Directed Electronics Stock

POLKOHOLIC

Directed Electronics (DEIX) hitting new 52-week low's

for those who dont know: DEIX is Polk Audio's parent company. DEIX acquired Polk Audio this past summer i believe.

http://finance.yahoo.com/q?s=deix

whats up with this stock?

nadams

Now's the time to buy!

shack

There are some fundimental issues with the Co. that could explain the downturn. They are heavy into the automotive side and may be linked with their problems. The Tech sector is also experiencing a downturn of late for a double slam. DEI makes both Sirrius and XM gear. There was thought that the two would merge which would be good for DEI but that appears to be dead and may have affected investors. The company was an IPO in late 2005 and the price of the stock is often inflated as people want to get in early, then they see it is not going to skyrocket so they unload to move elsewhere. The acquisitions also have a dilutive effect on earnings.

Bottom line... It is a conusmer automotive and electronics co. which is very suseptible to swings in price based on current economic data. It is relatively new to the market with not much finanical history. It is thinly traded so it is difficult to keep the price propped up and a a couple of sellers can affect the price if they get out of the shares.

It may very well be a good time to buy, but it could be a bumpy ride.

Jstas

In addition to what shack said, DEI spent alot of capital in the past year to year and a half buying up a bunch of companies. That can drop the value of a stock because new aquisitions need time to pan out and let the dust settle down before actual profit is realized. In addition to the large number of purchases, DEI bought quite a few companies is dire straits. These companies are either in recievership or not profitable and posting losses. Those losses will affect DEI's bottom line, especially if DEI assumed any debt in the aquisition. If that bottom line is affected, it will affect stock price.

DEI will not go back up in stock until they start showing bigger turnarounds in thier problem companies. It's thier good companies like Polk Audio that are keeping them afloat right now. I give them another year and if stuff doesn't start to turnaround, they may start selling off some of teh lesser performing assets or outright liquifying them and splitting the branches of that asset up among the other assets.