Forget Facebook IPO: Buy Penny Stock of SuperMedia (SPMD)

We’re about 30 days away from the super-hyped Facebook IPO and the hype is starting to trickle down to social media penny stocks like SuperMedia (NASDAQ: SPMD). A trusted local marketing advisor for small to medium-sized businesses across the U. S., SPMD earned a 2012 Industry Excellence Award for their SocialEze. On that announcement, shares in the penny stock closed just below the HOD of $2.01 gaining 16.96% on average volume. Oh yeah, and SuperMedia is also the largest yellow pages directory publishers in the U. S. when measured by revenue.

Social media companies are going to be in the investor spotlight more than ever over the next 30 days. The Facebook IPO price is going to set the tone for how social media companies are valued in the future. Yeah, thousands of articles are going to be published about Facebook’s debut over the next couple of weeks. The thing is that giant super company is bound to have an enormous impact on penny stocks. Take SuperMedia for example: They recorded $1.64B revenue for 2011, yet their penny stock, SPMD, has a market cap of just 30.94M. Hmmmmm.

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SPMD Stock Snap Shot:

52-Week High
(Apr 27, 2011): 5.95
52-Week Low
(Oct 3, 2011): 1.16
50-Day Moving Average: 2.37
200-Day Moving Average: 2.45

Avg Vol (3 month): 84,524
Avg Vol (10 day): 20,983
Shares Outstanding: 15.47M
Float: 9.07M

% Held by Insiders: 19.56%
% Held by Institutions: 62.50%
Shares Short
(a/o Mar 30, 2012): 2.18M
Short Ratio
(a/o Mar 30, 2012): 26.10

Unless your living under a rock,  everyone knows that Facebook is the most popular social media site in the universe. You probably have heard that the second most popular site is Twitter. Well, for a single user, easy enough to handle, but for the small to medium-sized business, SuperMedia’s SocialEze enables these businesses to establish relationships with consumers through social media. The big benefits SPMD offers is there automated tip posting, integration of business content and regular consultation with a social media expert, at a competitive price.

SPMD became an independent public company when Verizon Communications completed the spin-off of their shares to Verizon’s stockholders. Since the boom in social media, the SuperMedia team has taken an innovative approach to match local businesses priority requirements to reach consumers efficiently with easy-to-use functionality.

The company offers promotional solutions for businesses like the Superpages directories,, SPMD‘s digital local search resource on both desktop and mobile devices, the network, a digital syndication network that places local business information across more than 250 websites in both English and Spanish, and SuperMedia’s Superpages direct mailers, as well as social media, digital content creation and management, reputation management and search engine optimization.

 SuperMedia (SPMD) Stock Price History

    High   Low    
Fourth Quarter $ 4.24 $ 1.16
Third Quarter 4.25 1.49
Second Quarter 6.76 3.31
First Quarter 12.63 5.40
    High   Low    
Fourth Quarter $ 10.86 $ 4.52
Third Quarter 21.10 9.05
Second Quarter 46.90 18.29
First Quarter 44.45 34.04

As of February 21, 2012, there were approximately 185 holders of record of SPMD common stock.

The Social Media Money Flow:

Digging deeper into the 10-K of SuperMedia, if not for a one-time $1B impairment charge to write down goodwill, SPMD has positive operating income to the tune of $407 million compared to a operating loss of $96 million for 2010.  That’s a half-billion dollar improvement. Yes SPMD has outstanding debt obligations of $1.745 billion,but virtually 100% of it isn’t due until 2015.

2011 revenues increased by 39.6% compared to 2010 while selling expenses decreased by 7.4%, cost of sales decreased by 2.4%, increased 11.1% ($22 million),  and depreciation/amortization decreased by 7.5%. Continuing onward, interest expense decreased 18.3%, reorganization items expense decreased 60%. The most aggressive of moves made in 2011 was the gain of $116 million related to the early extinguishment of a portion of SPMD senior secured term loans.  SuperMedia utilized $117 million in cash to prepay $235 million of the senior secured term loans.

To view the SEC filings of SPMD, click here.

Bottom Line: Who really cares what the Facebook IPO stock price is or when it comes out when social media penny stocks like SPMD are lying there just waiting to be taken. Hey – $164B in revenue on a 9 million float for a penny stock that had incredible growth in 2011, has a monopoly-like grasp on small to medium business promotional presence, and …. and…. and…. was a $47 stock with less revenues in a tougher economic period just two years ago.

Debt – Yes they have debt but not an excess amount of debt and they are in the midst of one of the biggest IPO’s in the last decade which is in their sector, industry, neighborhood. Add SPMD to your list of penny stocks to buy and watch the share price multiply in this massive social media company that isnt Facebook.


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