Wait for the after market. That’s a busy phrase in my life today, and it isn’t even 9AM as I start typing. Three stocks familiar to my portfolio will announce earnings after the market closes. My blog post about Microvision and the after market HUD being developed by Pioneer has drawn a lot of traffic. And living on the west coast means that there’s a lot of day left after the market closes, and I’m looking forward to that too. So much for being in the present. Evidently this morning’s a time to think about what comes after.
There are many caveats about after market trading. The volumes are thin. There are fewer trade restrictions and protections. What happens then is usually disassociated from what happens the next day. I can’t recall ever trading outside of the normal hours. Today it is moot. I don’t have enough cash to make a difference and I have no intention of selling before the news. Others may be waiting for the moments I miss though because they want to react before the market or to take advantage of those that dive in without life guards.
After the market closes, Dendreon, Real Goods Solar, and Gaiam (DNDN, RSOL, GAIA) all plan to announce earnings. Dendreon is my largest holding, even after its plummet. Real Goods Solar is one of my safer plays, though no play has been safe in this market. Gaiam is gone from my portfolio, but seller’s remorse and curiosity encourage me to watch one more time.
Here I am at the start of November, ready to sell something else (unless book sales, photo sales, teaching revenue, consultation fees or a lottery jackpot come in quickly.) As I’ve said recently, I think the low end of DNDN’s buyout value is $60, and the real value of the company is much higher. Current valuations are based on fear, or rationalized by only accounting for current revenues and not accounting for treatment, region, or pipeline expansions. Prior to last quarter’s earnings report the stock drifted from $42 down to $38 and then deflated all the way down to $8, largely because of a 20% miss on revenues, but probably because the news came out almost on the same day as news about debt ceilings and European crises. A 20% drop in revenue might be recovered within the last quarter, in which case the revenues didn’t vanish. They were merely delayed. DNDN at $38 again is enough to pay my bills and draw down some of my credit card debt, and maybe switch back to bottled wine after a few months of boxed vintages.
Real Goods Solar doesn’t have as large on influence, yet; but it is trading at less than book value and only at about a third of sales, and sales have more than doubled since 2008. Doubled the revenues and halved the stock price. Can you say irrational market?
Gaiam reporting earnings at the same time as Real Goods isn’t a surprise. They are tied because Gaiam spun off and owns a lot of Real Goods. Both companies have similar price-to-book and price-to-sales ratios, despite the fact that Real Goods is effectively a construction firm and Gaiam is a consumer retailer. I sold GAIA at the end of September to pay some bills. Since then it’s risen from $3.24 to $3.80, up 17%. Oh well, so it goes.
Which set of numbers will finally bring a rational reaction from the investment community? I have to wait until after market close to find out.
Microvision is influenced by another variation on after market, but this time it’s cars. Pioneer is developing a head-up-display for cars, a see-through display that draws directions onto a windshield so a driver can concentrate on the road and also see where they are supposed to turn. Evidently, some mysterious units are being designed for new models, already incorporated into the vehicle; but to get to market quicker, Pioneer is selling a clip-on unit that can go into existing cars.
Working within normal market hours and market cycles doesn’t seem to be the theme for the day.
So, what I am looking forward to the most? What happens after the market. As much as I write about market conditions, stocks, personal finance, and strategic planning, I am most interested in what happens in the rest of my world. Too many people are too wrapped up in the world of finance to see the world beyond Wall Street. It is easy to get trapped within the bubble that paints the world with variations of dollar signs. Compassion has a rough time filtering through.
A friend and I were talking last night about life in the mainstream whitewater versus life in the smaller rural eddies. Rural island life can be taken slower because it becomes obvious that there’s more than enough to enjoy in the here and now, and the here and now are delivered every moment for free. We both chose this life consciously. Frugality has its benefits because it makes such a life more sustainable and attainable. Of course, substantial wealth wouldn’t hurt. We’ve both been there and know what that’s like too. It’s nice to know that money doesn’t have to change anything except making it easier to pay the bills. (I truly enjoyed paying utility bills months in advance so I could ignore them for months to come. Ah, those were the days – that may come back.)
I’m invested in the market because I live in our society. Over the long term, investing can make money from money, which is an advantage I don’t want to ignore. My friend invests in land. I invest in stocks. I know others that invest in others. But I do it, and we do it, for what happens elsewhere, for what happens after we turn away from the market and turn back to our lives. What comes after the market is the rest of life.