Pink Sheets

Level 3 (website) is not on the pink sheets, but sometimes I think it should be. For years I got burned by this company until I learned from the late Ben Keaton [pause for moment of silence] how to deal with Level 3. Ben died instantly in a $440,000 car on a San Diego speedway. It was tragic, but it sure beats most other ways of dying, if you're gonna go.

Level 3 is like the Great Pumpkin in the old Charlie Brown comic strip. It routinely disappoints investors despite whatever inevitable success it may eventually have. So you buy it at a point of extreme disappointment and sell it at at a time of great hope. In the last cycle, I bought at an average $1.65 and sold at $2.23. A 35% gain over less than a month's time (the quick timing was pure dumb luck, thanks to the E911 ruling).

Their July 2005 results were disappointing, as usual. They essentially treaded water, with no signs of improvement, slowly losing money, with large debts maturing in the distant future. If serious improvements don't show up, the equity will get even more extremely watered down at that time, so it gets risky to continue playing around with the stock. The company will survive: these guys are masters of financial wizardry.

The stock will need to hit $1.5 for me to look at it again.