Thursday, September 14, 2006

Schaeffer's Comments On XMSR

Schaeffer's Daily Market Blog Features Comments on XMSR
Business Wire 09/14 13:56:05

Credit Suisse Upgrades XM Satellite Radio
The second-strongest stock on the Nasdaq today is XM Satellite Radio Holdings (NASDAQ:XMSR), which gapped higher today after CreditSuisse upgraded its rating on the company to "outperform" from"neutral," citing valuation. At last check, the stock was up more than10 percent at $13.85. Sentiment on XMSR is mixed. Short interest fellmore than 22 percent in August but 12.5 percent of XMSR's float remains sold short. This is a good sign, because the short sellers might decide to buy back some of their bearish bets to limit losses, which could push the price higher. Turning to the options pits, XMSR earns a Schaeffer's put/call open interest ratio (SOIR) of 0.67, telling us that calls outnumber puts by a ratio of three-to-two. Looking back at the past 12 months, we find that this ratio is in the middle of the range, so sentiment amongst the options crowd is rather neutral. According to Zacks, 10 analysts rate XMSR a "strong buy" and another three see it as a "buy," leaving plenty of room for downgrades. There is only one "strong sell" rating to balance the extreme optimism, but the 10 cautious "hold" ratings leave considerable room for further upgrades. All in all, I'd watch this one. The stock entered a clear downtrend last September, but a bounce from support at the 10 level, seems to have pulled in the buyers. This week it is trading above its 20-week moving average, above which it has not closed since September 2005.

9/14/2006 02:18:00 PM

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