"Trading Transparency" CMN

Hello Friends! I just wanted to update you on a trade I just executed in my Current Trading Portfolio. A few moments ago, I sold 55 shares of my 255 shares of Cantel Medical (CMN)at $25.91. This was my third sale and thus, my goal was a 90% gain. These shares were purchased 6/4/04 at a cost basis of $13.36. Thus, my gain worked out to $12.55/share or 94%. On July 8, 2004, I sold 75 shares at $25.20 (prior to the split) which had a cost basis of $20.03 (again pre-split) for a 25.8% gain (fist sell point about 30%), and then on 12/20/04, I sold 55 shares at $33.60 (pre-split), which had a basis of $20.03 (again pre-split) for a gain of $13.57/share or 67.7%. (60% is the second sell-point in my strategy).

Thanks so much for stopping by! And you know what a sale at a gain means?! I have that nickel in my pocket again and I am on the lookout for a new position (as long as I am not at my 25 position goal!)

As always, remember I am an amateur investor so please consult with your professional investment advisors! Have a great Thursday everyone!

Bob

February 2, 2005 Pacer Intl (PACR)

Hello Friends! Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice. I know I probably don't need to remind you, but I am an amateur investor, so please consult with your professional investment advisors prior to making any investment decisions based on information on this website.

Looking through the list of top % gainers on the NASDAQ, I came across Pacer Intl (PACR). I do not own any shares nor do I have any options on this stock! PACR closed at $22.24, up $2.70 or 13.82% on the day. According to the Yahoo "Profile" on PACR, Pacer "...is a non-asset-based North American logistics provider. The Company provides its logistics services from two segments, wholesale services and retail services."

What drove the stock higher today, was the 4th quarter 2004 earnings report which was released yesterday after the close of trading. For the quarter ended December 31, 2004, total revenue increased 16.3% to $530.8 million from $456.3 million last year. Net income increased to $17.0 million, from $11.4 million the prior year, a 49.1% increase. On a diluted earnings per share basis, this quarter PACR came in at $.44/share, up from $.30/share, a 46.7% increase. These were great results and the stock moved higher accordingly.

How about longer-term results? Taking a look at the "5-Yr Restated" financials on Morningstar, we can see that revenue has been steadily growing from $194 million in 1999 to the $440 million in the trailing twelve months. Earnings, which are only recorded since 2003, have increased from $.82 to $1.08 in the trailing twelve months.

Free cash flow has also been solidly positive with $7 million reported in 2001, increasing to $47 million in the trailing twelve months (TTM).

The Morningstar balance sheet looks adequate with no cash reported but $234.1 million in other current assets, as opposed to the $180 million in current liabilities and the $171.6 million in long-term debt.

How about "valuation" questions? Taking a look at Yahoo "Key Statistics", we can see that this is a mid cap stock with a market capitalization of $829 million. The trailing p/e is reasonable (imho) at 18.05, with a forward p/e (fye 26-Dec-05) of 16.23. Thus, the PEG is nice at 1.11, and Price/sales even cheaper at 0.42.

Yahoo reports 37.28 million shares outstanding with 27.60 million of them that float. Of these, as of 1/10/05, there were only 673,000 shares out short representing 2.44% of the float or only 1.834 trading days of volume.

No cash dividend, and no stock dividends are reported on Yahoo.

What about "technicals"? Taking a look at a Stockcharts.com Point & Figure chart on PACR:

we can see that the stock bottomed late in 2002 at around $9.50, then climbed to $22.50, where it ran into resistance, broke down, and dropped to $13.50 in late August 2004. The stock has been moving higher since then to its current level around $22.24.

So what do I think? Well the stock just came out with a FABULOUS earnings report. The Morningstar five year record looks solid. We don't have much of an 'earnings' record however, although free cash flow looks nice, and the balance sheet is favorable. Valuation questions appear reasonable with a p/e that appears to be significantly lower than the current growth rate. In addition, the chart looks positive if not perfect, to me.

Well I guess in conclusion I like this stock and would consider purchasing some shares if I were in the market to do that! I am waiting on my Cantel which is close to a sell point now....maybe soon?

Thanks again for stopping by! Please remember that I am an amateur investor! If you have any questions or comments, please feel free to email me at bobsadviceforstocks@lycos.com.

Bob

"Trading Transparency" SRX

Hello Friends! Well that nickel didn't last long in my pocket! I just picked up 150 shares of SRA Intl (SRX) at $59.60 in my trading account. I will try to post more on them later. Their numbers look good, they just game out with a great earnings report...apparently they are a defense contractor...so not in the high tech area...as such. More later!

Thanks again for visiting!

Bob

"Trading Transparency" QSII

Hello Friends! I just wanted to keep you up to date on my "Trading Portfolio". A few moments ago, I made my fourth sale of Quality Systems (QSII); I sold 30 shares of my remaining 120 shares at $68.51. I had acquired these shares at a cost basis of $31.00/share on 7/28/03 and thus had a gain of $37.51 or 121%.

As you may recall, my sale points are 1/4 of position at 30%, 60%, 90%, 120%, and then 1/4 at 180%, 240%....etc.

I sold my first 100 shares at $38.86 on 8/19/03, 50 shares at $41.67, and 30 shares at $58.61. This stock has been good to me!

And now....I am able to buy another position...so I shall be on the look-out and shall keep you posted! You know how that nickel burns a hole in my pocket!

Bob

Update "EVST"

It is ironic that I posted that terrible comment about Everlast (EVST) and now today, the stock is flying! As I write, EVST is trading at $8.30, up $1.62 on the day or 24.25%!!!

Apparently, EVST announced3 new licensees and the stock jumped!

I do not change anything I wrote however. Individually, I cannot predict news about a stock. That is NOT what my thinking is about. I am looking for certain stocks that have consistent growth and great fundamentals. I will absolutely miss loads of stocks that turn out to be great investments.

I hope all of you bought shares of EVST anyhow, and made a bundle. It is just not a stock that fits into my strategy. Even today!

Bob

A Reader Writes "Is EVST a 'buy'?"
A "Xanga" buddy of mine, "stories" has written and asked me about Everlast (EVST). He wrote:

EVST, a buy?

'the contender' boxing reality tv show will air in march. also, a solid name of a brand. Everlast.

First of all, as stories knows, I am an amateur investor, so please consult with your professional investment advisors before taking any action based on information on this website. Furthermore, I am not psychic, so I cannot predict the future price action of any particular stock! But what I can do is sort of run it through my own screens and see how it fits into my perspective on stock market investments! So bear with me...

First things first. EVST closed on 1/28/05 at $6.68, down $.12 on the day or a loss of (1.76)%. According to the Yahoo "Profile", Everlast (EVST) "...designs, manufactures and sells a diverse collection of consumer products, encompassing apparel and sports products, principally under the Everlast trademark."

As I think that stories knows, my first step in evaluating a stock is to look at the latest quarter and see if revenue and earnings are positive and improving. On November 15, 2004, EVST reported 3rd quarter results. Revenue was down at $15.8 million, compared to $17.7 million the prior year. The company had a net loss of $(.2) million or $(.08)/basic share, compared with a net income of $.1 million, or $.03/basic share in the same quarter in 2003. This is not my kind of stock....but that doesn't mean the price might not appreciate in the future...but let's look further!

(sorry but the punching bag doesn't enlarge when you click on it!). How about longer-term results? For this, I turn to the "5-Yr Restated" financials on Morningstar. Here we can see actually a steadily increasing revenue from $24.5 million in 1999 to $65.6 million in 2002. Revenue has been down slightly since then and has not been growing in the way I like to see it grow.

And earnings? Well, this has been erratic to say the least, with $.31/share in 1999 increasing to $.44, and then dropping since the to a loss of $(.36)/share in the trailing twelve months per Morningstar. Not very encouraging imho.

And free cash flow? At least EVST is not burning up its cash, but they are at ZERO for free cash flow in the trailing twelve months.

And balance sheet? This looks adequate with $.5 million in cash and $23.7 million in other current assets, as opposed to $18.1 million in current liabilities and $32.8 million in long-term liabilities. At least they don't look insolvent imho.

(again, that boxing ring doesn't enlarge lol). What about "valuation"? Here I like to use the Yahoo "Key Statistics" on EVST. We can see that this is a tiny company with a market cap of only $20.91 million. No trailing p/e and nobody has estimates for a forward p/e. Price/sales is very cheap at .33.

Yahoo reports only 3.13 million shares outstanding with 1.70 million of them that float. Of these, as of 1/10/05, there were 15,000 shares out short representing a short ratio of only 0.044...so that doesn't look significant. No cash dividend nor any stock splits are reported on Yahoo. BTW, I do not own any shares nor do I have any options or short positions in this stock!

How about "technicals"? If we look at a EVST Point & Figure chart from Stockcharts.com:

we can see that this stock has been trading in a fairly narrow range between $6.00 and $2.25 between 1999 and early 2004. Recently, it has broken through resistance and does appear to be moving higher. Overall, the chart does look nice! (at least recently.)

So what do I think? Well, it doesn't fit my strategy, plain and simple. The last quarter showed decreasing revenue and a loss, the last twelve months is a loss, the revenue hasn't increased for a couple of years. Free cash flow is zip, and the balance sheet is marginally o.k.

Valuation I guess is reasonable. And the chart does at least recently look good. So those are the good things about the stock. Will the stock price go higher? It might. And if you buy some shares you might make some money. You could make a ton of money. But as for me, I shall be looking for stocks that fit my own criteria a little tighter.

Thanks so much for posting that question! You have been a loyal reader and follower stories, so I apologize if I didn't "pull any punches" on EVST!
Have a great week!

Bob

"Looking Back One Year" A review of stock picks from the week of December 8, 2003





Hello Friends! Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice. As always please remember that I am an amateur investor, so please consult with your professional investment advisors prior to making any investment decisions based on information on this website!

I have been asked "How are you doing with your strategy?". Well, first of all, I can refer people to my current trading portfolio, but as far as how all of these "picks" are doing, I use this device, my "Weekend Review" to assess the progress or lack of progress in the stocks I have selected for this blog. As I always like to point out, this review is a little more than a year out at this point, and I try to let you know how those stocks are doing at this time. This evaluation assumes a "buy & hold" strategy, while in practice, I buy a stock and will sell quickly at an 8% loss, or sell parts of the holdings slowly as the stock price appreciates!

On December 8, 2003, I posted Armor Holdings (AH) on Stock Picks at a price of $26.35. AH closed on 1/28/05 at a price of $42.95, for a gain of $16.60 or 63%.

And how are they doing now?. Well, on October 29, 2004, AH announced 3rd quarter, 2004, results. Revenue for the quarter ended September 30, 2004, came in at $256.8 million, a 186.2% increase over last year's $90.9 million. Net income was $23.9 million or $.70/share, vs. last year's $6.1 million or $.22/diluted share.

On December 9, 2003, I posted Comtech Telecommunications (CMTL) on Stock Picks at a price of $30.89. CMTL closed at $32.48 on 1/28/05 for a gain of $1.59 or 5.1% since posting.

And how is CMTL doing? CMTL reported 1st quarter 2005 results on 12/7/04. For the three months ended October 31, 2003, net sales came in at $56.1 million down slightly from $56.3 million the prior year. However, net income was $7.1 million, or $.46/diluted share, an increase from the $5.7 million or $.37/diluted share the prior year. Overall, a mixed results; a slight decline in sales but a slight increase in earnings. I would rather see an increase in both!

These were the only two stocks posted that week. (I did a 're-post' of Polymedica (PLMD), but will not be including it in this discussion). So how did we do on these two stocks? In a word, great! AH was up an impressive 63%, and CMTL was up a more modest 5.1%, for an average appreciation of 34%.

Remember, that I AM an amateur, past performance is NO guarantee of future performance, and it "helps to be lucky"! If you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com.

Bob

A Reader Asks "What about Fairfax Holdings (FFH)"

Hello Friends! Thanks again for stopping by. Before calling it a day, I checked my email and had a question from a reader about Fairfax Holdings (FFH). This is a financial services holding company...and my ability to assess this particular investment is limited. So I am going to refrain from making any assessment at all!

The kind of review I like to do involves utilizing companies that have easily read Morningstar.com reports. All I can see is that Fairfax has had the same revenue, $4 billion, in 2001 through the trailing twelve months. Not much growth there at all.

Earnings and p/e are nice. No information on Morningstar on free cash flow or balance sheet.

So I will excuse myself for the Amateur that I am and say I cannot tell you much of anything! It could be a terrific investment...but then again, I don't really know. I find enough stocks with numbers I can get my arms around that I don't even look at all of these others (which might be terrific investments) at all!

If you have some comments you would like to make about this one, please go ahead and comment right here under this post!

Bob

January 27, 2005 Affymetrix (AFFX)

Hello Friends! Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice. As I do over and over around here, I need to let you know that I am an amateur investor and you need to check with your professional investment advisors prior to making any investment decisions based on information on this website. If you have any questions or comments, please feel free to email me at bobsadviceforstocks@lycos.com.

As I posted earlier, I sold a portion of my Cooper (COO) stock at a nice gain, so it "entitled" me to purchase a new position. My strategy of portfolio management is simple. I plan on having up to 25 positions. When I sell a stock on bad news...either it hit a sale point on the downside, or something fundamental is announced that isn't very promising, I try very hard to "sit on my hands" and not replace that issue. On the other hand, if I sell a portion of a holding on a gain, I use that as an "internal market signal" from my portfolio, that is a signal that it is ok to add a position to my holdings (as long as I am under 25). On the downside, I plan to go down to just 6 positions which would be my minimum portfolio. Fortunately, I haven't tested that portion of my strategy yet!

Once I knew I was back in the market for a stock purchase, I turned to the list of top % gainers on the NASDAQ. Affymetrix (AFFX) was on the list. Currently, as I write, it is trading at $40.62, up $4.29 or 11.81% on the day.

According to the Yahoo "Profile" on Affymetrix, the company "...is engaged in the development, manufacture, sale and service of systems for genetic analysis for use in the life sciences."

What drove the stock higher today was the 4th quarter earnings results reported yesterday, 1/26/05, after the close of trading. Sales rose 21% to $107.7 million for the quarter up from $89.2 million the prior year. Quarterly income came in at $27.1 million or $.41/share, up from $16 million or $.26/share last year. However, 1st quarter guidance was for $.20/share on $90 million of revenue with full-year 2005 results of $1.12/share on $405 million in revenue. (The 2004 full year results just reported was $.74/share on $300.8 million). The street liked the whole announcement, and the stock moved higher!

How about longer-term? Looking at a "5-Yr Restated" financials on Morningstar, we can see the steady revenue growth from $109 million in 1999 to $327 million in the trailing twelve months.

Earnings, which were 'negative' in 1999 at $(.54)/share, turned positive at $.24/share in 2003 and $.60 in the trailing twelve months.

Free cash flow, which was a negative $(60) million in 2001, turned positive in 2002, and was a postive $28 million in the trailing twelve months (TTM).

The balance sheet also looks solid with $181.7 million in cash and $93.3 million in other current assets, plenty to cover both the $84.9 million in current liabilities and the $157.4 million in long-term liabilities.

How about "valuation"? Taking a look at Yahoo "Key Statistics" on AFFX, we can see that the market cap is a "large cap" level at $2.48 billion. The trailing p/e is rich at 55.43, the forward p/e is a bit better (fye 31-Dec-05) at 33.12. The PEG (5 yr expected) is moderate at 1.65, and the Price/Sales is also rich at 6.76. This stock is NOT selling at any bargain levels!

Yahoo reports 60.96 million shares outstanding with 60.70 million that float. Of these 11.58 million are out short (12/8/04)(!), representing 19.08% of the float or a short raio (12/8/04) of 15.953 days. We might be seeing a bit of a "squeeze" today with the announcement of fairly good results.

Yahoo reports no cash dividends for AFFX, and the last stock split was a 2:1 in August, 2000.

How about "technicals"? If we look at a "Point & Figure" chart from Stockcharts.com:

we can see that this stock was actually trading LOWER between April, 2002 and late July, 2002, when it dropped from $30.00/share to a low of $14.00/share. Since then, the stock has been forging ahead nicely to its current level of $40.69. The chart doesn't really look too "over-valued" imho.

So what do I think? Well the stock did make a nice move today, the earnings report, although apparently a little under 'street' expectations was solid, the guidance for the coming year was good as well. The short-selllers might just be scrambling to cover their shares....revenue has been growing nicely the last 5 years, the stock turned profitable and is growing its earnings, the free cash flow which WAS negative a couple of years ago has turned positive and the balance sheet looks solid. Valuation-wise, the stock does sell at a rich p/e and Price/sales although the 5-yr PEG isn't too bad being under 2.0.

Well, as you know, I liked it enough to buy some shares today! I hope it works out.

As always, if you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com.

Bob

"Trading Transparency" AFFX

Hello Friends! Well you know how that nickel ALWAYS burns a hole in my pocket? Well, sure enough, looking through the lists of stocks today, I came across Affymetrix, a genetics analysis corporation, that was performing well and appears to fit my "criteria" fairly well.

I went ahead and purchased 160 shares at $40.927 for my trading account. I will try to get back to all of you with a review ASAP. Just wanted to give all of you a heads-up of what I was doing! Hope it does better than my ASKJ which lasted a grand total of 7 days before hitting my 8% loss limit!

Regards!

Bob