1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies
Barel Karsan
Barel Karsan

New Frontier Media Finally Sells

October 16, 2012 | About:

New Frontier Media (NOOF) has been on the Stock Ideas page for more than two years now, but it's time has finally come. The company received a buyout offer (that its board is on board with) for $2.02/share.

Unfortunately, the buyout offer isn't much higher than the stock's May 2010 price, so for some investors this investment could be considered a failure. In the interim, however, the price fell to about half of it's buyout offer price. So for those investors who stayed patient or added shares when the market was pessimistic, this investment was a fantastic success.

My outcome was somewhere in between. I did buy a good chunk more shares as they fell near the $1 mark, but I also sold out after the price rise that followed the Longkloof offers (which topped out at $1.75/share).

There were a lot of tops and turns in this company over the last two years. Business operations turned south, buyout offers were received and rejected, the CEO was fired for cause, and board members bickered over which of them is more shareholder friendly.

Each of these events left me scratching my head as a shareholder: When should I give up? Should I buy more? Should I buy back in? These were all very tough questions for me, which made me think maybe I should stick to simpler situations. While I don't feel very good having not owned some shares as this latest buyout offer was announced, I remember feeling relieved to have been able to exit this company when I did.

Good luck to the guys tasked with turning this thing around!

Disclosure: No position

About the author:

Barel Karsan
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 3.2/5 (10 votes)


Please leave your comment:

GuruFocus Mobile App

User Generated Screeners

waltervaldiviaLow PB 200 mio Cap
fgoldwynProfitable Value
alexhcyuInsider Buy 3 Months
blohmventuresprice/earnings power. p/fcf
blohmventuresprice/earnings power
blohmventureslow coverage sp500 pb and p/fc
blohmventuresminimal coverage but in sp500
teichman82interesting 2

Select portfolio(s):

  • Loading...

Why you are interested?

Your selection and notes will be stored in your portfolio.

Login to add portfolio
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)