China Digital Revieled

China Digital TV Holding Co., Ltd. (STV) is my spec play for 2008. Here is why:

• This is a recent IPO in the China market which has played out the initial hype (rise and fall)
• The company makes digital access cards (required to watch digital TV) and controls roughly 45% of the market in China.
• China is mandating that the entire country convert to digital TV by 2015...meaning lots of these will be sold in the next few years....especially with the Olympics coming next year.
  
• A great article was written back in October trying to forecast the forward growth of the company. It concludes that if the assumed growth rates hold as forecasted by the company then the stock price should be between $65 (conservative model) and $105 (agressive).
  
• The company then reported Q3 earnings in November...here is how they compared against the projections from the company in Oct...clearly great numbers:
• They also provided Q4 guidance of around $16M (again above the companies original projections).
  

Even if the stock only climbs to the conservative $65...from $28 that is nice 132% gain. It looks like the company is well positioned in a guaranteed growth market. As long as it can stay ahead of the competition...it should enjoy a nice ride for at least the next year or two. I am not betting the farm on this one since it is still a spec play at heart....but a little here could go a long way in this case.

'Tis the season

With the Holidays rapidly approaching it leaves very little time to think about finance...except for how much you are spending on gifts. Hopefully you had a budget to begin with so it makes it easy to figure out how screwed you are ;-)

For the record:

Sold: I sold MEMC (WFR) today as it hit $93 which was way over my target of $85. That locked in a 27% return in just under 2 months. I am sure that it will still climb....but I am willing to sit on the sideline for now since it is so far over the price targets.

I wanted to purchase more GLS and GNK which are both pretty darn cheap right now...but I have my funds tied up in a transfer....more on that later...

I also want to buy China Digital (STV) here at $28....but need to wait a bit. I will explain all the reasons I really like this spec play in the next week.

When enough is enough...

So unless you have been under a bus lately, you have noticed that all those November Blues are finally behind us. The market is back up to almost 13,800 from a low back in Nov of ~12,800. Most of this was due to the expectation that the fed lowers rates tomorrow. Ok, but then what? We are still seeing a lot of bad news come out of the banks, the projections for the housing market next year call for about a 12% correction (from the highs in 2006), oil is projected to go higher or stay around $90-$100 and people will be selling for tax reasons come the end of the year putting some pressure on the market. So let's assume that the market rides the news tomorrow to around 13,900 or even 14,000....the historical trend suggests that the market will fall back down and take another breather. So maybe it is time to lighten up a few of those holdings or at least set that trailing stop a little tighter on the ones we are worried about.