Investing in PartyPoker Shares

[alexoi]

Hey Guys,
What do you think about buying PP shares, they are down right now, and maybe some of you financial experts could tell me what shares you would suggest me to buy, or how you would suggest me to invest my money ?

Thanks for all your help, Alex

[UncleCollins]

Do not invest in PP. Their shares are down for a reason and they are not going back up anytime soon.

[SlowHabit]

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Do not invest in PP. Their shares are down for a reason and they are not going back up anytime soon.

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I don't think this is a legitimate argument to not buy PP shares since EVERY stock is down for a reason. The question is "what is the reason PP is down" and what are the chances of this reason being solved in the near future.

And how do you know if they are not going up any time soon (and how long is exactly is "any time soon" since it is so subjective)? What if the foreign markets (Asian, Europe) are better than expected? What if there's an bill/admenment that allows institutions to transact gambling funds within the next two years? What if the Justice Department can't figure out an efficient way to force banks to regulate this new law?

On that note: Since there's too many "what ifs" that can't be answered correctly, don't buy PP.

[john kane]

i just bought $4K's worth at 27.25p. It sucked they carried on going down to 26p, but i think, as a long term investment, its worth a pop.

Why?

Well, will they go down much more? No, imo, becuase they have a very simple profit system, which wont change, and market price reflects their earnings pretty well imo.

Will this earnings increase over time? Of course, yes. they will expand into more countries and they profits will increase.

The risks simply arent their imo. They got out of the US, tey wont go under - they make way too much money, and the future looks fine in the countries they are currently in. I think the foundations they have laid have made their reputation too strong to simply get an worse than the already are.

They went down a 10% odd today due to traders getting leaked reports that thursdays statement wont be great. but im not buying this for the next few weeks, im in it for the long haul.

[SlowHabit]

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Well, will they go down much more? No, imo, becuase they have a very simple profit system, which wont change, and market price reflects their earnings pretty well imo.

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Can you write in complete sentences of the above opinions because I'm having a hard time figuring out what you're trying to say? (I mean it in a good-hearted manner, not as an insult).

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Will this earnings increase over time? Of course, yes. they will expand into more countries and they profits will increase.

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You do not know for sure if their earnings will increase or not. Other countries are not as rich as the USA. Other countries do not have people who have money to gamble with. Other countries do not have financial aids for college students to gamble with.

You also have to realize that the European customers have their own poker websites already. Party Poker got 80% of the profits from Americans, which means, in order for Party Poker to be as profitable as before, they have overtake almost, if not all, of the existing European poker websites.

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The risks simply arent their imo. They got out of the US, tey wont go under - they make way too much money, and the future looks fine in the countries they are currently in. I think the foundations they have laid have made their reputation too strong to simply get an worse than the already are.

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How do you know this? What concrete evidence do you have?

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They went down a 10% odd today due to traders getting leaked reports that thursdays statement wont be great. but im not buying this for the next few weeks, im in it for the long haul.

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I hope you enjoy the ride [img]/images/graemlins/cool.gif[/img]

[john kane]

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Well, will they go down much more? No, imo, becuase they have a very simple profit system, which wont change, and market price reflects their earnings pretty well imo.

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Can you write in complete sentences of the above opinions because I'm having a hard time figuring out what you're trying to say? (I mean it in a good-hearted manner, not as an insult).

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Sorry, i was in a rush. My general point is that ever day they are churning out profit in a very simple manner - people log on, play poker, they make money.

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Will this earnings increase over time? Of course, yes. they will expand into more countries and they profits will increase.

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You do not know for sure if their earnings will increase or not. Other countries are not as rich as the USA. Other countries do not have people who have money to gamble with. Other countries do not have financial aids for college students to gamble with.

You also have to realize that the European customers have their own poker websites already. Party Poker got 80% of the profits from Americans, which means, in order for Party Poker to be as profitable as before, they have overtake almost, if not all, of the existing European poker websites.

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a) Indeed i don't know earnings will increase, but like 99% of trading decisions, i am speculating.

b) Many other countries have money to gamble with. almost all of europe, asia, australasia.

c) Indeed the figure is around 80%. The IPO was around 120p which shot up. It is now at 27p. 27/120 is 77.5%. So for it's share price to drop 77.5% due to losing 80% of its customers is a fair reflection. All it now needs to do is increase the number of customers. I think they will do this, given previously they focused most of their efforts on the US = lots of US players, now they will focus elsewhere = hopefully lots of new players. It wont be as big as before, but that is irrelevant, if they can double their current revenue in the next year or two i think there share price will reflect this and go up to around 45p.

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The risks simply arent their imo. They got out of the US, tey wont go under - they make way too much money, and the future looks fine in the countries they are currently in. I think the foundations they have laid have made their reputation too strong to simply get an worse than the already are.

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How do you know this? What concrete evidence do you have?

Again I don't know, I am just making a judgement. If we all had concrete evidence then it would all be a lot easier. Take the entire commodities market for small stocks when drilling for gas etc.

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They went down a 10% odd today due to traders getting leaked reports that thursdays statement wont be great. but im not buying this for the next few weeks, im in it for the long haul.

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I hope you enjoy the ride [img]/images/graemlins/cool.gif[/img]

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I may be completely wrong, yes it is a pretty big gamble, but hopefully come end of 2007 they will have more players = higher share price.

[tomdemaine]

Buying PP shares is a big gamble especially since they cancelled their dividend but if at any time in the next 1-2 years they find a way to reenter the US market you'll really hit the jackpot IMO.

[stinkypete]

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Buying PP shares is a big gamble especially since they cancelled their dividend

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are you serious? would it be any less of a gamble if they hadn't cancelled it?

[SlowHabit]

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Buying PP shares is a big gamble especially since they cancelled their dividend

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are you serious? would it be any less of a gamble if they hadn't cancelled it?

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PP cancelling its dividends basically mean "our cash flow isn't as good as before and we do not know when we will have a lot of cash again."

If PP gives out dividends, at least it seems like they *have* a plan on how to make up for the market share lost in the US and that they still have a lot of cash in reserve in case a bad beat (or bad beats) occurs.

Basically, PP stopped paying dividends = not a very good idea to insure shareholders (especially after the anti-gambling bill) that everything is going to be ok.

Come to think of it, PP is like M$. Create a brand that legally monopolize its market and barely improve its product over the years while raking (pun not intended) in a lot of cash.

[stinkypete]

so what you meant to say is

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Buying PP shares is a big gamble especially since they are busto, as evidenced by the cancelling of their dividend

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