Insider Investment at Rite Aid

A week after trimming back its outlook for the current fiscal year, Rite Aid insiders are loading up on cheap shares:

[CEO] Mary Sammons and fellow board members Robert Miller and George Golleher purchased 1.48 million shares in open-market transactions this week. The price: $1 a share. Sammons bought 486,750 shares, while Miller and Golleher bought 500,000 shares a piece.

This is a significant vote of confidence by people who are "in the know" about this company's long-term potential. While I think it's going to take longer than I had hoped to turn a profit on this investment, I still expect I'll end up well in the black.

E-Trade (Again)

Company:	E*Trade Financial Corporation
Web Site:	http://www.etrade.com
Purchase Price:	$2.46
Current Price:	Click Here

E*Trade is one of the pioneers of online securities trading, who took a significant loss (five billion) in the subprime lending crisis, which sent its stock price plummeting from over $25/share to almost $2/share over the course of several months.

I played this stock earlier this year, and made a pretty good profit on it before it started to sink again and I cashed in my chips. Today, the company announced the sale of its Canadian subsidiary for almost half a billion dollars, which should go a long way to improving their debt ratio, and I expect that the shares will start moving up again, so I'm buying back in.

As before, I'll keep a close eye on things, but I expect to make another win.

Weekly Summary

The market in general has been in chaos this week, and my own holdings are down. On the bright side, I'm still in the black ... by about a buck:


I'm still trying to dump my shares in GoIP Global, but there simply isn't sufficient value to unload them at any price - my sense is it won't be long before the stock price won't cover the commission to unload them, and I'll end up taking a total loss.

Rite Aid cuts fiscal 2009 outlook

Sometimes, my timing really sucks ...

Drugstore operator Rite Aid Corp. on Wednesday reduced its guidance for fiscal 2009 because of refinancing costs. The Camp Hill, Pa.-based company said it now expects net loss between 39 cents and 52 cents per share, compared with previous guidance for a loss of 34 cents to 48 cents per share.

While I still expect that the firm will eventually dig its way out of debt, its shares are sure to plummet in the short run, and since the price is getting close to the $1 mark, they may either have to reverse-split (which is never a good thing) or face the prospect of being delisted (ditto).

So long, SOYO

SOYO Electronics has dropped to the point of no return, so I've cashed out to salvage what value is left:


I held out hope that this former microchip manufacturer could segue into the consumer electronics industry, but they've not been very successful - by all accounts, their products have been good, but they don't know how to define their niche, establish a market for themselves, or compete against more established firms ... and they don't seem to be learning from their mistakes.

And so, it's time for me to bail. I'll keep an eye on the press releases to see if they bring in some talent to help them make the transition - but for now, I'm no longer willing to fund their clumsy efforts.

Weekly Summary

Another week has gone by, and the ups and downs in my holdings have once again balanced out:


SOYO has puts its toes across the point of no return (a 50% loss) and I will be looking to unload it and cut my losses unless there's some significant development in the next few days; GOIG has been there for a while, but it's so thinly traded that it's impossible to unload my shares at any price.

On the brighter side of things, I'm beginning to consider when to take profit from KKD, which has shot upward but seems to have reached a new plateau, and FEEC, which I already cashed out my original investment, and whose star also seems to be fading in recent weeks.

Video Rental Follies

It's ben a busy week in the video rental industry ...

Last week, I bought into Blockbuster video, after the press got wind of Netflix's unilateral decision to dump "profiles," one of the few features that gave the firm competitive advantage in the industry and Movie Show Video, its main brick-and-mortar competitor, announced a desperate restructuring plan to stave off its creditors.

While Movie Show is still speeding downhill, Netflix came to its senses earlier this week and announced that it would keep the "profiles" feature (and retain the customers who were threatening to jump ship) - and since Blockbuster failed to act on this opportunity, the window for them to regain some ground in the online market has closed ... at least until the next time Netflix takes aim at its own foot.

However, there's still some potential for profit, asn Blockbuster announced today that it has reconsidered its plan to buy electronics retailer Circuit City Stores, which many analysts saw as a marriage of two struggling firms that would produce little fruit, and the stock snapped back upward by five percent (Meanwhile, CC shares plummeted to a seven-year low).

I expect the stock will continue to recover as the news spreads, and I will probably cash out sooner than expected, with a smaller gain than I had hoped, unless they can build on this momentum by announcing alternative plans.