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Shanda Games Limited (GAME) Message Board

  • hcomhlu hcomhlu May 23, 2013 3:08 PM Flag

    buy under 6 USD

    add more

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    • I've been in GAME for a long time. Loving the moves lately and really loving today's news about the company having more in the pipeline after the success of their latest release. Are you still looking at 6? I like buying under 12 in the long run.

      Sentiment: Buy

    • now it is time to add more shares: great chance for last time

    • The earnings were impressive enought to those that follow this stock to create 5M in volume, which is the first time in over 2 years.
      Sometimes "flat" revenue is bad, but when revenue and earnings have been declining it can be a good thing.
      GAME has 75% of it's market cap in cash, and plenty of other assets beyond that, but if the trend is down I guess everyone thinks one day all that will go away.
      But the fact is they generated over 45M in free cash flow just last quarter, and that's after investing large sums of money into new game developement.
      GAME also is diversified, in that it's revenue is not tied into just one or two games like PWRD, CYOU and NTES.
      The mobile side also finally appears to be taking off, going from 0% of their revenue to around 10% in just one year.
      While this is all nice, my reason for buying and holding is the buyback and the limited float. Insiders (CHEN) owns about 80%of game with the share count being around 270M but less than 55M in the float. You simply can't keep buying back shares at a $50M clip (like last year) or the announced $100M buyback this year with the share price this low for long. There simply will not be enough shares left.
      In the end Chen will take GAME private just like he did SNDA. My belief is he will do it near the initial IPO price of 12 to aviod lawsuits and bad will. The cost will be minimal to him since so few shares will be left.
      Problem for short term traders is this might play out over a couple years. At some point the the decling float and the share price will reach critical mass and jump, but it won't because the company is pushing it higher on purpose...that will come later when the float is low.
      Of course, retail investers could bid the price up, casuing a delay in the plan.
      If this jumps above 6 in the next couple months I'll probably sell, since all that is happening is the buyout will pushed back since the 100M share buyback will take longer to lower the float.

      Sentiment: Strong Buy

    • Could you share your justification why buying? How to explain today's huge volume and big jump? The earning does not seem impressive.

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