Thoughts on VIACOM, DISCOVERY, and VIRGIN GALACTIC

VIACOM: This New York based media company currently trades at twice its book value has steady growing business with average profitability over the past five years. Growing debt by the billions with steady cash flow generation able support the growing debt.

MY: The now $41 billion media company just lost 40 billion or half of its market capitalization last week primarily because of a hedge fund was forced to liquidate its position on the company’s stock. Given the big correction, this may be an opportunity to get in and pick up some shares for PURE SPECULATIVE PLAY. 

DISCOVERY: Another media company that suffered a nearly 50% crash on its stock after a hedge fund had to force liquidate its investment on its stock. Company trades at same valuation per book value as Viacom. The company generates much less than revenue than Viacom though albeit exhibits similar profitability and balance sheet characteristics. 

MY: Viacom similar trade on this. Play the bounce don’t fall in love with it.

VIRGIN GALACTIC: The once high flying aeropace company has now fallen from the space by 50+%. Instead of sales growing to the sky, it is actually the opposite. revenue for 2021 dropped to $200,000 from nearly $4 million the previous year (a red flag sign) albeit the company remains debt free and loaded with $600 mil cash—the company’s capex falls into the mid-teen millions. at 11 times book value, however, there’s just too much hype in this stock at this point of time. The company is still bleeding at this point of time and likes to dilute its shareholders whenever it can. 

MY: highly speculative play. Pass.

*NOT AN INVESTMENT ADVISE. BUY YOUR STOCKS AT YOUR OWN RISK. DO YOUR OWN DUE DILIGENCE.

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