Dronamraju Ravi Prakash

IACI announced that they are going to spin off expedia into a seperate company. I love this :) They were a bit late, but nonetheless they are being smart. Travel industry - while competitive - still has a lot of efficiency to be extracted out and lot of revenue for a player like expedia.
Kinda weird though - buy a high growth company, fold it in, then spin it off. Good news is that the new Expedia has
a) Expedia
b) Hotels.com
c) Hotwire


I want a piece of Expedia. Now the challenge is to figure out which position i have to get out, to get into IACI. So I am getting out of PRZ (@2.91) and i might have to get out of other stocks.
Any opinions on prospects of OSTK? I might get out of that too

Not to pick on bambi, but she's being an idiot yet again, I have previously posted about bambi francisco's faulty logic.

Today she's providing commentary on ebay's buy out of rent.com. The article has a tag line(?)

Is ebay buying at the top of the housing bubble?

She goes on to say...

The revenue that Rent.com is bringing in has been driven by a record year in home sales. In the U.S., the turnover of existing homes is running at a record rate of 9 percent, according to Goldman Sachs.
....
If real-estate activity remains robust, that's good news for businesses like Rent.com, which help homeowners rent homes or assist people in moving and settling down in a new place. Rent.com even offers a listing of local wireless phone services and dating services.

So, i went on to rent.com site, to find out that they are predominantly apartment search site. Doing a search for housing in sunnyvale, i get a ton of apartments, and very few "houses".
I wish she actually did some research before she posted random stuff like this. Rental prices have not been very strong in several markets including south bay area, LA and phoenix (those that i kinda know). Big reason for the weakness in these markets is the ease of buying houses and strength in the housing market.

So ebay, might actually be buying rent.com in a weak rental market. Bursting housing bubble (if it does) might actually help rent.com

Bambi, either look at the website you post about, or stop posting your "analysis" about these deals and just post the news.

Over the weekend i read the article that mentioned reed hasting's analysis of his competition. I concur with his analysis. Infact last week i was mentioning very similar things in my discussions with chuckakung. Desperate blockbuster is going to spend more money and loose more money.

In anycase, I thought more about reed hastings and NFLX. Now, i feel that the management has the right view of the world in place and the multiples are excellent. At 653M $ we are paying about 250$/customer (assuming 2.6 million customers). Not too bad.

So i am buying NFLX again at $12.50

To make room for NFLX in my portfolio, I am exiting RHAT (not too excited about recent moves) and SEAC (not intricately familiar with their business)

Aah that wasn't the best of days for tech stocks. Actually, my portfolio is up since dec 1. I am just spoiled and want stocks to go up every day.

On a side note, my post about bambi francisco's article got picked up search engines. I get few people a day coming to this site from google. Never knew bambi was popular enough to get searched on every day

Got to love leaps during a bull run. Got into AMD 06 leaps less than 2 weeks back and they are already up by 75%. The underlying stock moved only by 20%.
One key thing i have recognized with LEAP buying is timing. Timing is lot more important when buying leaps than the underlying stock. I have in the past bought leaps for stocks which i thought would do good. The stock actually performed with in my expectations, however the benifits out of the leap strategy were not as stellar.
The key thing i learned from those experiences is about the decreasing time value. Here are few things i look at before buying a call/put leap

1. Look at the time value being paid by in-the-money or at-the-money options versus out of the money options. Frequently, i found that at-the-money options have slightly higher time value but better performance as the stock moves.
2. I prefer not to get into to really short term options. With LEAPs i prefer to time it somewhat in terms of the stock momentum. Watching the attrition in time value because of a flat stock price is not fun.
3. Tend to buy leaps ending in january. Mainly because of the tax flexibility. i have a choice to take the loss/profit in either year and timing coincides.

Intel raised it's 4Q projections. Great news for the whole sector. INTC is up $1.50 after hours and AMD is up 0.80$ after hours as well. My AMD options are looking excellent. They closed the day at $5.00 and i am sure they will be up to $6 tomorrow. Excellent returns for 2 weeks :)

I am now seriously look at AMAT leaps and INTC leaps for the Jan 06