Thoughts on TiVo?

[Shawn Keller]

Just looking for informed opinions on investing in Tivo, everyone who has it seems to love and couldn't imagine their life without it (there is a thread on RGP just about tivo with 22+ responses). I know it will be a big seller over the holidays and I'm thinking that network effects will come into play, i.e. people will recommend it to there friends and because the stock price is so low (around 5.2) it will go up substancially.

Any thoughts?

Shawn Keller

[Mark Heide]

Shawn,

If you like to speculate on penny stocks this may be your choice. But, I'd stay far away from it. Analyst ratings have indicated that they will still continue to opperate at a loss for next year. What you need to find out is when do they expect to make a profit? I think this one is a long term loser. I don't think the people that are buying this stock are looking at the bottom line. Sometimes, people buy these types of stock because they are familiar with the company and like the service they provide. Just my opinion.

Good Luck

Mark

[Shawn Keller]

I wouldn't consider it a penny stock, I thought those were only stocks under $1. I don't actually even own tivo's product although I will probably buy it soon, I have just heard a lot of great things about it. I know it still hasn't made promising earnings but I was hoping it might based on a strong christmas, and a strong january assuming people who got it for christmas recommend it to there friends and associates, is this fuzzy thinking though, I haven't researched the stock in great depth?

Thanks,

Shawn Keller

[Mark Heide]

Shawn,

Most people consider stocks that sell for less than $10 to be penny stocks. Anything in this category is high risk. When I looked at the fundamentals for this stock I noticed that they have report losses throughout the year. The question is will they ever come to a point when their income will cover their expenses? I suggest doing a lot of research on the company. Try using the free tools at www.quicken.com. (http://www.quicken.com.) Here's a link:

http://www.quicken.com/investments/strategies/?p=TIVO&tag=1

I like using the Robert Hagstrom Warren Buffet model to analyize potential companies for investing.

Good Luck

Mark

[adios]

IMO anytime a company has a negative book value (BV) it's financials deserve to be scrutinized closely. Granted there are highly regarded companies that do have -BV. A quick scan of the balance sheet for TIVO shows me they don't have liquidity problems but may have solvency problems. I would get their most recent 10Q and 10K and review their capital structure very closely. They've been negative income and negative cash flow for awhile I believe.