May 14, 2013 - Market Foolery Podcast | Summary and Q&A

TL;DR

Hedge fund manager Dan Loeb urges Sony to spin-off its entertainment division, causing a surge in share price.

Key Insights

• 💨 Hedge fund managers like Dan Loeb add value by recognizing undervalued assets in companies and finding ways to unlock their potential.
• 👨‍💼 Sony's financial services segment is a significant profit driver, despite being overshadowed by its entertainment business.
• 👹 Japanese companies, including Sony, often resist outside shareholder influence, making it challenging for activists like Dan Loeb to enact change.
• 💗 Twitter's partnership with ESPN highlights the growing trend of second screen phenomenon, where users access social media while watching TV.
• 🚗 Twitter's mobile experience and its accessibility have made it a favored platform for social networking during TV viewing.
• 😘 Tesla's stock price surge is fueled by both positive quarterly earnings and a short squeeze due to high demand and low supply of shares.
• 👨‍💼 While Tesla's stock price may be considered overvalued, the company's future potential and business momentum are worth monitoring.
• 📱 The Facebook phone, HTC First, featuring the Facebook home interface, has received little enthusiasm from users, raising doubts about Facebook's mobile strategy.
• 📱 Pressure on Facebook to deliver results in mobile advertising will increase with disappointing reception of the Facebook phone.

Transcript

it's Tuesday May 14th welcome to Market fullery I'm Chris Hill joining me in studio today from mle 1 Jason Moser and from mle Full hidden jams Chief investment officer Andy cross good to see you guys J hello um we got a lot going on today we've got uh we got ESPN in the news we've got Twitter we've got Facebook we've got Tesla which apparently is a... Read More

Questions & Answers

Q: What does Dan Loeb propose Sony should do with its entertainment division?

Loeb wants Sony to spin off 15-20% of its entertainment division, which he believes will increase the company's market valuation by $600 billion.

Q: How much stake does Dan Loeb have in Sony?

Dan Loeb and Third Point own over a billion dollars worth of Sony stock, making his proposal significant.

Q: What is the main profitable segment of Sony?

Sony's most profitable segment is its financial services segment, which brought in 63% of operating profit last year.

Q: What is the market reaction to Dan Loeb's proposal?

Sony's share price surged on the news of Dan Loeb's proposal, indicating positive investor sentiment.

Summary & Key Takeaways

• Hedge fund manager Dan Loeb has urged Sony to spin off its entertainment division, causing a surge in share price.

• Loeb wants Sony to float 15-20% of the entertainment division, believing it will increase the company's market valuation by $600 billion.

• Sony CEO Kazuo Hirai has expressed little interest in the idea, but Loeb believes this is just the first step in his approach.