This week's sign of the apocalypse: Pamela Anderson's Star: A Novel is No. 13 on The New York Times best-seller list.
Written with -- actually, mostly written by -- ghostwriter Eric Shaw Quinn, the narrative follows its protagonist, Star, as she rises from humble beginnings to grace the pages of Mann magazine, ultimately to reach the pinnacle of fame on the hit TV show Lifeguards Inc. At least it's not autobiographical.
Asked about her literary inspiration, Anderson said she didn't read novels, but prefers books about dreams, past lives, and elves. But she's reached out to the masses here, saying of her book, "You can either read it on the beach or the toilet. It's not like it's a difficult read." And her breasts are characters, too. And that's not even a joke.
In today's Motley Fool Take:
- TiVo Spins Round and Round
- Discussion Board of the Day: Index Funds
- Oracle's Still in Hot Pursuit
- Quote of Note
- Put Me in, Coach!
- More on Fool.com Today
TiVo Spins Round and Round
So you find yourself on a spinning carnival ride. You're feeling dizzy. Your quivering stomach reminds you that you're feeling queasy, too. But then the carnie manning the ride belts out, "Do you want to go faster?" and you find yourself hollering for more. You're risking your lunch for the sake of speed, but you do it anyway, sucker.
But as the positive g-forces push against you, take a look around, and you'll find TiVo
The company behind the digital video recording devices has tacked on nearly a million new subscribers over the past year, and it's looking to tack on a million more during the last half of 2004. But there is a price to this breakneck speed, and it is revealing itself in wider losses and lower price points to draw in new subscribers.
Last night, the company that earned a recommendation last year in our Motley Fool Stock Advisor newsletter posted a wider loss of $0.13 a share for its fiscal second quarter as revenues climbed by 49% to hit $39.8 million.
Its partnership with DirecTV
Yet the company is ready to take some near-term pain to achieve its lofty goals of couch potato domination. It has rolled out a bargain-priced recorder with a $99 price point that should play well in the company's growing frontline of retailers that includes Best Buy
Will moving more machines make TiVo a better business? The company actually loses money on them as the recorders sport a negative gross margin. The real gravy lies in the subscriber revenue: Folks sign up for monthly plans to keep TiVo updated with the TV programming.
TiVo can stomach the spins. While operating losses are going to widen significantly in the current quarter, the company's cash-rich balance sheet can handle the princely acquisition costs. The company will be fine as long as the more aggressive TiVo and its bargain pricing strategy are indications of massive assimilation rather than a desperate move to cater to a niche market that may be tapped out.
So feel free to hold your nose over the next few quarterly bottom lines. They are bound to be putrid. Yet if the growth is sincere, keep an eye on TiVo's eyes; it may be ready to ditch the carnival for bigger thrills.
Discussion Board of the Day: Index Funds
Are you a believer in index investing? Is it a more rewarding approach than that of singling out individual stocks? What's a reasonable expense ratio for an index mutual fund? All this and more in the Index Funds discussion board.
Oracle's Still in Hot Pursuit
Oh, have mercy. Will it never end?
Last night, database maker Oracle
Fellow Fool W.D. Crotty and I have dueled over the prospects for Oracle, and the merits of a deal for PeopleSoft were key to each of our arguments. (You can read both cases and vote here.)
Frankly, I think Oracle CEO Larry Ellison should persist as long as he thinks he's getting a fair price for PeopleSoft. After all, the combination of the two firms would generate a mountain of high-margin maintenance revenue from software customers are totally dependent on.
But there are plenty of hurdles to completing the deal, not the least of which is the Justice Department's lawsuit, which claims the deal is anti-competitive. Court proceedings in the case came to a close on July 20, and Judge Vaughn Walker's decision is said to be imminent.
Published reports have suggested that Oracle's strong courtroom performance makes a victory for the database king possible where such an outcome was once considered a long shot. That, folks, makes for great theater. But it means nothing to Oracle and PeopleSoft investors.
Yeah, that's right. Nada.
Even if Oracle wins, it's highly unlikely that it will be able to spend a dime on PeopleSoft till after another key lawsuit that would force PeopleSoft to drop its poison pill defense is settled. And were Oracle to win that tussle, Ellison would have to convince former protégé Craig Conway to talk with him about a deal. Thus far, Conway has proved intractable.
The major problem with this brouhaha is that it's distracting investors from the potential profits in the stocks of both firms. After all, Oracle's offer for PeopleSoft as of this writing represents a 21% premium, and a combined company could churn out loads of cash for years to come. And, with or without PeopleSoft, my estimates show Oracle's cash flow growth could juice its enterprise value over 40% over the next three years. Those are decent returns, especially in a stock market that has all but treaded water this year.
For more Fool coverage of Oracle's bid to buy PeopleSoft:
- The duel over Oracle's prospects remains a tight race.
- Even with the PeopleSoft debacle, Oracle turned in a strong fourth quarter.
- Oracle's courtroom challenge to the Feds over its bid for PeopleSoft has been entertaining.
- But some don't like the brouhaha. They need to act more like owners.
Fool contributor Tim Beyers aims to acquire some Oracle shares, but he'll have to wait since we've got a pretty strong disclosure policy here at the Fool. Fortunately, he thinks the shares will still be on sale next week. He has no plans to acquire PeopleSoft stock. You can view Tim's Fool profile here.
Quote of Note
"Success is the ability to go from one failure to another with no loss of enthusiasm." -- Sir Winston Churchill
Put Me in, Coach!
The constituency of the Standard & Poor's 500 Index is a pretty elite bunch. As the name implies, the exclusive club really does consist of just 500 notable public companies. And while it may not be a paparazzi magnet the way it would be if a U.S. Supreme Court judge or a Green Bay Packers season ticket holder passed away and left a vacant seat behind, it certainly has its investing implications.
This time it was Charter One Financial
Replacing a bank with a leather goods specialist? You're missing the point. You may not know much about the Sara Lee
Yet the S&P promoted from within, as Coach has been, until now, a member of the S&P MidCap 400 Index. That creates a domino effect of promotions, as specialty retailer Urban Outfitters
If you own an index fund or participate in the S&P 500 through the exchange-traded Spider
But now that Coach will be getting some more attention from institutional investors, it may be worth getting up to speed on the company and its financials. The company wrapped up a solid fiscal 2004 with solid growth prospects heading into the new year. Here are some stories that we have written this year about the company's heady results:
Longtime Fool contributor Rick Munarriz can't recall ever owning a Coach product. Then again, he's also upset that he wasn't called up to fill the void in the S&P FoolCap Index! He does not own shares in any of the companies mentioned in this story.
More on Fool.com Today
In The 80-Cent Dollar Dilemma, Whitney Tilson explains how to protect your portfolio in uncertain times.... Seth Jayson thinks the nocturnal mind offers insight into a Fool's investing beliefs in I Dream of Paris (Hilton).... In Why I Won't Invest in Biotech, Tim Beyers swears off biotech stocks, but not for the reason you'd expect.... David Meier shows how to make stock list work for you in Inside the Value of Stock Lists.... In Tomorrow Version 2.0, Rick Munarriz says the future of online rentals is just getting started.
In other news:
- Is Deb Well-Dressed?
- Chico's: A Retailing Steamroller
- This Sport Comes Up Short
- Hang Up on This Stock Tip
For a list of all our stories from today, see our Today's Headlines page.