Move Inc. (NDAQ:MOVE) is owner of Move.com and a series of other web portals designed to connecting real estate buyers and sellers, including Realtor.com - the official NAR (National Association of Realtors) portal. The stock, which was up to around $7 per share earlier in the year, is now on the rise again. So, is it a good time to buy? Let's take a look...

When looking at the macro picture surrounding the company, it is not difficult to see that there is trouble in the housing market. Rising interest rates make it more expensive to own a house because of the higher financing costs. More expensive loans end up pricing people out of the market, which reduces housing demand. The reduction in demand causes the price of houses to decrease, which is what we are currently seeing in many housing markets. The reduction in both demand and price are not good for realtors, as they must face both reduced demand for housing and a reduced commission (due to lower selling price). These two factors may decrease the deal flow seen at web portals like Move.com.

Since they operate an Internet portal as their primary business, we can partially qualify this thesis using Amazon's Alexa. This Alexa report shows the downward trend of traffic going to their main portal, Move.com. This reduction from a high of around 15 - 18 million visitors per day down to 8 - 10 million visitors per day is quite significant, and is likely at least partially attributable to the economic environment (since sales and marketing expenses were up during the same period).

There are also problems with the company itself - most notably, the fact that they don't make money (on a GAAP basis). According to their own 10K filing with the SEC:

"We have incurred net losses every year since 1993, except for modest net income in 2005, including net losses of $7.9 million and $47.1 million, for the years ended December 31, 2004 and 2003, respectively. As of June 30, 2006, we have incurred a modest net loss and have an accumulated deficit of approximately $2.0 billion ... certain business model changes that will require considerable investment with no assurances that our future financial performance will be enhanced by these new initiatives."

The most troubling issue is the fact that during the United States' largest real estate boom, the company was not only unable to turn a profit, but actually accumulated a $2 billion deficit! And now after the boom is (arguably) over, the company still retains an enterprise value (EV) of over $640 million. Even if the company is a clear market leader with an increasing share of the online real estate listings market (which is debatable), the company still faces both macro-economic and internal issues that it needs to resolve before becoming profitable. The company could also face antitrust issues relating to their exclusive relationship with NAR, assuming that the online real estate listings market continues to grow as fast as it is (expected to double by 2010). Finally, the company is in the process of changing its web portals, and the success of this depends largely on how well customers accept these new online destinations. Overall, it would be best to hold off on any investment in MOVE until the company achieves profitability and is able to demonstrate that it can drive traffic to its new portals.

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The daily digest is a new addition to the blog that highlights five of the most noteworthy forms filed with the SEC every day...

Ahold (NYSE:AHO)
On Watch for 8K Filings
The company is reportedly under pressure from hedge funds to break up the company and may be looking at a merger with Delhaize (according to Reuters), although many remain skeptical.

Eagle Materials (NYSE:EXP)
Form 4 Filing by Chairman
Chairman Laurence Hirsch revealed today that he has purchase 400,000 shares of the company's stock between $34.68 and $35.77 through the week. The stock is trading up over 12% on the news.

Imclone Systems Inc. (NDAQ:IMCL)
13D Filing by Carl Icahn and Co.
Carl Icahn disclosed a 14% stake in the company and said that he wants Director Kies to leave the Board of Directors. Shareholders recently re-elected Kies as Director while also electing Icahn as a Board member.

Marsh & McLennan Companies, Inc. (NYSE:MMC)
8K Filing Noting Putnam Valuation
Item 8.01 in the company's latest 8K filing notified investors that it was conducting a valuation of its subsidiary Putnam, citing several parties that were interested in a potential merger or acquisition of the division.

Palm, Inc. (NDAQ:PALM)
On Watch for 8K Filings
CNBC mentioned today that Palm is higher on takeover rumors. Any substance to these rumors would be found by looking for 8K material events filings or perhaps even insider buying.

Imclone Systems Inc. (NDAQ:IMCL) revealed today in a 13D/A filing with the SEC that Carl Icahn and Co. now own almost 14% of the company. The activist investor has been trying to replace the management and turn around the company for some time now. The stock continues to slowly decline as operating results fail to improve, while the company was unsuccessful in finding a buyer back in July. While the company is about even on the year, it has recently dropped from a high of $42 in May to its current levels of around $28 per share.

Carl Icahn believes that the problem lies with David Kies. In an attachment to this latest 13D filing, Mr. Icahn enclosed a letter asking the Chairman to immediately step down:

"Now that I am becoming a director of ImClone, I am asking you again for the good of ImClone and its stockholders to give up your position as Chairman of the Board. Given what I consider the sorry record of the Company under your watch, it is time for you to step aside and allow someone else to be elected. You have even admitted to me that the board has done a bad job. ImClone has been without effective leadership for almost three years.

You should recognize that your leadership of ImClone should come to an immediate end. The time has come for you to  peacefully  pass the baton to a successor who will be able to bring strong  leadership back to ImClone.  If you fail to do so, you will have thrown down the gauntlet and we will have to react accordingly."

Also in the letter, Carl Icahn noted several of Mr. Kies failures as Chairman of the company:

• ImClone has suffered as a result of its inability to attain the leadership position it should enjoy as an important biotechnology company.
• Commercialization has suffered, trials have not been sufficiently  pursued, the head and neck data was needlessly delayed, patent suits have been lost and the Company has not provided its stockholders the performance that they deserve.
• ImClone hired a President and CEO who was totally the wrong person for the position and it took the company many many months to recognize this and replace him. His replacement lasted only a few months. Now, ImClone has another interim CEO and his permanent replacement is nowhere on the scene.
• ImClone's meaningful lead relative to potential competitors has shrunk considerably and ImClone has suffered reversals such as the loss of the patent suit in the past week.

Clearly Mr. Icahn believes that many of the company's failures are attributable to Kies, which makes his removal necessary in order to unlock shareholder value. The activist investor is known for taking any actions necessary to accomplish his agenda. And with a 14% stake in the company, we can be sure that Mr. Kies will not remain with the company for very long. With new management and leadership, perhaps this company can turn itself around and once again establish itself as a leader in their market. It is definitely a stock worth keeping an eye on!

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