PhotoChannel Moves to Australia

Yesterday, PNIWF announced the COSTCO service had started. So, why wasn’t this market moving? Simple- because everyone already knew it- no surprise there.

Today, PNWIF announced it had entered into a deal with Kodak to expand online photo processing into Australia. This is news. I didn’t know about it.

One would think this is market moving news, but clearly the audience for this stock is not quite paying attention.

They have been kind of dropping the ball on shareholder awareness. Not much has been coming out of PNWIF of late.

Boys- time to ramp up the information flow. Get this darn stock north of $4, jump to NASDAQ SC, and let’s rock from there.

I don’t have time to provide a chart right now, but comments and questions are welcome. This one could be big winner in the second half of 2008 and well into 2009 and beyond.

Daily Musings from Larry Isen: 4/30- 7:30 AM Pacific

Sorry for the tardiness of this update. Yesterday I was in the air all day on long suffering Delta, and am firmly planted in wonderful Manhattan this AM. For those with questions in the BLOG- I got to them this morning.

I won’t be commenting on today’s market action until tomorrow as I will be in an all day meeting. Too bad- it’s a big day for potential progress.

Yesterday was another lackluster day as the market is pausing for the FED moves today. The market is expecting a one and done 1/4 point cut. Of far more importance is the statement- I continue to believe if the FED turns a bit hawkish on inflation in the statement, the market will love it.

Credit spreads are sabotaging the FEDs efforts. AAA mortgage portfolios have not found a bid, and Libor is stubbornly staying high against the short term fed funds rate- this means mortgage and credit card rates are not dropping in conjunction with the FED’s efforts.

There is an appetite for financials at the right price. Last night, Citibank did a new issue of convertible preferred- they were looking to raise $3 billion- due to demand Citi raised $4.5 billion. Since Jan 1, CITI has raised a total of $40.5 billion. That’s a staggering number, and shows there is capital available to replace the losses on mortgages.

In our small stock land, CREE is giving some ground, SPKL is very quiet, EFSF has given a little ground which in the past has been a buying opportunity. VTOK has crept up a couple of pennies of late. NIHK all quiet. TTGL and CPNE are both probably done for.

Of special note is a little long awaited news out of PhotoChannel. PNWIF announced the Costco service has started. Today, they announced they will be rolling out their service in conjunction Kodak throughout Australia.

Costco was no surprise, but Australia was. Let’s see if the stock can find a bid on this news.

The dollar has been firming slightly as the market expects the FED to be done easing. This should help commodities ease as the dollar firms, and be good for us all. The weak dollar has helped the big multinational companies, but it’s now gone to far and the price off commodities is killing the economy. This needs to change.

Let’s hope for a hawkish statement on inflation out of the FED today. I believe that is what the market is looking for.

Musings Of Larry Isen On Today’s Action: 4/28, 1:46 Pacific

All quiet in the markets today out in front of the FED’s open market committee meeting tomorrow.

The market is pricing in a 1/4 point rate drop. I don’t believe it’s a mark moving event.

However, I do believe the statement is a market moving event. If the FED indicates they are close to the end of the interest rate lowering cycle, the markets will respond positively- if the FED makes an announcement indicating it is going to remain vigilant on economic stimulus, and isn’t too worried about inflation, the market will hate it.

We have arrived at a point that generates a lot of impatience- Stocks have stopped going down, but the volume has not materialized to push them back up. We are in that no man’s land where the market is trying to decide where to go from here. The “all clear” signal is far from being blown, but the market priced in a lot of doom and gloom rather efficiently in Q1. We are close to some sort of tipping point. I wish I knew for sure which way.
The indexes drifted up today on light volume, and the dollar gave a little ground- not much.

In the individual stocks in our little universe, there wasn’t much to talk about. SPKL continues to trade at about the same level as the $6 million investment after making a valiant try for higher levels 10 days ago.

EFSF is struggling- trying to trade lower on light volume. I don’t know if people are impatient for news of the direct marketing campaign, or if someone thinks something is awry. Nevertheless, the stock ground a little lower.

CREE turned out to be a great call in the $25 to $26 range last week, closing at $27.38 today. I sold my options for a short term gain of about $1,000 on a $5,000 investment. I’m now holding 3,000 shares of common stock at about $26.75 average.

AAPL is killing me on its way through $170. I was waiting for a bottom of $110, and it only got to $120. My mistake. Hard to buy now.

Tomorrow I won’t be publishing this daily a musing as it will be a travel day. However, I should get to questions in the BLOG by Wednesday morning.

If it’s one and done for the FED, the market could start to break through some key resistance points. Stand by for the next chapter.

CREE Options- Out

FYI- for all those who are following the situation- I bounced out of my CREE options today with about a $1,000 profit on a $5,000 investment in 3 trading days. I am still holding the common. In short, the oversold bounce back trade worked, and I like to jump on the profits in these options when I get them quickly.

CREE- Pounded On Earnings- Jumping In

CREE came out with Q1 earnings yesterday after the bell, and the stock is getting killed on the market’s disappointment.

CREE delivered $.07 when the market was looking for $.11. Naturally, the stock is getting murdered.

If you read my March 5th BLOG, you will note I advised the time to really load up would be between $25.00 and $26.30.

Today’s action has taken us to those levels, and so far I have invested in 1,000 more shares of common stock at $26.35, and 25 $25 May Calls at $2.40.

Here’s the chart:

cree1.gif

While I’m sure there will be some backing and filling, I’m not going to worry about where we trade in the very short term. As long as the stock hangs in there in the $25 plus range, I’ll hang in there.

If it falls much below $25, I’ll start thinking of either adding to the position, or taking my losses and moving on.

The chart now has a huge, gaping gap from $30 down to $26, and I’m willing to bet my own hard earned cash that gap will be filled over the next couple of months.

While the numbers were a little troubling, owning this stock is a bet on the future of the LED bulb. I believe in it. I think it will become dominant technology over the next few years.

The market always over reacts emotionally in the short term. That’s one plus. Another- Cramer doesn’t like this stock, which in my mind is a huge plus. My BLOGS of late have been saying there is nothing to be done with CREE. Today, there is something to do.

Comments and questions are welcome.

Buying CREE

CREE got beat up on a disappointing earnings report. I am pouncing on the stock today as it has fallen back to the perfect technical level in my view.

So far, I have bought 1,000 shares of common stock and 25 call options. More, including chart, in about one hour.

Musings Of Larry Isen On Today’s Action: 4/22, 1:20 Pacific

Today was all about oil and the dollar. Oil, making new highs the last 6 of 7 days, touched off the $120 per barrel today. Who have figured we would see these kinds of levels? Financial write downs were in the news again.

The markets didn’t like it, and responded in kind by giving back some of last week’s gains. Forgotten are the Google, IBM, and Intel earnings. Oil, and its widespread effect on US consumers, were the story of the day. The major indexes were all off about 1%.
And, speaking of hot areas- a fertilizer company went public on the NYSE today. It was priced at $32 and traded to $50- this shows were the strength in the market lies.

Yahoo numbers were out after the bell, and I believe their numbers are meaningless. It’s all about Mr. Softy buying them out, which also doesn’t matter other than to show there can be big boy consolidation. Microsoft wants to buy Yahoo! as a platform to try to take on Google- I heard one metaphor I liked- like two drunks holding each other up. Not much of a challenge, even combined. However, Yahoo came in at $.11 per share- and the stock is reasonably flat in after hours trading.

One of my favorite stocks is getting hit on a post close earnings release. CREE came in with $.05 vs the $.11 the market was looking for, and the stock is down to $28 in afterhours trading. As a reminder- buy around $25 to $26- sell covered calls in the mid $.30′s- this may be a buying opportunity.

Last week’s micro darling- Spicy Pickle (SPKL), was out with post close news today. Their Michigan franchisee has signed two leases for new stores expected to open this summer. The good stuff just keeps coming, and the stock is destined for higher levels.

Nighthawk (NIHK) followers responded pretty well to the weekend edition, with the stock eclipsing the $.05 level for the first time in a while.

All in all, a pretty lackluster day, but nonetheless important in the bottoming process for the markets. Clearly, some sectors are hot, others ice cold.

Musings Of Larry Isen On Today’s Action: 4/18, 1:20 Pacific

Huge day in the broader markets. Google was up $90 bucks- unbelievable- why didn’t I have a few calls on that stock? It was only a 20% move, but can you imagine having a few calls at $10, making a $90 move in one day? Awesome. I guarantee some shorts got absolutely hammered in that stock.

There were 127 new highs on the NYSE, which is a very healthy number and suggests strength in the market. However, the NASDAQ is lagging with only 52 new highs- smaller stocks have not been invited to the party yet, and the Russel 2000 is lagging way behind. We need to see some strength in the small and microcap sector to really see some bids come back.

This rally is coming at the expense of short seller and bonds- the 10 Year has moved a full 4 basis points this week- that’s a huge move taking interest rates from 3.4% to 3.8%. Money is flowing out of bonds into stocks.

The anemic volumes in the small stock end of the market are still keeping stocks depressed. That coupled with an usually high number of redemptions at microcap funds, has the supply in that arena continuing to collar upside.

SPKL had on OK day, only giving back $.01 of yesterday’s move. EFSF was sideways as well, along with PNWIF and NIHK- the subject of the weekend edition.

The large cap action is encouraging- suggesting we will see some action in the small cap world in the near future.

Musings Of Larry Isen On Today’s Action: 4/17, 1:05 Pacific

Great news this week from Intel, IBM, and now Google has absolutely smashed the number analysts were looking for.

$4.42 was the estimate- the whisper number was $4.38 (lower, which is weird)- the real number was $4.84 on $3.7 billion in sales.

If after hours trading, the stock is up nearly $50 – wow!!!!!!! Talk about a short trap- I assure you there are some short sellers that are getting absolutely mauled on this news. The Bear just isn’t growling as loud as he was in February. Unlike mortgage, finance, and banking, its nice to know the world is not coming apart in tech land.

AMD also out with numbers after the close- losses were worse than expected, and the stock is up- imagine that.

On the slightly negative side- bonds are getting killed as money is running back into stocks- that is not good for most of us as it means interest rates are headed up.

In micro land- we had a great day with SPKL- the stock traded back above the $1 level today and closed at $.95- good stuff. Same store sales growth is quite remarkable in this environment. It was the highest volume day in 2008. In all likelihood this stock has made its bear market bottom at $.70- right now, a prudent trader should pounce on this stock in the $.85 range. Not sure it will get there, but if it does- be ready.

NIHK perked up nicely yesterday, but gave back some of the gains today. More on this one in the weekend edition. The press release associated with the earnings predicted the company would turn profitable in Q4- this is a good candidate to start waking up.

PNWIF continues in its endless coma in a news vacuum. Guys- get some updates out.

I noticed TTGL put out a 10Q with no press release. $21 million in cash, but $31 million in payables- big trouble there. Probably a good idea to be out if you aren’t already.

EFSF holding above $.20. Hallelujah. I’ll take any small victory I can get after Q1.

This is all pointing to a better market environment ahead.

eFood: An Update On Scheduling

As you all know, I have been trying to get some info on commercial scheduling, so you can all have an approximate time to turn on the TV and watch the Cinnergen and Cinnechol commercials.

According to this week’s news, it appears the commercials are now being broadcast on Fox News, the Gameshow Network, Discovery Health, and the History Channel, and could eventually be viewed by as many as 300 million households.

I have learned that since we are still in testing phase, the scheduling can change on a moment’s notice. Therefore, the company does not want to publish a schedule at this time. If you were to look for the commercial at a certain time, and it didn’t appear as scheduled, the company is concerned investors will think there is a problem when there isn’t one.

I am informed this testing phase will go on for about thirty days- through the month of April. Once past, the schedule should be more predictable.

In the interim, you can view a couple different versions of the commercial at the respective web sites of the products, or just watch any of the above mentioned networks at your leisure.

Both these web sites appear to be very well done commercial sites. I note this, because there has been some griping in the past about their web presence. Visit www.cinnergendirect.com and/or www.cinnechol.com to view the respective clips.

NightHawk Finally Out With Numbers

NIHK finally came out with its long overdue 10k. I don’t quite understand why companies cannot get these things out in a timely manner. Every CEO knows- if their year end is on the calender year, that their numbers are due out by the end of March to be compliant. Then, you can get a two week extension without penalty. If you falter from there, the consequences can include losing your listing.

At the 11.9999th hour, NIHK Doug Saathoff finally delivered, and the news is bringing some life back to the stock.

I am going to have to dig into the financials to come up with some comments on how they are performing. The losses were quite severe, but you have to differentiate between operational losses, and one time cash and non cash expenses associated with the acquisition of the set top box business. Then we can get a feel for the overall health of the business.

I won’t be able to grind through it until later tomorrow, so expect a BLOG on it perhaps Friday with more useful information.

In the interim, of particular note, is the associated press release wherein CEO Saathoff forecasts $10 million in revs this year. If gross margins remain at 23%, this would imply the company will generate $2.3 million to cover costs. And, they expect to turn (dare I say it) profitable by Q4. I don’t know if Mr. Saathoff means cash flow positive or EPS, but I will endeavor to find out.

While the stock hasn’t quite traded 1 million shares yet today, it is finding some support, and looking like it could try to move higher.

More probably on Friday.

Musings Of Larry Isen On Today’s Action: 4/15, 1:05 Pacific

Another quiet day in the markets with an upside bias in both larger caps and micro land. The two stocks that seem to want to work higher right now- SPKL and EFSF.

EFSF seems to finally be willing to hang on to that elusive $.20 which can act as a springboard to higher levels. News today about their Direct Marketing initiatives, and the market seemed to like it. Nothing wrong with this stock that a few 2 million share days won’t fix.

SPKL had another 100k share plus day, holding recent gains. Please listen to the conference call tomorrow at 4:15 Eastern- dial (866) 696-5897. If you can’t dial in, and have a question you want answered, send me an email at editor@otcjournal.com.

Washington Mutual (WM) reported a $1.40 loss- the stock is up nicely in after hours trading. Bad news is good for stocks- that’s a sign of moving back towards a Bull Market.
Intel (INTC)- up 6% on earnings. Came in at $.25 on a $.25 estimate. Margins were good, and the market loves it. AMG came in a little light, so there was some concern it was an industry wide problem. Apparently, INTC might be pirating some business from AMG.

This all bodes well for another nice up day in the markets tomorrow. Of course- there is one big negative- oil at $113- ouch. US demand is down about 7% from last year, but there is still an oil bubble inflating out there. Eventually, this price will have to moderate world wide demand, and the price will correct. Two years ago I would have thought we would be in a full blown depression with $113 oil, but apparently we are more resilient than that.

I have some absolutely fantastic alternative energy ideas coming. Stay tuned.

Musings Of Larry Isen On Today’s Action: 4/14, 12:15 Pacific

The market has every to melt down right now. Between numbers on the economy, the GE numbers last Friday, the recent run up in stocks, and the lowered estimates by Arch Coal, the market should be absolutely tanking.

However, all we are doing is giving a little ground against this very rough back drop.

When bad news stops driving down stocks, you know you are close to a bottom in the market. Last week WM- Washington Mutual – one of the biggest sub prime lenders- announced it was raising $7 billion from a private equity- Wachovia is said to be following suit- guess what- WM made a 50% move to the upside on the news, which was short lived.

The big money is now moving into blown out financials at bottom basement prices- making the assumption the worst of the sub prime mess is behind us, and these lending institutions will do very well in the next low interest environment.

Of particular interest is the dollar- Bernanke’s plan to provide liquidity to the system without printing money has the dollar firming. Check out UUP- that’s the ETF to go long the dollar. It has started making a series of higher lows, and looks like it could be completing a bottom process.

If the dollar firms, two things will happen- 1. The big “trade” will begin to unwind- long oil and short the dollar, and 2. International money will pour back into US equities. It has been on the sidelines for sometime as the perception is that the stocks can go up, but if the dollar goes down they make no gain.

On the micro side, SPKL is making a very good showing today on a nice volume blip. Investors are anticipating something good out of the company with the conference call coming on Wednesday. Investors are also recognizing the stock is cheap.

EFSF is also trying to make a come back- it finally appears to be ready to hold on to that elusive $.20 level- still waiting for a broadcast schedule.

NIHK still has not done their 10k filing, along with CPNE, who I really don’t care that much about anymore.

On the short term side, I am out of the RIMM trade. The theme was right, the security and the timing were wrong. I know some of you lost money, others who were smarter, had better timing, or just plain lucky made money.

Right now, I would prefer a couple of nice down days to go long. I believe the worst is behind us. Bad news no longer drives stocks down. For the most part- it’s all priced in and we are poised to return to better times.

RIMM Closed Out: Ouch

The market gapped down this AM on the heels of the GE earnings missed, pushing RIMM down a couple of points. After yesterday’s rebound in RIMM, this was a heaven sent event, but only pared my losses on this idea marginally.

Had I shorted the stock, or bought the options another month out, I probably still would have made money on this trade. However, time was running short on the trade, and I couldn’t take the risk of staying in any longer.

Now, RIMM will no doubt completely fall apart and head right down the to $110 level I was looking for. I believe I lost about $9k on the 20 puts I sold today. Ouch. It’s going to take a good trade to make up for that one.

Musings Of Larry Isen On Today’s Action: 4/10, 12:40 Pacific

Great day in the markets, which is fine with me except for my open put position on RIMM. The trade did not work, and I will be closing out my other 20 puts at a loss either late today or tomorrow. I am now 5 for 6 on short term ideas- Of course, RIMM is the one I put the most money in, so it hurts the profits on some of the other ideas.

In today’s action, Semi index up 2.7%- Biotech index up 3%- Consumer Discretionary up 1%- this means there is a bid coming back to the markets. The Semis and consumer discretionarys moving up is a great sign. A Japanese company is buying out Milenium Pharma at $25- and the stock is up 8 points or 50% on the news. Hence, the biotech rally today.

Aside from getting my butt kicked on the RIMM trade, CREE is behaving well today- up $.24 into the mid $28′s- at this price, there is nothing to do here. I keep saying buy at $25- sell calls at $35.

EFSF, the little stock that could, is trying for higher ground again, with a high print of nearly $.21 with about 300k shares of volume.

The loss I take on RIMM will be made up for as other stocks I am long appreciate. The worst of the Bear is clearly behind us, and the stock market is buying into Bernanke’s moves.

I love the tone of the markets. I believe there is easy money to be made on rebounds in EFSF and SPKL- perhaps PNWIF as well. NIHK could be a candidate for a rebound if they can ever get their numbers out.

All in all, the market sure looks like it’s in recovery mode to me. The big ones lead the small ones back in this kind of environment.

Looks like the pain is over- at least for the time being.

Two Closed Positions: RIMM Puts and QPCI

FYI:

I closed out 15 of my 35 RIMM puts today for a $2275 loss. I can handle that. The trade is not going as planned, and I took advantage of this down day to limit my loss potential. $22,500 in total capital is a lot for me in a position this speculative, so I wanted to limit my loss potential. I am hoping for another 3 point drop tomorrow. If it comes, this trade will be fine.

Also, I mentioned I had picked up 20,000 QPCI on Friday. I closed them out yesterday, and made a few hundred bucks. The stock was looking a bit tired, and I’ll revisit after it corrects a bit.

Musings Of Larry Isen On Today’s Action: 4/9, 12:15 Pacific

Sorry to those who have been looking for this daily review earlier this week. Got a bit distracted working on some new ideas to come, old ideas that should head back in the right direction, and Spring Break for the kids.

On to some fun stuff.

The market is cracking a bit today on a new all time high for oil- north of $110 per barrel, and UPS revising estimates lower. Trannies are getting hit. Oil and gold are up. These commodities, are nearing the top of a speculative bubble. The evidence is everywhere. At this price, demand for oil will wane, and it will correct. Might take some months. Gold is close to being ready for a big correction some time between now and the end of ’08. Like dot coms and real estate in the last 10 years, all bubbles eventually burst. The more they inflate, the more painful when they burst.

The correction in the markets today was help for my puts in RIMM- that position has been killing me. It’s the first stock in months that didn’t fall apart after running up into a good earnings report. I was pretty exposed with a total investment of $22,500. When the stock traded below $118 today, I closed out 15 of the 35 puts at $4.90 for a net loss of $2275. I’ll hang on to the other 20 puts and see what happens tomorrow. If there’s another down day like today, I’ll actually make money. However, if the darn stock turns back up, I’ll have to limit my losses and get out. If I had a longer window in time on these things, I would continue to hold, but they will expire in short order. If I had just shorted the stock, I’d be making money. I don’t mind shorting indexes, but I avoid shorting individual stocks. I just need one more day down 3 points, but it needs to be this week.

I mentioned QPCI in the weekend report. The stock was looking tired and the volume was dropping, so I sold the 20,000 shares I had picked up on Friday and made a few hundred bucks. One to watch on a correction.

After filling the gap, SPKL is looking a bit stronger. There’s an easy money rebound forming here. The sellers are all blown out, and there’s probably easy money to $1.

There was a surge of interest in EFSF yesterday- the stock traded north of 1 million shares for the first time this year, and made a high of $.22. I’m not sure why, but it’s a promising sign. I’m still hoping to get my hands on a schedule of commercial broadcasts to share with everyone, but the 411 is not forthcoming as of yet.

I was able to confirm that PNWIF is indeed now providing services for Sam’s Club, so that should help numbers. No 411 on Costco one way or the other yet. I would love to see that darn thing get up to $4 and hang there for a month. NASDAQ SC would be close at hand.

NIHK and TCGD still delinquent on their filings, so no comments worth mentioning there.

SPKL: Are We There Yet?

SPKL continues its pattern of trading very poorly on increased volume, and I’m getting a lot of emails with basically two questions- 1. Is there something wrong with the company?, and 2. Is it time to buy yet?

Those of you who have really been following this story know that I am uniquely intimate with this company. In fact, I was instrumental in helping them in the process of choosing to go public, and a lot of the pre public shareholders are personal acquaintances of mine.

Therefore, I can state with a great deal of certainty there has been no fundamental derailment at the company. In fact, just the opposite is true, the company is accelerating on every front- franchise sales, company owned store growth, and real estate acquisition. The only weakness of late has been the vacuum of new store openings in the last three months- This was simple a cycle issue, and new store openings will start to pick up again later this month.

However, the stock has been under pressure of late, and I am choosing to step back and see how low it wants to go. In my view, SPKL has become a victim of the new SEC regs related to shortening up the time frame for 144 filings. It used to be that investors had to hold shares for a year under Rule 144 before they were eligible to become free trading. As of February 15th, the time frame has been shortened to 6 months.

There have been a rash of filings of late, and I believe the recent weakness in the stock is related. I am monitoring the volume as it related to the filings, and will notify everyone when I believe the selling is about done.

In the interim, here’s a look at the current chart:

spkl1.gif

As you can see, the gap I have been looking for filled on Friday. As such the stock is close to being in position to turn back up. Almost there, but not quite. I would suggest giving it a few more days to a week.

Comments, questions, and in this case, complaints are welcome.

RIMM Reviewed: Hanging In There

For those of you who followed the earlier posting from today’s post open, you know I took a fairly substantial high risk position, betting that RIMM was ready to enter a corrective phase after the market priced in yesterday’s earnings release before the fact. That’s my story and I’m sticking to it.

Today was a bit painful as my early entry into a short position is initally a losing trade- for now. The stock was about $121 when I entered the trade, and it closed at $122.58 after trading much higher- ouch!!!!

However, I’m sticking to my guns with this trade. I still believe the profit takers will surface in a big way once the volume quiets down.

Here’s the chart I’m looking at:

rimm11.gif

The circles show the action in volume and price at the last earnings release. Note the big gap on the release, and two huge volume bars. At this time, the volume quiets down after a couple of days, and the stocks starts giving ground.

It doesn’t bounce until it gives away a full 45 points.

However, that was the beginning of the Bear Market. We are now seeing signs of a aging Bear, or perhaps a young Bull emerging.

I’m going to simply hang in there unless the stock trades convincingly above the horizontal line at $124.50- at that point I would consider limiting my loss and closing out.

If RIMM does continue much higher and blow me out of my position at a huge loss, it will be painful for my trading money. However, on the plus side, it could be signalling the end of bear. We might go from selling the rips and buying the dips to buying momentum again. In the larger picture, that would be the far better environment for us all.

Comments and questions are welcome.

RIMM: Making a Bigger Bet

As they say in Texas Hold Em- I’m all in now, and I hope I made the right call. I added to my RIMM Puts in a much bigger way shortly after the open.

I picked up 30 RIMM April 120 Puts at $6- I’m betting the stock will correct now, and correct to the tune of 10 points or so. Once it cracks, I believe the hot money will come out, and down we go.

Right now, I’m in for 35 puts at a average cost of $6.41. Total investment- $22,500. Keeping my fingers crossed.