Stock Picks Bob's Advice
Tuesday, 12 August 2003
August 12, 2003 Techne Corp. (TECH)
I first heard of Techne Corporation (TECH) at my stock club last year when one of the members presented the stock....and we owned it as a club for a short period. I do not currently own any shares nor do any members of my family.
TECH had a great day today closing at $32.08 up $3.65 or 12.84%. The stock moved on news of its earnings report which was released today. TECH "...is engaged in the development and manufacture of biotechnology products and hematology calibrators and controls which are distributed throughout Europe."
The earnings report, mentioned above, was for Techne Corporation's fourth quarter ending June 30, 2003. Net earnings were $12.6 million or $.31/share (diluted) compared with a loss of $303,659 last year or ($.01)/share (diluted in 2002.
Results for 2002 were adversely affected by an $11.4 million charge or $.27/share last year due to a settlement with Amgen, Inc.
Consolidated net sales for the quarter were $39,425,932 and increase of 11% from the year earlier sales results.
Morningstar.com shows that revenues have increased consistently since 1998 when $67.3 million in revenue, $90.9 million in 1999, $103.8 million in 2000, $115 million in 2001, $131 million in 2002, and $145 million in 2003.
Free cash flow has been positive if somewhat inconsistent with $8 million reported in 2000, $40 million in 2001, and $5 million in 2002.
The company is loaded with cash with $107.7 million reported, way more than the $11.9 million in current liabilities and $16.2 million in long-term liabilities combined. In addition, the company has an additional $28.6 million in other current assets.
Yahoo.com shows a market cap of $1.16 Billion, with 40.8 million shares outstanding and 38.3 million of them that float. No dividend is paid. The price/earnings is moderate at 36.97, there are 2.48 million shares out short as of 7/8/03. This is significant as it represents over 8 trading days of average trading volume of 296,000 shares.
With no debt and great earnings reported, I like this stock a lot. Not exactly cheap with the p/e of 36.9 but the stock looks nice on a growth basis. I don't have any cash to buy any now.....but...one never knows....On ne sait jamais!
(did I get my French right?)
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Monday, 11 August 2003
How are we doing? A look at the week of June 30, 2003
The week of June 30, 2003, was a relatively slow week for this site. We posted five selections that week starting with TransMontaigne, Inc. (TMG) which was listed on 6/30/03 at $6.48. TMG closed today at $5.50 down $.98 or down (15.1%).
July 1, 2003, we selected Choicepoint Inc. (CPS) at $36.14. CPS closed today at $37.34. This is a gain of $1.20 or a gain of 3.3%.
Three stocks were selected on July 2, 2003, to close out the week of June 30th for selections: Digital River (DRIV) at $21.69, Metrologic Instruments (MTLG) at $35.60, and Mid Atlantic Medical (MME) at $55.56.
DRIV closed today at $20.84, down $.85 or down (3.9%), MTLG closed today at $29.89, down (16.0%), and Mid Atlantic Medical (MME) closed today at $50.53, down $5.03, or down (9.1%).
The market was NOT kind to our picks of 6/30/03; we had (9.1%), (16.0%), (3.9%), and (15.1%). We had only one stock with a gain of 3.3%.
We will have to see how these stocks do long term, but if they were in our trading portfolio, we would have sold all which reached an 8% loss.
August 11, 2003 Possis Medical, Inc. (POSS)
Market is still trading sloppy today. Currently NASDAQ is up while DOW is down. Was the opposite way most of last week. Anyhow, here is a stock that I do own some shares (or did the last time I checked) in a managed account...
Possis Medical "...is a developer, manufacturer and marketer of medical devices." The stock is currently trading at $17.33, up $1.65 or 10.52%.
On May 13, 2003, POSS reported last quarter earnings of $.10 vs $.09 last year on a fully diluted basis.
Sales were at $14.6 million, up 36% from last year.
Most likely, stock is moving up (?) because we are approaching the 3 month period from last year...and thus new earnings.
Morningstar.com shows steady growth since 1998 of this small company with revenue of $6.1 million in 1998, $13.2 million in 1999, $20.6 million in 2000, $30 million in 2001, $42 million in 2002 and extrapolating the current quarter would get us just shy of $60 million for 2003.
Free cash flow has steadily improved the last few years from ($11) million in 2000 to ($4) million in 2001, $6 million in 2002 and $10 million in the trailing twelve months.
The Statement on Assets & Liabilities as reported in summary on Morningstar.com looks excellent. POSS has $30.1 million of cash on hand, more than enough to cover the current liabilities of $5.8 million and there are NO long-term liabilities reported.
This small company has a market cap of $279.1 million with 17.8 million shares outstanding and 17.5 million of those that float. No dividend is paid. There are 604,000 shares out short as of 7/8/03, representing 2.46 days of trading volume.
I like this stock a lot...there is one cautionary note...on 2/12/03 they were warning about possible earnings shortfall in the third quarter. (This was the quarter reported in May, 2003.) We are now in the fourth quarter of their fiscal year and I see no reason to believe that they will have anything but a good quarter....but we should know soon.
Thanks for stopping by! Bob
August 11, 2003 Trading transparency WebSense (WBSN)
On Friday, August 8th, with WBSN position down 7%, I went ahead and pulled the plug on our 200 shares at $18.83. Fundamentals haven't changed but the stock was trading so I had a nearly 8% loss and out it went. Will be updating the positions in the trading account and current prices ASAP. Regards! Bob
Friday, 8 August 2003
August 8, 2003 eSpeed, Inc. (ESPD)
O.K. got lots of stuff to do this afternoon so this may be my last post of the day. I mean I don't charge much for this service, so what do you expect? I should just stay glued to my computer screen and hash out stuff for you all day long? Just kidding!
Anyhow, came across what must be considered a dot.com again. Some of these are turning into real businesses! eSpeed, Inc. (ESPD) "...operates global interactive electronic marketplaces that enable the trading of financial instruments and other products instantaneously, more effectively and at lower cost than traditional trading methods." according to CNN.Money. ESPD announced today that they will be having their earnings "call" on August 14th..and I guess that anticipation of good results was enough to fire up the stock. ESPD is currently trading at $18.98, up $2.17 or 12.91% on the day.
Since we don't have the latest earnings...which are to be reported in six days...let's take a look at the latest REPORTED earnings....came out on May 12, 2003. First quarter revenue 2003 increased 13% from last year to $34.0 million from $30.0 million. Now get this, this is not their revenue, but contained withing this quarterly report is an indication of the volume of transactions....electronic "volume" (not revenue or earnings) was $6.8 trillion....yes TRILLION in the first quarter. (How many zero's is that?)....anyhow their net income was $.17/share compared to $.10 last year.
This is a very new company and Morningstar.com shows revenue of $34.7 million in 1999, $91.0 million in 2000, $125 million in 2001, and $139 million in 2002.
Free cash flow has turned positive (I guess you could stay they have stopped 'burning' cash...one of those problems for those miserable dot.com's): ($22) million in 2000, ($9) million in 2001, $49 million in 2002 and $37 million in the trailing twelve months.
Looking at the balance sheet as reported on Morningstar.com we find this company LOADED with cash with $175.1 million in cash on hand reported compared to a small $16.0 million in current liabilities and $100,000 in long-term liabilities.
Yahoo.com shows this company with a market cap of $929.0 million with 55.2 million shares outstanding and only 17.7 million of them float. No dividend is paid. The p/e ratio is a downright reasonable 21.02, and as of 7/8/03 there were 1.03 million shares or 5.8% of the float out short...a decrease from 1.06 million the prior month. This represents 2.49 trading days worth of volume.
Overall this is a very interesting, if slightly (?) speculative position. Much may depend on the results of next week's earnings report and if this stock is anything like other stocks...then stock may very well sell-off short-term on the earnings news if it merely hits expectations. But longer-term, this stock is very interesting, and if I had some free cash...lol...I would buy a few shares! Needless to say, I don't own any shares of this company nor do any members of my family!
Regards! Have a great weekend everyone. I will try to update the trading portfolio and stock prices later this weekend.
August 8, 2003 Emulex Corp. (ELX)
Hello Friends! Finally, a nice steady day in the market....so far....Looking at the lists of best gainers I came across Emulex. This was an old favorite of mine when I was still blindly investing in tech stocks before the bubble broke...and Emulex is still cranking out growth!
Emulex (ELX)is trading currently at $22.46 up $1.04 or 4.86% on the day. According to Cnn.money, Emulex "...is a designer, developer and supplier of a broad line of fibre channel host adapters, hubs, ASICs and software products that enhance access to and storage of electronic data and applications." It has been awhile (!) since I looked at stocks that did ASICs....hmmm...whatever they are!
The stock is up today after releasing an earnings report after the close yesterday. According to Yahoo.com 'news' on ELX, revenues were up 3% sequentially and 16% from last year, growing to a record $81.8 million. Non-GAAP diluted earnings per share were $.23 for the quarter up 44% from last year. (Non-GAAP also explained as 'pro forma'...I presume this involves continuing operations....but then again...I am not an accountant and would prefer to have a 'cleaner' number to work with.)
Morningstar.com shows sequential revenue growth from $59 million in 1998, $68.5 million in 1999, $139.8 million in 2000, $245.3 million in 2001, and $255 million in 2002. Extrapolating the current quarter's revenues would get us somewhere 'north' of $320 million in 2003.
The company is solvent, generating $39 million in free cash flow in 2000, $45 million in 2001, $80 million in 2002, and $78 million in the trailing twelve months.
Looking at the Assets and Liabilities as reported on Morningstar, we find that there is LOADS of cash with $393.7 million in cash reported....way more than current liabilities of $77.8 million and long-term liabilities of $215.0 million combined. In addition Emulex reports $142.5 million in other current assets.
Looking at Yahoo.com we find that the company has a sizeable market cap of $1.76 Billion with 82.3 million shares outstanding and 79.1 million that float. No dividend is paid. The p/e is a bit steep (for me) at 51.86 and there are 8.6 million shares out short as of 7/8/03, representing 4.10 days of average trading.
The stock looks nice but is not a big bargain. However if this current growth continues, this stock may well be positioned for a nice move upward and is deserving of your attention. Needless to say, I do not own any shares of this company.
Thanks for stopping by and be sure to visit often. If you like this site, be sure to link it to your site....if we can get some links like that...we will get noticed on Google...:). Drop me a line at email@example.com if you have any questions or comments!
Thursday, 7 August 2003
August 7, 2003 Jos. A. Bank Clothiers, Inc. (JOSB)
Not too many picks for our board today...Jos. A. Bank Clothiers does seem to fit the bill. JOSB had a great day along with some other retailers like Best Buy for it seems the consumer is still alive....even if he is not refinancing his house...he is spending at the Mall!
JOSB closed at $44.16 today, up $5.31 or 13.67%. According to CNN.Money, "Jos. A. Bank Clothiers is a retailer, cataloger, and manufacturer of men's tailored and casual clothing and accessories."
As I have mentioned elsewhere in the BLOG, retailers are often measured in terms of 'same store sales growth'. This allows an observer to assess whether the existing stores are providing the growth engine or whether the company is giving the 'appearance' of growth by opening new outlets while existing outlets are actually performing at a less robust pace. In this case, getting to the point!, JOSB reported that its total sales for the month ending August 2, 2003, increased 31.6% to a record $17.5 million compared to $13.3 million in July, 2002. More importantly, same store sales increased 19.4% (!), while combined catalog and internet sales increased 25.4%, when compared to the prior-year month.
Let me repeat for emphasis, JOSB reported same store sales growth of 19.4%. This is fabulous!
Last May 20, 2003, JOSB reported their latest earnings report overall and announced earnings per share of $.30 for the first quarter of 2003 compared with $.25/share for the same period in 2002. Total sales increased 11.6% to $62.3 million compared with $55.8 million in the first quarter of 2002. During the first quarter, comparable store sales increased only 0.6%.
Morningstar.com shows a steady growth in revenue from $172.2 million in 1998, $187.2 million in 1999, $193.5 million in 2000, $206.3 million in 2001, $211.0 million in 2002 and $232.8 million in the trailing twelve months.
Free cash flow has been at best erratic with $7 million in 2001, $(12) million in 2002, $12 million in 2003, and $(11) million in the trailing twelve months.
The company has plenty of liquidity with $1.4 million in casha nd $108.7 million in other current assets compared to $56.5 million in current liabilities and $27.4 million in long-term liabilities.
Yahoo.com shows that this stock has a relatively small $240.9 million market cap with only 6.20 million shares outstanding and 5.00 million that float. No dividend is paid. The p/e is a reasonable 24.53 and the price to sales is also quite reasonable imho at 1.11. As of July 8, 2003, there are 829,000 shares out short representing 3.32 days of average trading volume.
I like this stock as much for its steady revenue growth as the superb same store sales growth figure just repeated. The p/e is reasonable, the price/sales ratio is fair, and there aren't many shares outstanding suggesting lots of room for growth.
Thanks for stopping by and please leave me a note a firstname.lastname@example.org if you have any questions or comments.
Posted by bobsadviceforstocks at 4:23 PM CDT
Updated: Thursday, 7 August 2003 4:38 PM CDT
Trading Transparency Zoran (ZRAN)
Market came to a close today...Dow moved up 64.71 but Nasdaq down .50 to 1652.18. ZRAN closed at $24.24 down $1.22 on the day or 4.79%. By the time it got down to $24.69, I was down about 8.3% on my investment so out it went and we sold 200 shares to close out our position in our trading portfolio. I don't see any news to explain the drop...but when it hits our 8% loss...out it goes. Our only other stock in jeopardy is Websense (WBSN) keeping at a 5.77% loss in our trading account. WBSN closed at $19.20 today up 0.03 or 0.16%.
Wednesday, 6 August 2003
August 6, 2003 FTI Consulting, Inc. (FCN)
Yesterday I couldn't find any stocks that fit our criteria, now they are literally coming out of our ears. (What an analogy huh?) This REALLY must be some sort of bullish signal when out kind of stocks start showing up in droves in the top percentage movers....don't you think? Time will tell...
Anyhow, hopefully the last post for the day, phew, FTI Consulting, Inc. (FCN),is having a great day trading at $21.90 up $1.03 on the day or 4.94%. The graph of this stock looks horrendous with a slide from almost $40 in April to its current level just over $20. Quite frankly, browsing through the news, I don't really see why the stock is down...but let's concentrate on the fundamentals:
"FTI Consulting is a multi-disciplined consulting firm with practices in the areas of bankruptcy and financial restructuring, litigation consulting and engineering/scientific investigation." per CNN.Money.
On July 23, 2003, per NYTimes on the Web FTI reported OUTSTANDING financial results: for the quarter revenue was $94.5 million an increase of 137.4% compared with $39.8 million in 2002. Income from continuing operations grew 213.6% to $18.5 million from $5.9 million in the comparable period the prior year. On a per share basis, earnings on a diluted basis grew 144.4% to $.44/share from $.18/share last year.
Morningstar.com shows revenue growing from $36 million in 1998, $49 million 1999, $96 million 2000, $122 million 2001, $224 million in 2002, and $288 million in the trailing twelve months.
Free cash flow has grown nicely from $9 million in 2000, $31 million in 2001, $69 million in 2002 and $88 million in the trailing twelve months.
Assets and Liabilities look nice with $75.5 million of cash, enough to pay off current liabilities of $64.1 million, and $81.0 million in other current assets, more than enough to cover the long term debt of $29.8 million.
This is a relatively small company with a market cap of $871.7 million, 41.8 million shares and 23.4 million that float. No dividend is paid. The short interest is interesting as there are 7.64 Million shares out short (!) representing 32.6% of the float (!!). This represents 10.26 days of average trading. This is actually bullish for this stock as we may see a short "squeeze" where traders are frantically buying shares trying to cover their borrowed shares already sold.
Anyhow, only downside, imho, is the recent graph of the stock price. The large number of shorts on this suggests they see something I don't. But would suggest that this may represent an awesome buying opportunity. If I get some free cash, this might just be one to consider a new investment!
Regards to all of my friends!
August 6, 2003 Zimmer Holdings, Inc. (ZMH)
The market started off lower, then the bulls stepped in...will it hold? Anyhow, all of these GREAT companies are showing up on our screens.
I do not own any shares of Zimmer but my wife owns I believe 8 shares that are the result of a spinoff of Zimmer from Bristol Myers Squibb. Currently, Zimmer is trading at $49.79 up $2.49 or 5.26% on the day.
According to CNN.Money, Zimmer Holdings, Inc. (ZMH) "...is engaged in the design, development, manufacturing and marketing of orthopaedic reconstructive implants and fracture management products, including artificial knees, hips and other joints."
On July 23, 2003, Zimmer reported (per NYTimes on the Web) 2nd quarter results: Net sales increased 19% (14% adjusted for currency fluctuations) to $411 million. Net earnings increased 35% to $89.0 million, and diluted earnings per share increased 32% to $.45 vs. $.34 in 2002.
Morningstar.com shows a beautiful series of bar graphs representing annual revenues increasing from $861 million in 1998, $939 million in 1999, $1.04 billion in 2000, $1.17 billion in 2001, $1.37 billion in 2002 and $1.44 billion in the trailing twelve months.
This corporation is spinning off lots of free cash: $203 million in 2000, $117 million 2001, $187 million in 2002, and $232 million in the trailing twelve months.
The assets and liabilities look nice too with $33.4 million of cash and $541.3 million of other current assets balanced by $342.7 million of current liabilities and $93.4 million of long-term liabilities.
This is a large company with a market cap of $9.29 billion with 196.5 million shares outstanding with 195.8 million of them that float. There is no dividend, there are 5.84 million shares out short representing 3.0% of the float and 4.19 days of average trading.
Overall, this company looks like an excellent investment quite worthy of your consideration. Perhaps a conservative investment based on its size but the bottom line looks excellent and it fits our criteria!
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