Wednesday, May 12, 2010

Spooky Specs

Thinking of specs, a.k.a. penny stocks, I can't help but use trashy analogies. I mean, a 44-cent stock has no business being a big part of any portfolio. That's like asking the Octomom to be your wife and offering to sire her next eight offspring.

With that in mind, a little spec-wreck observation never hurts. Beats wasting money in Las Vegas because although 9 out of 10 pennies will crash and burn (my official guess), that one penny that survives and rises out of the ashes ... you never know.

• JMBA. I like Jamba Juice. Tastes so good. Fricking expensive now, though. It was 3.75 or so for an "original" sized drink two years ago. Now it's almost 5 bucks. Holee shit. But I digress.

Several months ago, I saw JMBA at 2.00 and dug into the data. I couldn't pull the trigger. Now it's nearing 4.00. But it's still cheaper than a Jamba drink. Might last longer, too.

• BBI. Did some reading on Blockbuster. I was at one of their locations in Honolulu during a closing-the-shop sale. I had no idea it had gotten that bad. But at 44¢, BBI isn't dead yet. The CEO refuses to give up and has locked in a deal that will allow Blockbuster to rent fresh flicks — while Netflix has to wait a minimum of 28 days.

There are a multitude of issues at Blockbuster. Can they stream efficiently and shut down those expensive brick-and-mortar expenses? Is it too late? Is there a stigma? I think people want cheap goodies and they want it fast. So BBI could justify being a $2 stock in the near term, if things go perfectly in their favor. Damn, 44 cents! What can you get for 44¢ any more, maaan?!

• FNM. I actually took a chance on Fannie Mae a few months ago. What a damn stupid trade that was. There's hopeless, and there's FNM. Even with Uncle Sam's full protection, this stock can't get anywhere. Goes to show, you gotta have something of value when you come to the table. Not a bunch of stupidass, dumbed-down mortgage policies that cost the Fed beeeeeeeellions of buckos. Never touching FNM again. Really.

• C. Whoever bought Citigroup below a buck is a genius. Case closed. Now, at around 4.20, I still wouldn't feel comfortable holding C shares for the long term. Trading it short term is another thing, but long term? Schizo, roller-coaster action that makes normal humans puke.

There are lots of people who can buy something like C at 80¢ and forget about it for five years. That would be best. I'm not one of them. Not with all of Planet Earth going through financial hell, followed by the equivalent of plastic surgery/makeovers, ingesting massive amounts of steroids and other human growth hormones ... but they do have nice smiles and look good in photos.

More penny painsters later.

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