies to the posters you have filtered, effectively hiding any discussion involving the people you have filtered. "
Guy, thank you - Smoothing earnings...
The hardest part about small cap stocks is to smooth earnings to find what are consistent recurring earnings. Taking out seasonality and one time charges/gains is all part of being a good analyst.
I like this board and look forward to contributing, but from a pure value point PE is not always the best measure of value. It is only one measure of value.
Keeping some dry powder, just in case. EOM.
Probably overall market reaction to neg. view placed by the Fed in lack of adversity to risk. Meaning the low rate environment that has been in place for the past several years is causing some asset bubbles, this may be a signal of increasing pressures to keep rates high to fend off inflation. Various areas of the markets are selling off, not just our microcaps.