Stock Picks Bob's Advice
Sunday, 14 September 2003
September 14, 2003 "How are we doing?" A look back on the week of July 28, 2003
It is Sunday again and we are facing another week of trading to commence in just a handful of hours. I think it is always helpful to see how our past picks have been performing. As this site develops (?), Maybe we can take a longer-term view. But for now, we have been checking up on our selections each weekend...with a trailing six week look.
The week of July 28, 2003, was fairly busy here with nine selections: Quality Systems (QSII) on 7/28/03, Coventry Health (CVH) on 7/29/03, Community Health (CYH) on 7/29/03, Charles River Labs (CRL) on 7/30/03, Guitar Center (GTRC) on 7/30/03, Chico's FAS (CHS) on 7/31/03, ManTech (MANT) on 7/31/03, United Online (UNTD) on 8/1/03, and Alliance Data Systems (ADS) on 8/1//03.
During the short period since we listed it, QSII has been an outstanding star both for this stock pick section and my actual trading portfolio. You can view my trading portfolio by linking to it via the main webpage http://bobsadviceforstocks.tripod.com
QSII closed Friday, September 12, 2003 at $43.21. We selected it on 7/28/03 at $30.67. This represents a gain of $12.54 or a gain of 40.9%.
Coventry (CVH) got slammed with a general downgrade of HMO stocks by a prominent analyst. It has been fighting its way back and closed on 9/12/03 on $52.20, down from its selection price of $55.77 on 7/29/03 by $(3.57) or down (6.4)%.
Community Health (CYH) is also in the health field but not as an HMO but as a hospital operator. It was selected on 7/29/03 at $19.79. CYH closed Friday, 9/12/03 at $22.55, for a gain of $2.76 or 13.9%.
Charles River Laboratories (CRL), a breeder and seller of specialty lab mice and animals, has not performed quite as nicely as some of the above. It was picked on 7/30/03 at $35.60 and closed Friday 9/12/03 at $31.80, a loss of ($3.80) or (10.7)%. CRL got hit on 9/2/03 after lowering their own outlook on growth in 2003.
Guitar Center (GTRC) struck a nice chord with us (ugh), when we selected it on 7/30/03 at $33.26. This stock closed Friday 9/12/03 virtually unchanged at $33.36 or a gain of $.10 for us.
Chicos FAS (CHS) was recently closed out of our trading portfolio with a 9% loss. However, we failed to make a timely purchase on CHS and waited until additional gains developed from our 'selection' before diving in. CHS was selected on 7/31/03 at $27.22. CHS has actually had a nice gain on this website closing at $31.23 on 9/12/03, a gain of $4,01 or 14.7%.
ManTech Int'l (MANT) showed up on the lists on 7/31/03 at $24.86. This IT company that emphasises National Defense closed on 9/12/03 at $24.00, a loss of $(.86) or (3.4)%.
United Online (UNTD) was picked on 8/1/03 at $33.64. This dial-up Internet access company closed on 9/12/03 at $37.51, a gain of $3.87 or 11.5%.
Finally Alliance Data Systems (ADS) was picked on 8/1/03 at $28.45. ADS closed Friday, 9/12/03 at $28.70. This was up $.25 or a small gain of .88%.
Assuming equal contributions into each of these investments, averaging the performances for the week by averaging the percentage changes yields for us a gain of 6.82% for the picks for the week of 7/28/03. Not too bad a performance at all!
Thanks for stopping by again. Please come back and visit often and consider leaving comments right here on the website...or email me at firstname.lastname@example.org if you have any comments or questions!
Friday, 12 September 2003
September 12, 2003 Hanger Orthopedic Group (HGR)
I am ready for the market to wrap up for the week! But before it does, I have found one more stock worth considering: Hanger Orthopedic Group (HGR). This NYSE issue, according to money.cnn.com, "...acquires and operates the practices of orthotists and prosthetists. HGR also manufactures & distributes custom-made and prefabricated O&P products." HGR is having a nice day today, trading, as I write, at $14.75, up $.65 or 4.61%.
On July 29, 2003, HGR reported their second quarter results for the three-month period ending June 30, 2003: Net sales for the quarter increased by $5.8 million or 4.4%, to $138.9 million from $133.1 million last year. Net income for the second quarter was $9.4 million or $.35/diluted share compared to $7.7 million or $.29/diluted share last year.
Morningstar.com shows a steady, if not awe-inspiring, increase in revenue from $188 million in 1998 to $347 million in 1999, $486 million in 2000, $508 million in 2001, and $526 million in 2002.
Free cash flow has been relatively steady with $(6) million in 2000, $44 million in 2001, $38 million in 2002 and $44 million in the trailing twelve months.
This company, like the previous on posted, has significant long-term debt: $13.7 million in cash, $173.6 million in other current assets vs. $47.7 million in current liabilities and $486.5 million in long-term liabilities. With the free cash flow holding steady, the presence of long term debt should not be significant.
Looking on Yahoo.com, we find this company with a reasonable (!) trailing p/e of 10.76. The market cap is a 'smallish' $306.60 million with a PEG ratio of 0.82. No dividend is paid. There are 607,000 shares out short representing 3.00% of the holders.
This is indeed an interesting story especially with the very reasonable valuation and steady growth. Personally, I would rather stick with companies with FASTER revenue growth..and would pay a premium in p/e for this. Also, I would be happier if the debt was a little lower. Anyhow, with the downright cheap valuation, this stock may very well be an excellent choice in here.
September 12, 2003 Scientific Games Corp (SGMS)
Hello Friends! Thanks for stopping by. It looks like the market is taking a rest in here...with a small correction as it digests the latest statistics and looks for direction. Last couple of days, I haven't seen many on the most advancing list to meet our criteria here. However, Scientific Games looks like it may fit the bill.
Currently SGMS is trading at $11.55, up $1.66 on the day or 16.78%. According to money.cnn.com, SGMS is "...a provider of services, systems and products to both the pari-mutuel gaming and instant ticket lottery industries."
On July 24, 2003, according to the NYTimes on the Web, SGMS reported their second quarter results: revenues increased 13% to $128.8 million from the $114.3 million reported in the second quarter of 2002. Pre-tax income increased 111% to $19.6 million in the second quarter of 2003 from $9.3 million in the same quarter in 2002.
Looking at Morningstar.com, we find a steady growth in revenues from $159 million in 1998, $211 million in 1999, $299.9 million in 2000, $440.2 million in 2001, and $455.3 million in 2002. Extrapolating the current quarter would get us over $500 million in revenue in 2003.
Free cash flow has been improving nicely the past several years per Morningstar: $(14) million in 2000, $16 million in 2001, and $39 million in 2002.
The assets/liabilities picture is not quite as pretty as some of the ones we review but with the improving free cash flow, this may not be as big a problem: $34.9 million in cash and $96.4 million in other current assets vs. $84.9 million in current liabilities and $405.4 million in long-term debt.
According to Yahoo.com (have you noticed the new format on the Yahoo financial statements?), the market cap of SGMS is $680.54 million. The trailing p/e is a reasonable 10.99. Price/sales is low at 1.22 as well. There are 60.12 million shares outstanding with 36.80 million of them that float. No dividend is paid. There are 1.96 million shares out short...representing 5.32% of the float or 3.765 trading days to cover.
Except for the relatively high level of long-term debt, this stock looks nice. The p/e is low, the growth is consistent, the free cash flow is expanding, and there are plenty of shares already sold that need to be covered. You might well do worse than buy a few shares of this company!
Thanks for stopping by and be sure to visit often!
If you have any comments or questions, please feel free to comment right here on the website or email me at email@example.com
Thursday, 11 September 2003
"Trading Transparency" CHS
On September 10th, in the midst of the downturn of the market, my CHS stock in my trading account hit a 9.4% loss. I sold the stock as planned even though I love their numbers, their same store sales, and their outlook. This kind of discipline is tough to execute but necessary to develop long term. I will check the stocks today to see if we need to add any to our list of picks. Bob
Monday, 8 September 2003
September 8, 2003 Hi-Tech Pharmacal Co. (HITK)
O.K. it is late in the day and the NASDAQ is on fire. Our stocks are up and looking at the lists of gainers we have found a couple of new candidates for review. I have already listed Merit below (MMSI), so let's now take a look at Hi-Tech Pharmacal Co. (HITK). HITK is having a nice day today, trading at $28.75 as I write, up $2.46 or 9.36%.
According to money.cnn.com Hi-Tech "...develops, manufactures and markets over-the-counter, prescription and nutritional products. The Company also produces sterile ophthalmic, otic and inhalation products and provides contract services." I currently do not own any shares nor does any member of my family.
On July 16, 2003, according to the NYTimes on the Web, HITK reported their fourth quarter results for the quarter ending April 30, 2003. Revenues for the quarter were $10.9 million, a 14% increase from $9.59 million the prior year. Net income increased 11% to $1.27 million, or $.16/diluted share vs. $1.15 million or $.15/diluted share for the same period last year.
Looking at Morningstar.com, we find that revenue has steadily increased from $23.3 million in 1999, $26 million in 2000, $29.6 million in 2001, $33.3 million in 2002, and $47.4 million in 2003.
Free cash flow while small remains positive at $3 million in 2001, $3 million in 2002, $4 million in 2003. Assets and liabilities look excellent with $15.6 million in cash per Morningstar, more than enough to cover both current liabilities of $7.5 million and long-term liabilities of $1.3 million.
Per Yahoo.com, trailing p/e is 35.53 with a price/sales of 4.63. This is a pretty small company with 8.35 million shares outstanding and 6.50 million of them that float. The Market Cap is $241.9 million. There are 1.962 million shares out short representing 18.83% of the float (!) or 1.962 trading days of short shares. This is an increase from 1.20 million shares for the prior month (July, 2003). No dividend is paid.
This stock looks very nice. I like the recent growth and the past growth is consistent and steady. The price isn't cheap p/e-wise, but the oppportunities are quite large considering the small size of the current company. I am completely out of any money to buy shares myself, but this might be one you would like to consider.
Please contact me at firstname.lastname@example.org if you have any questions, comments, or words of encouragement!
September 8, 2003 "Trading Transparency MMSI"
After reviewing Merit (MMSI), I decided that I wanted to purchase some shares. I first sold a few things in my son's account to get him 50 shares then reviewed my trading account and did the following: I sold 50 shares of CLSR at $24.27, 50 shares of FIC at $60.15, 25 shares of SBUX at $29.03, and 50 shares of TTWO at $38.10, and with the proceeds purchased 200 shares of Merit Medical Systems (MMSI) at $23.25. Sometimes a fellow has to do what he has to do! Anyhow, that's a quick update. I now own some shares of MMSI. Bob
September 8, 2003 Merit Medical Systems, Inc. (MMSI)
Welcome back to my weblog. Sounds like one of those black and white Count Dracula movies huh....should say something like "Velcome back to my Veblog"...oh well, maybe I am a better stock-picker than comedian....Today the market is up. I was on Yahoo chat last night and I told everyone I thought the market would be down....maybe predicting market moves isn't my forte...Anyhow...how about Merit Medical Systems, Inc. (MMSI) today? MMSI is having a wonderful day today trading at $23.10 up $1.89 or 8.91% on the day.
According to money.cnn.com, Merit "...develops, manufactures and distributes disposable medical products for use in the diagnosis and treatment of cardiovascular disease."
On July 23, 2003, Merit reported second quarter results for the quarter ending June 30, 2003. Results, according to NYTimes on the Web were revenue for the quarter of $34.6 million up 20% from last year's $28.8 million. Net income was a record $4.2 million or $.28/share up 56% from last year's $2.7 million or $.18/share.
Morningstar.com shows Merit with a very nice steady increase in revenue starting at $68.4 million in 1998, $78.0 million in 1999, $91.4 million in 2000, $104.0 million in 2001, $116.2 million in 2002, and extrapolating the current quarter we should get somewhere north of $130 million in revenue in 2003.
Free cash flow has been solid with $1 million reported in 2000, $14 million in 2001 and $13 million in 2002.
According to Morningstar, Merit has $16.4 million in cash, almost enough to cover both the current liabilities of $13.9 million and the long-term liabilities of $3.2 million combined. In addition, they are reported to have $36.0 million in other current assets.
According to Yahoo.com, Merit has a market cap of $442.41 million with 19.15 million shares outstanding and 17.47 million of them that float. There are 761,000 shares out short, representing 3.032 days of average trading volume. I am finding it hard to believe who might want to short this stock....The trailing p/e is at 29.46, a little rich, and the price/sales is at 3.25. Yahoo reports estimates of $.76 this year and $.89 next year.
I like this stock a lot. Honestly. I do not own any shares...but would be happy to buy some if I can figure out WHERE I will get the money lol. I cannot own everything!
Thanks again for stopping by. Please visit often and share this URL with your friends. If you have your own website, I would be HONORED to have you provide a link to this site. Regards!
Sunday, 7 September 2003
"How are we doing?" A look back on the week of July 21, 2003.
We were busy picking stocks this week. On July 21st I selected Simpson (SSD) at a price of $40.75. SSD closed on 9/5/03 at $44.14, a gain of $3.39 or a gain of 8.3% to date. DSP Group (DSPG) was selected on 7/21/03 at $25.23. Currently, as of 9/5/03, DSPG is at $28.10, a gain of $2.87 or a gain of 11.4%. Finally, on 7/21/03, IDEXX Lab was selected (IDXX) at $38.29. As of 9/5/03, IDXX was trading at $41.60, a gain of $3.31 or a gain of 8.6%.
July 22, 2003, was a day for two selections: Cognizant Tech (CTSH) at $30.22 and Vital Images (VTAL) at $21.66. CTSH closed on 9/5/03 at $38.77, a gain of $8.55 or a gain of 28.3%. VTAL closed at $23.54 on 9/5/03 for a gain of $1.88 or a gain of 8.7%. Recall that these gains or losses are all over a period of only 5 weeks.
On July 23, 2003, only QLTI was selected at $15.39. QLTI closed on 9/5/03 at $13.51. This represents a loss of $(1.88) or (12.2)%.
On July 24, 2003, Columbia Sportswear (COLM) was selected at $52.00, Sierra Healthcare (SIE) was selected at $27.09, and Fair Isaac (FIC) was picked at $55.42. As of 9/5/03, COLM closed at $51.90 for a loss of $.10 or a loss of (.2)%. SIE closed at $20.55 for a loss of $(6.54) or (24.1)%. FIC closed at $59.99 for a gain of $4.57 or a gain of 8.2%.
Finally, on 7/26/03, actually on a Saturday, I wrote up Zoran (ZRAN) which closed the prior day at $27.28. Currently ZRAN closed on 9/5/03 at $25.50 for a loss of $(1.78) or (6.5)%.
In summary, during the week of 7/21/03, I made ten selections which during the five subsequent weeks resulted in six stocks with gains ranging from 8.2% to 28.3% and four stocks with losses ranging from (.2)% to (24.1)%. The average for the ten issues was a gain of 2.99%. Overall, not too bad for a short period of time we have observed these issues.
Thanks again for stopping by! I hope the above was helpful. I try to be objective as I assess these issues and like to look back and see how they are initially doing. It will be interesting to look back on them after six months or a year!
Posted by bobsadviceforstocks at 12:33 AM CDT
Updated: Sunday, 7 September 2003 9:45 AM CDT
Saturday, 6 September 2003
September 6, 2003 Interpore International Purchase price
Looking through the past week's activity, getting ready to post an update, I realized I didn't post a price on the BONZ posting on 9/4/03. Since I DID purchase shares that same day, I will use my purchase price of $17.50 as our price for the posting. Thanks for bearing with me! Regards again to all of my friends and visitors here! Bob
Friday, 5 September 2003
September 5, 2003 "update"
Stocks are selling off mostly in response to the lousy job report with the loss of 93,000 jobs....but mostly the stocks sell off because they are overextended. I do not see any new stocks that fit our screening....so have a great weekend everyone....Bob
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