Ramit Sethi from www.iwillteachyoutoberich.com proposes a financial makeover for 2006. So far there he’s laid out the first three steps.
First some history. I had said before that my plan with SIRI was to unload the shares after the new year. But the sell off came sooner than I had planned. Soon after topping out at $8 the first major analyst downgrade occurred plunging the stock to about $6.50, where it hovered for most of January. Sadly, I wasn’t able to lock in my profits before the slip. At $6.50 I sold half my position, expecting more analysts to jump on the bandwagon. A few downgrades and -$0.60 later, the stock is trading below $6.
My new plan: I’ve picked up 70 shares at $6, and plan on picking up 70 more shares if the stock falls to $5.50… 70 more if it falls below $5.00.
People seem to be backing XM (XMSR) over Sirius now because of the lower PE and valuation. I’m going to stick with SIRI however because I still feel these companies are first media companies, and Sirius has the better content. I expect both stocks to do well over the year as they both come closer to making a profit. SIRI’s share price should sore as earnings and new subscriber numbers come out over the year. I’m expecting SIRI’s growth (in subscribers and revenue) to run faster than XMSR. When was the last time you heard someone say they are switching from SIRI to XM because of the programming? I hear it the other way all the time. I’m setting an aggressive price target of $10 for SIRI by the end of the year.
Advanced Micro is doing well. The stock is wiggling around $40 a share these days. At this point I would be tempted to “take a little off the table”, but I only have 15 shares and my real goal is to build a position in the stock in preparation for what I expect to be a good 2007. My plan is to scrounge up some cash and look for a chance to buy some more stock.
While I don’t own Yahoo! stock, I did recommend it last week. The stock is still hovering around $35, but not for long. There is going to be a lot of good press around Yahoo! over the coming months. Also, people will wise up and see that bad news for Google is not necessarily bad news for Yahoo! (in fact, it could be good news).