Covered Calls

[Joe Stocks]

XMSR - The other day a friend asked me about XMSR. One critera for entering a covered calls is that I don't mind owning lower. Sure, if the SIRI/XMSR merger gets approved, XMSR could easy bounce up and you would collect a nice OTM premium plus gain.

I don't want to own XMSR lower. I think the merger creates one of the worst balance sheets I have seen or heard tell of. The only way this merged company will ever be successful is if they file bankruptcy and reorganize with the current shareholders getting nothing. There are simply too many shares issued and much too much debt to ever become profitable or justify a price above a buck a share.

I would not be interested in selling calls on XMSR...never...never ever. lol!

(BTW, I am not passing judgement on satellite radio. My opinion is solely based on the financials.)