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Thread: SIRI is trading on a range... Need opinion.

  1. #1
    Siriusowner is offline
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    SIRI is trading on a range... Need opinion.

    I was looking at several charts and I came to the conclusion that SIRI may have found a bottom. In other words, it is no longer in a pronounced down trend.

    If you look at SIRI's 100 day chart, you will see that for the last 17 to 18 trading days or so, it has been basically trading in a range with its lowest around .14 and its highest at around .25. So it has been on a range and I think it has found good support and resistance. In other words, it will be "safe" to buy at .14 or a little bit above and sell at .25 or little bit below BEFORE the shareholder meeting.

    With the economy as it is, in recession, SIRI needs a catalyst to break out of range. I think that catalyst will come from the shareholder meeting. Good news and the stock will break to the up side, bad news and it may break to the down side.

    What is everyone's opinion ? Will SIRI break to the up side or to the down side ?

  2. #2
    Newman is offline
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    I think it may break to the up side... I know, you are real surprised, but hear me out.

    Everything is about financing. People do not (really) care about dilution, because they have seen it coming for over a month now. It is baked it.

    People will see that the company now has access (That does NOT mean the shares WILL be released, just that they have access) to all of these new shares, which means the company has options. They can sell more shares (direct dilution) to get money to pay down debt, or they can do convertible bonds (indirect dilution) to get money or the combination of the two. Once the people know they have options, then the stock will start to rise, because right now it is priced for BK.

    Still don't know about the RS, and personally I voted against it. (voted for the shares though).

  3. #3
    Siriusowner is offline
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    Quote Originally Posted by Newman View Post
    I think it may break to the up side... I know, you are real surprised, but hear me out.

    Everything is about financing. People do not (really) care about dilution, because they have seen it coming for over a month now. It is baked it.

    People will see that the company now has access (That does NOT mean the shares WILL be released, just that they have access) to all of these new shares, which means the company has options. They can sell more shares (direct dilution) to get money to pay down debt, or they can do convertible bonds (indirect dilution) to get money or the combination of the two. Once the people know they have options, then the stock will start to rise, because right now it is priced for BK.

    Still don't know about the RS, and personally I voted against it. (voted for the shares though).

    I can see that happening if they would announce at the meeting that they would do convertible bonds instead of selling more shares.

    I am up against more debt and bonds will still dilute equity BUT it offers the advantage of reduced interest payments and they can still control the ratio of dilution.

    In any case, the debt maturing in FEB is a big issue and I think that no announcement, the approval of further equity dilution or even the approval of the RS at the shareholders meeting will be the catalyst that SIRI needs to break to the down side (I agree the stock is priced for BK but it can still break further to the down side... just look at Lehman and Circuit, at one point they traded at .05).

    On the other hand, the announcement of a refinance of the debt maturing in FEB or a change in strategy, like issuing convertibles to pay for the FEB debt while keeping the 360 BIL cash instead of issuing more shares, could be the catalyst that SIRI needs to break to the up side...

    Like you, I am against the RS. Hopefully NASDAQ will extend the exception to the 1 Billion cap rule...
    Last edited by Siriusowner; 12-02-2008 at 05:15 PM.

  4. #4
    m4svt is offline
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    look at the bullish divergence on the dow. when the dow pops, you pop.

  5. #5
    Siriusowner is offline
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    Quote Originally Posted by m4svt View Post
    look at the bullish divergence on the dow. when the dow pops, you pop.
    Not necessarly, for a couple of reasons:

    1.- The DOW is an index of 30 blue chips only.

    2.- The S&P 500 is a broader indicator. They seem to move in tandem BUT the S&P lags the DOW.

    3.- If I am long SIRI, I would follow the NASDAQ composite closer.

    4.- The divergence is only one indicator, need 2 more for confirmation.

    5.- MOST important, these days you need to analize the fundamentals also if you want to trade succesfully.

  6. #6
    Newman is offline
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    Siriusowner: I believe you meant to say 360 MILLION, not BIL about the cash on hand...

    The February debt has never been a concern of mine, much like I do not worry about the Mid-year debt (May?). The debt that concerns me is December, but I think the economy will be back in shape by then and financing will come much easier.

    I think the banks may be waiting on the RS or share decision before agreeing to the loan. I would not loan money to a company knowing that they may be delisted within a year. With the RS, that virtually guarantees that they will extend their listing requirements, but I think NASDAQ will do that for them anyways.

  7. #7
    m4svt is offline
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    Quote Originally Posted by Siriusowner View Post
    Not necessarly, for a couple of reasons:

    1.- The DOW is an index of 30 blue chips only.

    2.- The S&P 500 is a broader indicator. They seem to move in tandem BUT the S&P lags the DOW.

    3.- If I am long SIRI, I would follow the NASDAQ composite closer.

    4.- The divergence is only one indicator, need 2 more for confirmation.

    5.- MOST important, these days you need to analize the fundamentals also if you want to trade succesfully.
    Well the nasdaq, s&p and dow show the same divergence. The MACD is positive, still. I'm sure a lot of technicals are positive but i'm too lazy to look deeper. A lot of people just see the fear in the market, all I see is opportunity.

    I've added a lot of shares of this POS lately, but I've also added a lot of boring dividend stocks to be on the safe side. It's a buyers market folks, take advantage while we still have fire sale prices.

  8. #8
    Siriusowner is offline
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    Quote Originally Posted by m4svt View Post
    Well the nasdaq, s&p and dow show the same divergence. The MACD is positive, still. I'm sure a lot of technicals are positive but i'm too lazy to look deeper. A lot of people just see the fear in the market, all I see is opportunity.

    I've added a lot of shares of this POS lately, but I've also added a lot of boring dividend stocks to be on the safe side. It's a buyers market folks, take advantage while we still have fire sale prices.
    If you are a trader yes, there are opportunities. If you are an investor, you have to be more cautious. Adding to a risky position because is cheap is not an opportunity...
    Last edited by Siriusowner; 12-03-2008 at 10:23 AM.

  9. #9
    APEXSPORTS is offline
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    SIRIUS XM ISNT A DAYTRADING STOCK.. we have a bottom for sure .14-.15

    I am waiting on proxy meeting as mel will speak and we find out about dillution state of refinance etc..

    I think the week of proxy we drop hard as people will dump on worries and rally after(if we dont dillute).. so you can wait till then to buy more etc. thats my plan.

    we are trading aroung the gm/f bailout and if you notice we dont rally when market does etc.

    peace

  10. #10
    m4svt is offline
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    if the auto makers get bailed, the debt gets refid SIRI will jump. It really wasnt too long ago it was $2.00.

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