Picked up some more Disney today. They increased their dividend last week. Jessica reiterated her buy, on the Merrill US 1 list, yesterday and the market is getting walloped. Good time to buy the King of Content in media.
Tagged the 50 day 3x. Good enough. At resistance here for traders at 3.51 so it should find considerable volume.
Still figure the only strong buyer is SIRI itself. People keep selling. (please do!)
One thing to keep in the back of your mind is that LMCA is mid buyback too. You have two stocks that hold hands, both in buybacks...
Remember this when / if LMCA offers an equity swap at a 5 to 10% premium. LMCA here is actually undervalued as well as SIRI. Post swap, if done right and at the right time, could translate into quite an explosive move for SIRI (as LMCA) on combination.
That's what I am waiting for, at least. The longer this drags here and thus the longer LMCA drags, and the more each can buy back at minimal valuation areas, the better the move later. I have no idea if that will be before a swap offer, after... or even when that may come though. One of the reasons I don't look to trade my position here. My luck, I'd be sitting in cash and have to chase it in. Just adding dips to the 50. Bought my monthly amount today. Bad move short term? Who cares... this shit is cheap here especially looking down the line.
As an explanation, it's all a numbers thing, really. I am sure I could draw up an equation given enough thought to plot some sort of graph explaining my thoughts here but it should be somewhat apparent what I am getting at.
You have SIRI (X) and LMCA (Y) with LMCA being mostly SIRI. Thus Y = X * ####
Assuming X stays low, Y must stay low. If you can control X, then, you control Y.
If over time you are decreasing BOTH Y and X through buybacks you are actually increasing Y faster than if the buyback was only on one side of the equation.... the thing is if Y does not guide X and only X guides Y, then you start to have a huge imbalance on the Y side.... Y becomes undervalued compared to X.
This means a premium of 5% last year offered by Y for X had a relative valuation that would be less than a premium offered of 5% this year by Y for X... it may be equivalent to if 7% had been offered previously. Institutional investors... the ones that matter, should understand this concept.
Thus if, say, 10% is offered, the premium may be akin to 14% last year.
Retail will be friggin' stupid again. It will look at the premium in terms of share price and go boooo hisss nooooo.... But if retail is 10% or less retail doesn't mean shit and can take the boo and the hiss and stick it up its ass. The retail vote may have mattered at 25% in line with institutions but if the balance is now institutions 4 to 1? Let the smart guys say "yes" and just go along with it.
So the offer may look like $4 or something while the stock sits at $3.75, and people may not "like" that but all that matters is future valuation prospects of LMCA after the swap and nothing more (assuming it's not a cash offer, in which case if it is then I would highly suggest selling SIRI on confirmation of a "yes" and buying LMCA in one fell swoop, and then hold what would be the new SIRI).
See what tomorrow brings for the market... all these chuckleheads talking end of the world and market is going to crash on every pull back, still. people been saying it for years... I think we're more likely to have another 5 years of prosperity rather than some drastic pullback but that's just me.... :P
RE: Where would LMCA get the cash to buy out the rest of SIRI?
Margin loan against current SIRI holdings. Cheap right now... It would be tight but I believe SIRI CF which would become LMCA CF could cover the debt. This starts getting into areas I do not yet fully understand, thoughBut it does seem reasonable given that LMCA can and has used exisiting SIRI holdings as collateral recently.
Huge drop in short interest....
http://www.nasdaq.com/symbol/siri/short-interest
11/14/14 - 247 million
11/28/14 - 163 million
Last edited by dm_4; 12-09-2014 at 08:39 PM.
80 mil shares. Could have been due to the other ASR...? I don't know why but 80 mil shares is setting off alarms in my head?
Had to be tied to something. Volume between the two points is not sufficient to cover 80 mil short shares on the trade dates (3 days prior to settlement).
Dig dig dig...
LMCA held shares from bonds as expected.
Don't think others need to report as there are no other 5%+ owners.
Now comes a Form 4....liberty aquired more shares???
http://investor.sirius.com/secfiling...743&CIK=908937
convert related.
Last edited by dm_4; 12-09-2014 at 09:07 PM.
Faulkner...Thanks for your insights, analysis and time involved to lay out your hypothesis....very much appreciated.
DM, thanks for links and input....very much appreciated as well.....GL to the longs>>it -EDIT -
ALLTHEBULLSHIT - will pay off for our patience.....hopefully soon
Last edited by denco1; 12-09-2014 at 09:16 PM.
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