Phrenzie.com

A few days ago, Hansen Natural (HANS) took an 11% hit in the stock price. I was floored. I was hoping that the price would initially pull back a little, but it easily passed through my limit price and down another 9%. Ugh!

So I immediately checked the news for anything, anything at all. What I found was an analyst’s reaction to the shareholder meeting.

I was both confused and happy.  Confused that an analyst would drop estimates based on what appeared to be an incredible lack of substantive or, at least, quantifiable information (or maybe he did channel checks, got insider info, etc.).  Hansen’s CEO said that sales were disappointing in the last two weeks of May.  What the news services did not report was that sales were still ahead of last year.  Couple that with commentary that Hansen’s Monster brand is continuing to take market share away from competitors.  Add on that the energy category, when including all sub categories, is actually growing.  The offset is that it’s core customer, blue collar workers, are having a hard time in this economy.  But I think this is somewhat mitigated by: 1) a smaller, more affordable can that’s been selling very well, and 2) the potential from international expansion, which my wife says is a VERY smart move.

I was happy because it represented an opportunity to invest.  I revisited my cash flow models and realized that my growth assumptions were still lower than Wall Street’s.  Hansen’s stays on top of its distribution channel (its business) and the CEO is the one who fields most of the questions on the business (rather than the COO or CFO).  As an analyst, I love to see these (among other things, of course).

So I could be dead wrong.  Stock could go down another 10+%.  But I really believe that this company is solid for the mid-term, at least: tight balance sheet, dreamy cash flows and growing market share.  To this last point, I have some buddies in the extreme sports racket, who tell me that Monster is a well-respected brand among the fans and athletes.  That’s perfect for street cred.  Btw – I bought more of HANS after it flew through my limit price.

After years of lazily wondering why TIVO (the company and its stock) never did well, despite having a brand that’s embedded in what it is (DVR), like Kleenex is to tissues, I realize why.

It’s not just the fact that the MSOs (multple system operators or major cable companies) offer DVR.  It’s the fact that the major TV networks offer replays of the shows, in their entirety, online, coupled with the fact that many more people are watching video on their laptops.  You don’t need the extra cost of paying for TIVO.  You cost is wading through the network commercials.

The fact that I don’t have cable doesn’t really matter any more, since some of the cable networks offer delayed programming online too, although not as complete (really wished American Chopper was online).

So all this gave me insight as to why TIVO’s stock sucks (NASDAQ: TIVO).  The malaise began well before the networks began putting much of their content online.  After all, TIVO was a high flyer in the dotcom boom J.  Since the bust, it’s traded in the low single digits to the low 10s.

Online video from the networks is laced with advertising. 

But what surprised me is that I’m still tolerable of the ads, although not as much as on TV.  I keep wanting to skip but the freaking cursor won’t adjust at all, except backward…ugh!  I’d be cool with an ability to see the ad on the side rather than being forced to wade through the full 30 seconds. 

But that’s what’s interesting…the content is so compelling that I’d bide my time through the commercial.  Any other video site showing non-quality programming wouldn’t work.  So if a buddy sent me a link to a funny Veoh video, I wouldn’t waste the time waiting for the commercial to end.  But because I know the Office and 30 Rock are good shows, I’ll force my way through it. 

UPDATE:  Despite a record profitable quarter, TIVO stock didn’t budge as investors were hoping for a little more (actual dollar value didn’t change much, from $8.10 to $8.60 the day after earnings release, but % change increased to a high of 7% the next day, but settled back to 4% as of May 30).  Thanks Larry for the post.