First good idea - Page 6

godofgamblers · #51 08-04-2007, 04:12 PM

I don't know much about stocks nor have I ever purchased any. However this thread feels like one of those inside tips that I see in movies and am interested in investing a bit less than 10k in this. I know this sounds like a horrible idea since I know nothing about market specifics, but it can't be too bad right? If anyone wants to help in directing where to go to get the money in, and how to set up an account online, I'd appreciate a PM a lot.

I figure it can't hurt; if I gain in this I'll gain a huge interest in stocks and finance and delve into it deeper, which can only be good. If I lose I just won't touch this sector again until I learn much more about it, which wouldn't be bad either.

PeterPlan · #52 08-05-2007, 09:08 PM

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However this thread feels like one of those inside tips that I see in movies (...)

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SM:
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The company does not provide guidance. Analysts are all over the place as a result.

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Its not like SM and krishan have been the only ones having a closer look at this company.

Still it would be interesting to hear from them how they evaluate the situation now.

Scorpion Man · #53 08-06-2007, 08:34 PM

Hey guys- sorry been AWOL...dealing with a bleeding portfolio is always fun.

I really don't have a lot to add from previous posts. As far as I am concerned little has changed here from $11 to $8.50. DSUP has an enterprise value at $8.50 of (depending on which seasonal balance sheet you use) around $480m. At $11-12 it had an EV of around $525-535m. This is quite a small difference. Welcome to the world of investing in leveraged companies. I am not recommending people do anything...it's a pressure I don't want to take. I bot more stock around 9.60 or so but I am very full. That's about it for me. I am not even tempted to sell any here...but the stock is very thinly traded and has been in free fall on very very little volume. 40k shrs (some of which is double counted) is probably $300k total of trading. That is what has been taking the stock down 5%+ per day.

If the US economy does not implode, I believe in this idea over the next 12-18 mos, as I have said. They have little residential exposure. It is a negative if the junk mkt never comes around...but, if I am right, their EBITDA will continue to improve on a trailing twelve month basis and this will enable them to refi at satisfactory (certainly better than what they have now) rates.

DSUP is not in trouble. They will be about neutral in cash flow this year, they have room on their line of credit, and they don't have maturities until 2009. The stock is not going to zero.

That's all I got. This is probably the last specific name I will post. I don't like losing my money, but I like losing other people $ even less...I remembered the pump part, I just forgot to dump. Damn.

Badger · #54 08-06-2007, 08:50 PM

I wouldn't feel too bad about losing other people's money. I think the community here knows what they are getting into. If nothing else you've provided a lot of value with your insight. Thanks for taking us through your thought process on this one.

PeterPlan · #55 08-06-2007, 09:33 PM

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I wouldn't feel too bad about losing other people's money. I think the community here knows what they are getting into. If nothing else you've provided a lot of value with your insight. Thanks for taking us through your thought process on this one.

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QFT

craigthedeac · #56 08-07-2007, 02:44 PM

ditto

Scorpion Man · #57 08-11-2007, 12:27 PM

Hey, guys. Quick update here. As you know, the action in DSUP has seemed extreme to me (for example it opened down 8% on no volume on friday on no news despite being hammered repeatedly before that).

I am writing because I now understand the likely reason. You have been reading about it in the paper. Some major quant funds have been in heavy turmoil. Goldman Sachs, a top 3 DSUP shareholder, is among them. (Goldman is also a major CHTR holder). The tenor of the decline and discussion I have had with a quant fund manager lead to believe that this was an important contributor to the way the stock has been acting. People believe that the quant fund liquidation has mostly run its course (although DSUP is quite illiquid and who knows...but it finally traded a lot of volume on Thursday and Friday, which is a good sign. It had been going down on very little volume before that.

DSUP's success or failure will be predicated on their results between now and the end of next year. In the end, the current price movements won't matter. It will be interesting to get a prologue on this.

hlacheen · #58 08-11-2007, 05:18 PM

Interesting company but too leveraged for my taste.

Jeffmet3 · #59 08-11-2007, 08:13 PM

so you're saying that the decreace in the stock price has been a result of GS and others quant funds liquidating their shares as a result of unrelated problems?

thus with the company's true value and outlook unchanged, it would make DSUP and CHTR look very cheap at the moment?

thanks,
jeff

Scorpion Man · #60 08-11-2007, 10:02 PM

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so you're saying that the decreace in the stock price has been a result of GS and others quant funds liquidating their shares as a result of unrelated problems?

thus with the company's true value and outlook unchanged, it would make DSUP and CHTR look very cheap at the moment?

thanks,
jeff

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Not really. For starters, CHTR is a very speculative buy and acts almost like an option...I think there is also some fear that High Speed Data growth is slowing - adds were not good in the second quarter. The difference in valuation on CHTR between $2 and $4 per share is pretty much irrelevant...that is why the stock can move around so fast.

On DSUP, what you say is closer to the truth. That said, the crappy high yield market, if it stays that way, does take out some of the upside...but for me it was taking $2-3 per share upside out of a $20+ stock price in terms of my original thinking. In terms of "true value" and "outlook" being unchanged...well, that is always the big question. It is always possible that the outlook is deteriorating and I don't have visibility into it. If the credit crunch were to roll over into a serious commercial real estate problem, for example, that would change things. I don't think that will happen because we had a huge downturn already in 2003 and vacancies are dropping right now -- but it is possible.

I am making more of a trading point here...that these stock price movements were a combo of fear of credit issues (i think that is an overdone point for DSUP and maybe worth a couple bucks in short term price action - but not $6) and non fundamentally related trading issues. We cannot ignore, however, that they missed estimates in Q2. The key question is whether they make it up in the second half, as they are intimating.