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Penny Stock Heads up: Pouring GLU on your Mobile Phone

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March 29, 2009 – Comments (0)

GLU Mobile  (GLUU) is a global publisher of video games for Mobile Phones.  They have just announced an extension of their partnership with Activision Blizzard.  The penny stock trades off the NASDAQ.

Standard and Poors gives GLU Mobile a  SELL rating and a 50 cents a share price target.
GLU Mobile trades at 46 cents a share.

The recent announcement seems very intriguing from a penny stock, speculation, super high risk standpoint.  

1st:  Glu Mobile said they plan to become cash positive by the end of this year.

So... Based on their announcement of releasing 5 blockbuster Activision titles for phones using Android, Blackberry, Brew, J2E, and Windows Mobile through their respective online stores, could this be the catalyst to get this company cash positive?

Well.. The first way to tackle this company to detemine if it can be a viable company to invest in long term, is to determine if ANY company AT ALL is viable as a 100% exclusive Cell Phone mobile games company.

Unfortunately, I do not know of any.  Extremely tough to do any research on this industry :-(

What I do know is this:

1)  The Activision deal does not mention the PALM or IPHONE operating systems... *ouch*

But, I like that they mention Blackberry as the Blackberry STORM has been selling like hot cakes.

2)  Glu Mobile has been extremely busy when it comes to partnerships.  They have also recently announced a paternership with FusionOne, a company that produces the technology to transfer your mobile game data from 1 phone to another.  This allows gamers to upgrade their phones to a 3G phone without sacrificing their saved game data. 

3)  Insider Activity is BULLISH.  The entity that is selling off shares rapidly is a beneficial owner and I never consider those as insiders so much as 3rd party.  2 separate officers are listed on my screen as having bought a significant amount of shares this month.

4)  Statement from Activision Publishing's David Anderson shows that Activision truly believes in this company's quality of work.  GLU Mobile did work for them previously on Call of Duty: World at War mobile.

5)  GLU Mobile is bleeding earnings out the wazoo...  Hence why this company is super high risk.

6)  GLU Mobile has been reducing costs and expenses.   But, so did Midway before Midway went bankrupt.

I give the company's stock a BUY ratiing but that is entirely based on my belief that the company does become Cash Positive by the end of '09 due to the 5 Activision Titles + other Movie Based Games + the FusionOne partnership.  I see the possibility of Cash Positive Growth a lot better than Standard and Poors sees it.

Mobile Gaming is too intriguing to get cold feet even with SUPER HIGH RISKY Penny Stocks like (GLUU).  So... Who knows?  We shall see if GLU's share price pokes it's head above $1.00 in 2010 or not.

Of course... I couldn't care less about Standard and Poor's opinion or rating on any company cause they have been so mind numbingly wrong it is funny. 

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