One of the challenges on Wall Street has always been trying to find ways to tip the scales more evenly to allow “the little guy” a chance at reaching some modicum of success.
I have found that the most effective way of bringing balance to the investment community has been through due diligence. While everyone wants to make money, not everyone knows how to conduct research or care enough to take time to do it.
One of the things that have always made TheStreet a success has been the exceptional degree at which it has afforded investors actionable information with pinpoint accuracy. It does this consistently by allowing writers like me to scour large volume of data and organize it in a way that it makes sense and hopefully the end result generates sufficient analysis to help investors make some well-timed investment decisions.
Sometimes, investors listen and other times the information is readily dismissed, but the information has always been there. Case in point:
Mel Karmazin, CEO of Sirius XM Radio sold 17 million more of his options at prices of $1.97 and $1.98. While this may have come as a surprise to many, it really shouldn’t. This was highly expected and one of the reasons for my suggesting this week that $2 would be the new trading top.
Speaking of clock, disappointed investors are quick to point out on my recent articles that “even a broken clock is right twice a day.” However, as we sit here today, Friday, May 18, while investors are wondering what is going on with the stock and anguishing over how long this suffering will continue, here are two broken clock examples on two separate occasions. Last Tuesday, May 8, when the stock was trading at $2.25, I offered the following trading advice:
Also, the CEO, Mel Karmazin, still has 49 million more options to exercise. I wouldn’t be surprised to see more insider selling, including some from Karmazin, between May 16 and 18. With Liberty (Media) not paying more than $2.15, investors would be smart to sell now and move on before the downgrades start flowing in.
Again, on Monday, May 14, when the stock was trading at $2.11 and others were calling for $2.15 being “the new floor,” I offered the following suggestion:
Essentially, Liberty is saying it is not willing to pay more than $2.15 for the stock. If that's the case, why should anyone else? I think the answer to this question will become very apparent in the coming days and weeks. My suspicions tell me one clue will be more insider sales — specifically from CEO Mel Karmazin, who I’m expecting to sell more of his 49 million options at some point this week.
If you are keeping score at home, Karmazin still has 32 million shares left to sell and, like clockwork, investors can expect another 10 million shares to be sold on the market approximately 30 days from now. As I have said recently, there is a great chance that the stock will hit $1.65 within the next several sessions — in other words, this is bound to get worse before it gets better. Investors can protect themselves by utilizing research presented in articles such as these and ask the appropriate questions though they may differ from your own opinions and wishes. This includes getting upset at analysts for making calls that eventually proved to have been right.
The greatest equator on Wall Street has always been information — but more importantly, how to use it. In these two examples above, actionable information was shared to help protect investors from losses. Instead, the focus was placed on the messenger or “the agenda-driven basher.”
Investing is hard as it is, but it comes much easier for those who remain objective and take these articles and opinions for what they are and not what they think the “motive” is. Those who are able to do that tend to perform appreciably better than those who are emotionally tied to their investments.
My goal has always been to inform and educate while utilizing two of the things that I enjoy the most — that is research and writing. While the delivery may not always be appreciated, try instead to focus on the information and not the messenger. In the end, we all will be better off for it because the right questions will be asked and the conversations will be more enjoyable.
—By Richard Saintvilus, Contributor, TheStreet.com
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TheStreet’s editorial policy prohibits staff editors, reporters, and analysts from holding positions in any individual stocks. Disclosure information was unavailable for Richard Saintvilus.