October 29, 2014

Doug Kass sold majority of his Monitise shares

 I have sold most of my Monitise (MONIF) shares, principally as a result of the 15% advance (albeit from the lows) after Omega Advisors' Lee Cooperman defended the stock on [CNBC Show]"Fast Money Halftime".

I have consistently viewed Monitise as a potentially important and disruptive player in the mobile payments and banking industries. Given its leading market position, strong partners IBM , MasterCard and others, thoughtful stakeholders (Omega, Legg Mason, etc.)  and prospects for the potential of a rapid trajectory of sales/profits/cash flow, the ingredients for a home-run stock seemed to have been in place.

I have also characterized Monitise as speculative investment and said the stock should be appropriately weighted in portfolios. The company lives in a rapidly changing and innovative space in which the competitive landscape has the potential for an overnight transformation. Monitise is the back end of the solution in a game-changing industry and there is always the potential that its role will yield less returns than generally expected (in terms of average revenue per customer). 

The longer-term investment case for Monitise remains intact. But given that run-up, the news vacuum until the first half of 2015, the likelihood of persistent tax selling over the balance of the year and the aforementioned unpredictable stock market conditions, I believe (though I might be wrong) I will be able to replace my sold shares with lower-priced stock in the months ahead. 

VIA http://www.thestreet.com/story/12927581/3/where-the-sp-500-is-headed-why-i-sold-monitise-best-of-kass.html