Unfortunately SIRI did not see a pop on earnings. Although it's earnings were good (missed by 2 cents on EPS, but had higher than expected revenue. Most important, they raised full year revenue and subscriber guidance) So why didn't we see a jump in the stock?
I hate playing the blame game, because there is no "out" for a bad stock picker, it's always his/her own fault. But let me try my best to explain what happened,
The day before Sirius reported Jim Cramer decided to have his biggest segment on XM Satellite Radio. Jim explained why he believes that XM will get bought out by Sirius. AHHHH!!! We all know that Cramer moves the market, and if you are new to this game, that the buying company goes down in price, while the bought company gets a boost. In all fairness, the very next day when it reported, Cramer talked about how Sirius shouldn't have traded so somber.
I still think his convincing idea that Sirius would buy XM trumped the data. I can't make an educated guess on a buyout, but I will say that XM has a history of stubbornness and Mel Karmazin, CEO of Sirius, has said he is not actively looking to buy XM.
Regardless of what happened in the immediate term, it is August and I plan on holding Sirius through December. As explained in my previous article, the last few months of the year are best for satellite radio. As long as it stays above it's 200DMA on the weekly chart at 3.79, I won't get itchy on the trigger finger.
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Aside from Sirius,
It feels like fun today. Hurricane Chris is getting closer, natural gas is shooting through the roof, and my stocks are doing well. I'll take this chance to go over my current portfolio:
(UNH) UnitedHealth Group- Diversified health care company
(STP) SuntechPower Holdings- Solar power maker in China
(NBR) Nabors Industries - Oil & gas driller
(AMGN) Amgen- Biotech company
(NSRGY) Nestle- Food & beverage company (yes, the chocolatier)
(SIRI) Sirius Satellite Radio- The larger of the duopoly
(DXD) Ultra Short Dow30 Proshares- Previous article explains it
What makes this is a good portfolio?
Based on my belief (and many others) that the stock market will go into a recession, I have concentrated into two types of stocks: (Aside from SIRI, which is tagging along for fun)
Defensive stocks- UNH, AMGN, NSRGY, & DXD
Energy stocks- NBR & STP
These types of stocks should pull their weight no matter how the market plays out.
No trade ideas for today, except to pick up some extra DXD or SDS as the market goes higher these just get cheaper.
Happy Trading!
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