Hello Friends! Glad to be back again with another idea...sometimes I think I am a never-ending source of ideas...and I am trying to sort things out....hope you can! Anyway, as always, remember to do your own due diligence on all of these and any ideas you pick up on the internet...(Do I sound like your mother?)....and use an investment advisor liberally.
This pick is a bit intriguing to me. I am tempted to break my 25 position and stretch my margin to unbelievable levels (but as I write this I know I won't do that!) As I write, Netsmart Tech (NTST) is trading at $17.60, up $1.54 or 9.60% for the day.
According to money.cnn.com "snapshot", NTST "...is engaged in the design, development, marketing and implementation of management information systems for the behavioral healthcare industry."
I will give you the link for the latest quarterly report that I found on NYTimes on the web, but you may need to register for this free service (as I have done) in order to open it: NTST earnings report. Net Income for the quarter ended September 30, 2003, was $1.5 million or $.33/share (diluted), compared to $202,000, or $.05/share (diluted). Revenue was $7.1 million in 2003 third quarter vs. $6 million in the same quarter in 2002.
Looking at Morningstar.com "5-Yr Restated" financials, we can see that revenue growth has been good but not consistent from $13.2 million in 1998 to $25.6 million in the trailing twelve months.
Earnings/share have also been all over the board ranging from $.04/share in 1998, up to $.63/share in 2000, dropping to $.08/share in 2001, and increasing to $.70/share in the trailing twelve months.
Free cash flow, while small, has been positive and appears to be growing with $2 million reported in 2000, $0 in 2001, $4 million in 2002, and $6 million in the trailing twelve months.
Balance sheet wise, at least as listed on the most recent Morningstar.com screen, shows $11.8 million in cash, more than enough to cover both the current liabilities of $10.4 million and the small $1.3 million in long-term debt. In addition, NTST has $10.2 million in other current assets.
Looking at "key statistics" on Yahoo.com, we can see that this is truly a micro-cap stock with a market capitalization of $85.35 million. The trailing p/e is 26.15. No PEG is listed...are there even good estimates going forward? Price/sales is at 3.02.
Yahoo lists only 4.81 million shares outstanding with 4.10 million of them that float. There are, as of 1/8/04, 318,000 shares out short, representing 7.76% of the float or 1.828 days of trading volume.
No cash dividend is reported on Yahoo and no stock dividends or "splits" are listed.
Again, I am NOT a technician, but let's take a look at the point and figure chart for NTST on stockcharts.com: At the least, this looks bullish with the stock rising above its support level. I defer to others with more experience on the graph...
I will TRY to maintain all self control and not buy any shares of this...I just don't have room on my plate for another piece of "pie"....my mother always said "my eyes were bigger than my stomach." You know how that goes.
Anyway, thanks for stopping by! Please come back and visit again and always, remember always, do your own research and due diligence on all of the information you might pick up here and elsewhere on the internet!
Regards!
Bob