Videocast — SMSI Technical Break Out!  Plus, an update on RDCM

Long-time readers should note some significant changes in how I communicate in the public domain. The primary purpose of this forum is now to attract new contacts with professional industry expertise to share research and receive feedback (confirmation / refutation) regarding my investment theses.

Accordingly, this document should not be construed as an endorsement or recommendation of the companies or securities discussed herein. I am not an investment advisor and this is not an investment thesis. It is merely one part of the story, which I present for debate in hopes of determining all risks and upside potential. The disclosure at the end of this piece is critical to understanding the content of this document. Further, I frequently trade my positions and may buy, sell, or short the securities mentioned herein at any time, regardless of the facts or perceived implications of this article.

 

This week, SMSI is finally experiencing the technical breakout we’ve been waiting for. The timing coincides perfectly with the news that Sprint is now happy with the product and rolling it out aggressively.

For those who don’t have time for videocasts, here’s a quick summary, starting with the chart as I see it:

smith3

What’s so important about this week’s Sprint news is that it should catalyze a more-important move to profitability for SMSI, leading to strong EPS growth in 2019 and beyond for this fast-growing subscription service.

As a result of the news and breakout I’ve been a buyer this week (including this morning) and have no plans to day trade it. I’m focusing on the fundamental risk/reward with this one.

In the videocast below, I discuss the technical chart above (which is fairly self-explanatory), along with the fundamental justification. I also explain why traders, day traders, and investors should all enjoy a profitable run on this one.

Plus, I provide an update on RDCM for good measure. In a nutshell, Vickie Lonker, Verizon’s (VZ) vice president of product management and development said that the goal of the Verizon VNS Solution Bundles is making network services easier to consume by taking the most popular functions and creating templates that enable pre-packaged service chains.

That might be too technical for most to understand, but all you have to know is that she then said, “…service assurance is what ultimately makes all this work”.

That’s exactly what RDCM does… and it’s exactly what I believe RDCM is doing for VZ.

Cheers!

p.s. Yesterday was a crazy one for HMNY. On the heels of MitchGate (the data fiasco), we now have TedGate (the “we won’t need more dilutive funding” fiasco). Plus, they filed their 10-K. Lots to analyze and discuss…

…but I was doing more important things.

Specifically, I was focused on my volunteer gig, coaching distance runners from Miami Beach High School, as they competed at the Florida State District Championships. I’m proud to say that two of my boys established new personal bests (including a 4:39 for 1600 — basically a mile — run by a first-year athlete). My one female athlete advanced to the next round of the Florida State Championships!

VERY proud of those kids 🙂

So… needless to say, I’ll take a look at all the HMNY craziness sometime today.

 

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Disclosures / Disclaimers: I am long SMSI and RDCM. However, this is not a solicitation to buy, sell, or otherwise transact any stock or its derivatives. Nor should it be construed as an endorsement of any particular investment or opinion of the stock’s current or future price. To be clear, I do not encourage or recommend for anyone to follow my lead on this or any other stocks, since I may enter, exit, or reverse a position at any time without notice, regardless of the facts or perceived implications of this article.

I am not a financial advisor. Nor am I providing any recommendations, price targets, or opinions about valuation regarding the companies discussed herein. Any disclosures regarding my holdings are true as of the time this article is written, but subject change without notice. I frequently trade my positions, often on an intraday basis. Thus, it is possible that I might be buying and/or selling the securities mentioned herein and/or its derivative at any time, regardless of (and possibly contrary to) the content of this article.

I undertake no responsibility to update my disclosures and they may therefore be inaccurate thereafter.  Likewise, any opinions are as of the date of publication, and are subject to change without notice and may not be updated. I believe that the sources of information I use are accurate but there can be no assurance that they are. All investments carry the risk of loss and the securities mentioned herein may entail a high level of risk. Investors considering an investment should perform their own research and consult with a qualified investment professional.

I wrote this article myself, and it expresses my own opinions. I am receiving no compensation for it, nor do I have a business relationship with any company whose stock is mentioned in this article. The information in this article is for informational purposes only and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.

The primary purpose of this blog/forum is to attract new contacts with professional industry expertise to share research and receive feedback (confirmation / refutation) regarding my investment theses.

19 thoughts on “Videocast — SMSI Technical Break Out!  Plus, an update on RDCM

  1. FYI I prefer reading to videos generally. I still haven’t found the time to sit down a watch you previous video post. I just open my wordpress app on my phone and read a few paragraphs at a time in between real life. Following the markets is my hobby (Econ BA’87) and surveying the land, husband, dad is my priorities. Example I’ll read your posts in the car while waiting on my daughter. Watching your video post require my old eyes to look at a big screen NOT a phone. I got my text size large on my phone. I’m not sure of the age of your followers but as you hit your fifties and latter their is nothing one can do about aging eyes that like larger text/video. Hopefully I find time sometime soon to watch both videos.

    Like

    1. Thanks for the feedback. Videos are sometimes less time-consuming for me to make… and since I do this as a free service / hobby, I don’t always wish to write long missives. I’ll do my best to provide summaries of my videos going forward. Thanks again!

      Like

      1. As your subscriber base grows, video is the only way to address the sheer quantity of questions and comments you will receive, so blogs/articles will become reserved for topics you wish to address in more depth. A semi-solution could be 3-5 key points before a video (like SA articles) with the video start time beside each (easier viewing on small devices and helpful for shorter viewer durations).

        An auto transcription service could also be used to print a transcript of the video below it -Dragon Naturally Speaking is used by many professionals. A donation button on your site could be used to pay/fund some of your athletes to check the transcription against the video. I used to ski very competitively and was very thankful for any way to make some money between my busy work/study/training schedule. Just suggestions and you know where the delete button is if not your style.

        Great videocast once again – I bought some more SMSI this morning. Thanks!

        Like

      2. I get that. I hate writing, always struggled with writing in school. Transcription is a good idea. Also high school parents in my area have created tax deductible funding vehicles (even the local grade school parents did so). This is a way to fund certain items that the parent teacher group decide upon and also get a tax deduction. It’s the wealthy families that donated cash and the less well off donating time. I would be happy to send a check your school (just be sure it’s legal). My local high school also has parents who set up an athletic booster fund.

        Liked by 1 person

  2. Glad to see your frustration has paid off riding from $3.50 to $1.50. I’m in a similar position with MBRX and rode it down, grab the bottom, sold the spikes, made a nice profit and now have a nice core position. It is fun to do that with something you believe in.

    Love the analysis on “wait time”, sometimes that is more frustrating than losing money. Although I’m collecting 60% APR on my MBRX shrs right now which is fantastic.

    I haven’t added to SMSI yet as it was hard to time buying yesterday during work. Looking to double my position though.

    Like

    1. Just to be transparent and honest, I didn’t hold SMSI from $3.50 to $1.50 out of choice, loyalty, or nobility. I had just put out a big report on them and subsequently got placed under NDA. At that point, I found out that they were going to do a round of funding. So, I had no legal choice except to hold the shares. Otherwise, I would have sold and participated in the offering.

      Investing is not about being noble. It’s about making money (as long as it’s within the rules of law and ethics). We can be noble with the money that we make from this business. 😊

      Just wanted to provide some color…

      Liked by 2 people

      1. Nice color and man watching that funding train come at you must have been tough. I’d rather continue being surprised.

        I agree, I’m not going to put some over used Buffett quote here but all you are doing is trying to take other people’s money. I honestly had a hard time with the capitalistic piece of it over the past couple years. When I time a sell perfectly, I almost feel bad for those that I stuck with the bags. But hey it goes both ways.

        I have dramatically increased my charitable giving because of my investment activity in the past 2yrs. I’m still not where I would like to be but for the first year my tax form giving had 5 figures 🙂 I’m really liking the Fidelity Charitable program as I at least get to play and invest with the money a bit.

        Liked by 1 person

    1. I would rather teach you how to figure it out yourself. Simply look at the most recent quarter’s cash balance and then look at how much cash they are burning per quarter. It can often be a LITTLE more involved than that, but in most cases (including this one, that will give you the answer) 😉

      Liked by 2 people

  3. Was the drop from $3.50 to $1.50 related to the funding? The funding announcement I believe came out after the stock dropped to around $2.25.

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    1. In my opinion, it was the combination of negative reviews and the funding.

      What most investors don’t know is that the funding process was elongated (took about two months). The stock dropped during that whole time, leading up to the actual funding event. Totally normal in such situations.

      They should have gotten the process done much more quickly, but what’s done is done and they know. Lesson learned.

      Hope that helps. Cheers.

      Like

  4. Greetings, Mark. Great video and continued analysis of Smith Micro. Speaking of videos, one of the videos you put out ~ March 2017 was for Marin Software (MRIN). I assume you still own shares in that stock!?

    I myself have held on, as having both ESW Capital and the EVP of the company’s product/platform division buy shares at much higher prices, has kept me in the stock.

    Thirteen months later, you still think that company’s prospects for a buyout look as sexy as they did last year? [Highlights included: 1 Year R&D ~ equal to market cap, tax loss benefits, and a new Marin platform].

    I’m more excited about the prospects of AEHR and SMSI, but thought I’d bring this up as it’s always good to review a thesis 1-year later, especially now that prices are significantly lower.

    Like

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