What is going on with Sirius?!?!

[player24]

The Street is looking for industry (Sirius and XM combined) subscriber growth from 4 million at year end 2004 to 51 million by 2014. To put this into context, by 2010 satellite radio will achieve 31% penetration of US households, 15% of total US vehicles and 12% of total US population. Current penetration is 4%/2%/1%.

Assuming these assumptions are correct, the key for Sirius will be raise market share from 24% currently to 50%. If the company achieves this objective, and they don't go overboard with programming costs (Stern, MLB, etc...)the stock may do okay. The unfortunate/typical aspect of the stock story is that everyone knows satellite radio is going to be huge and the market has already priced this assumption into the stock. Although debt is high (see S&P credit report posted above), liquidity is ample and near term bankruptcy risk is fairly low (no big debt maturities in the next couple of years).

Stock may be dead money because of high valuation, but it probably won't bust in the near term unless the duopoloy is disrupted (i.e. unexpected competition). And, with heavy retail involvement in the stock (apart from the many day-traders) and plenty of hype-headlines to come, stock could do well over the near term - particularly if the new satellite radio customers are happy with the service and they run out and buy the stock (a typical phenomena that affects hot consumer product/service providers.)

[tek]

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Every stock position can optionally protected from catastrophic loss, by employing the Stop Loss order.

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Dan, do you personally use actual stop loss order, or just mental stop loss targets?

[Dan Mezick]

Tek,

Every filled order has a protective stop within one business day.

[player24]

The idea of America's major two satellite-radio providers merging has been tossed around almost from the moment Sirius Satellite Radio (SIRI) launched its service against XM Satellite Radio (XMSR) back in 2002. XM had a year's head start, but as Sirius' share of the market surged, many analysts predicted a duopoly, with both companies eventually splitting the market in half. Yet, Sirius' surprising strength suggests it might be time for both companies to consider an alliance again. Continued head-butting could slow down both companies' quests to reach profitability. And they'll need financial stamina in the coming months, as they face a mounting threat from a slew of emerging audio technologies. Source: Businessweek

[tek]

No, I mean in real life what are your thoughts about mental versus placed stop losses.

NM, I saw your reply on the other thread.

[Dan Mezick]

In my view there is no stop that is not an actual order, to sell at a predetermined lower price.

I use immediate, actual stops after every order fill.

Sometimes I scale the stop-loss selling, for example if the lot purchased is large, and/or the shares purchased are thinly traded.

As soon as you take a position, you are a member of the crowd.

Crowds are not known for effective and efficient decision making.

I consider it very worthwhile to read THE CROWD by Gustav LeBon for purposes of studying as a serious market student.

This book explains the primitive nature of crowds and is a great read.