Shanda Games Limited (NASDAQ:GAME)

CAPS Rating: 3 out of 5

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Player Avatar SBeren (23.97) Submitted: 10/29/2009 9:50:37 AM : Underperform Start Price: $5.87 GAME Score: +81.55

Mark it Zero.

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Member Avatar Varchild2008 (83.93) Submitted: 11/3/2009 4:35:20 PM
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Mark what Zero? GAME or your CAPS Score after red thumbing GAME? :-)

Member Avatar SBeren (23.97) Submitted: 11/4/2009 4:55:45 PM
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How'd you get your score, have other people do due dilligence for you? Ok, here you go: GAME was spun off by SNDA. The day before it was spun off SNDA was worth (i forget exactly, but not important to make my point) say $3 billion. The day after GAME was spun off the combined companies were worth 2x what they were worth the day before! Furthermore, GAME is still a subsidiary of SNDA, so there's no point in owning GAME, might as well just own SNDA. Also, if you look at those two stocks, I think SNDA constantly trades/moves at a premium to GAME, as it should GAME might very well be a real company, but SNDA is playing a shell game here and was able to create billions of dollars in equity value out of thin air. Wake up!

Member Avatar Varchild2008 (83.93) Submitted: 11/5/2009 6:49:45 PM
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2 Analysts just came out this week with a $15 buy/outperform rating.

If SNDA is a buy in your opinion then by default so is GAME.

You can't say that CRUSH beverage isn't a buy if you believe Dr. Pepper Snapple Group is a buy...
You can't say Monster Energy Drink isn't a Buy if you believe Hansen Natural Corp is a buy....

What I mean is take any Large Cap Stock and slice out a chunck of the business to form 2 companys and you still have 2 companys. However.... What you have is 1 company heading in a different direction finding growth in a different area (SNDA) and the 2nd company (GAME) focusing 100% squarely on their Online Video Games business.

I heard an analyst wine that GAME has to pay an exhorbidant fee to SNDA to have their game's run on SNDA owned servers. However, SNDA owns GAME manages GAME and in essence.... they are almost paying the FEE to themselves.
C.E.O. just came out with an interest to expand internationally where they have very little exposure right now... So, there's tremendous growth. Given (CYOU)'s debut in the U.S with Dragon Oath.... (GAME) has a good chance to beat CYOU handily whenever they decide to debute a title.

Just saying that when you take a 16+ hit to your CAPS score then it's probably time to reconsider the red thumb.

Member Avatar SBeren (23.97) Submitted: 2/8/2010 10:41:51 AM
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First, you lost me at "2 Analysts". If there's one thing you ought to learn, it's that Analysts are the most pointless entities that exist. Your adulation towards them demonstrate just how naive you are.

Second, your softdrink comparison makes no logical sense in this context.

The fact that SNDA owns controlling interest of GAME makes a big difference about where the EQUITY (profits) will ultimately go to -- my bet is that it will go to controlling interests/owners (SNDA). Which, ironically, you provide evidence for in your above paragraph: "I heard an analyst wine that GAME has to pay an exhorbidant fee to SNDA to have their game's run on SNDA owned servers." Hello?!

And again, from what I said previously. Company SNDA was worth $X. Then it spun off GAME, and the combined market cap, overnight, doubled to 2X. If spinning off doubles value over night, then every company would be doing that! Wake up, or don't.

Besides, you're the one taking a 16+ hit to your CAPS score. Hopefully you weren't convinced of your delusions enought to trade actual money. Though, perhaps if you did, you learned a lesson of ignoring common sense at your peril.

Member Avatar mountain8 (< 20) Submitted: 3/2/2010 11:07:22 AM
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"If there's one thing you ought to learn, it's that Analysts are the most pointless entities that exist."

Hate to say it fellow, but you also are an analyst, As are most of the fools.

Member Avatar Varchild2008 (83.93) Submitted: 3/2/2010 5:05:53 PM
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SBeren
"The fact that SNDA owns controlling interest of GAME makes a big difference about where the EQUITY (profits) will ultimately go to "

First of all I don't agree automatically with analysts... especially since their 12 month targets are more like 12 minute targets...as they change them far too quickly for little reason.

Second... While GAME's GAMEs are run on SNDA servers.... The Premium Shop Cash of MIR I....MIR II... Legend of MIR III will be going to GAME.. only a portion of that revenue goes to SNDA by way of paying for the Servers...

There's a difference here you are completely ignoring... Growth in 1 game's revenue isn't just growth in SNDA... but growth in both companys.

Third.... Whenever GAME acquires new business.. such as buying MOCHI MEDIA.... they are opening new revenue streams that don't look to me like they have any growth for SNDA.

My beverage analysis is a good one.... If DPS splits in 2... You will have another set of managers running the 2nd portion and probably running it very differently than the 1st portion.... even though the 1st portion may own majority stake in the 2nd.

If the 2nd beverage company acquires a beverage company to add to their portfolio.. that is business for the 2nd that the 1st does not receive except through Share Price Growth out of the 2nd company.

SNDA is only getting SEVER Fees + it's investment in GAME as net revenue.... While GAME is free to get revenue from wherever they want except for using some other company's Servers.

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