Stock Picks Bob's Advice
Monday, 28 July 2003
July 28, 2003 Quality Systems Inc. (QSII)
Hello Friends! Some of you may have bumped into me on Yahoo Stocks...love to stop by and chat and even play tunes...or some may have come by after seeing a post on Delphi. Whatever the case, WELCOME! Thanks for visiting and I hope this discussion is helpful and makes your visit worthwhile.
Was scanning the percentage gainers again today and came across Quality Systems, Inc. This company, according to Cnn.Money website, "...develops and markets proprietary healthcare information systems that automate medical and dental groups practices."
QSII is having a nice day today in the market. Currently, it is trading at $30.67 up $3.75 or 13.93% on the day. They are rising as most have recently on earnings news.
They reported today that revenues for their first quarter (ending June 30, 2003)...were $16.3 million, an increase of 33% from $12.3 million last year. Net income was $2.27 million, an increase of 40% from last year's net income of $1.6 million and on a fully diluted basis, $.35/share this year vs. $.26 last year.
Morningstar.com shows a steady growth in revenue from $31.2 million in 1998 to $33.8 million in 1999, $36.4 million in 2000, $39.9 million in 2001, $44.4 million in 2002 and extrapolating the current quarter we would get about $64 million in 2003.
Free cash flow shows steady improvement from $3 million in 2000, $5 million in 2001, $8 million in 2002 and $10 million in the trailing twelve months.
Balance sheet is very clean: $33.1 million in CASH more than enough to pay off the current liabilities of $16.9 million and $19.9 million of OTHER current assets with NO long-term liabilities reported.
This is a SMALL company with 6.16 million shares outstanding and 3.50 million that float with a market cap of $165.9 million per Yahoo.com. There are no dividends. Only 97,000 shares are out short representing less than an average trading day.
The trailing p/e is a reasonable 24.45 and considering that the company has NO debt and $5.92/share in cash, this is a beautiful picture and deserves consideration. In fact, I will review my own trading portfolio.....and think about buying some shares! I do not as I write own any shares of this company.
Regards again....and have a great week everyone!
Saturday, 26 July 2003
July 26, 2003 Zoran Corporation (ZRAN)
As I have posted earlier and elsewhere, yesterday I sold off my shares of EELN and purchased shares of Zoran in my trading account. Let me review this company with you.
Zoran closed yesterday at $27.28 up $3.78 or 16.10% on the day. According to CNN.Money, Zoran "...develops and markets software, integrated circuits and IC Intellectual Property cores for digital audio and video applications enabled by compression."
On July 24, 2003, Zoran reported record revenue for the second quarter of 2003. According to the NYTimes on the Web, revenues for the second quarter of 2003 were $44.7 million compared with $34.0 million in 2002 and $37.8 million in the PRECEDING quarter.
Net income for the quarter was $4.2 million or $.15/diluted share compared with $1.0 million or $.04/share for the same quarter in 2002, and $193,000 or $.01 per diluted share for the preceding quarter (1st quarter, 2003).
Looking at some fundamental data on Morningstar.com, we find revenue growth from $44.9 million in 1997, $44.2 million in 1998, $61.7 million in 1999, $79.7 million in 2000, $107.7 million in 2001, and $149 million in 2002. If we extrapolated the current quarter, we should get revenue over $165 million in 2003.
Free cash flow is positive with $1 million in free cash flow in 2000, $9 million in 2001, $17 million in 2002 and $6 million in the trailing twelve months.
Balance sheet is PRISTINE with $136.9 million of CASH balanced against $33.1 million of current liabilities and NO long-term liabilities. In addition, ZRAN has $61.5 million of other current assets reported.
Yahoo.com reports that ZRAN has 27.5 million shares outstanding with 27.0 million shares that float for a market cap of $645.3 million. No dividend is paid. The p/e is a bit steep at 70.78. There are 5.50 million shares out short representing 5.39 days of average trading.
Overall, I like this stock a LOT. In fact, I purchased shares yesterday!
I hope everyone has a GREAT weekend....drop me a line at firstname.lastname@example.org if you have any questions, comments, suggestions, or words of encouragement!
July 26, 2003 Trading transparency for 7/25/03
Yesterday, in the trading account, as you can see on the link to that page, we sold our 450 shares of E Loan Inc (EELN) and purchased 200 shares of Zoran Corp. (ZRAN). I will be discussing ZRAN in subsequent posts. Bob
July 26, 2003 "How are we doing?" looking back on week of June 16, 2003.
It is Saturday and it is a nice time to reflect on the first month's activity of our stock picks. Hopefully, as we maintain this site, we can give the stocks a little longer time period...and look at 6 month follow-ups!
June 16 found us recommending a stock that was soon to be acquired Whitman (WIX) that is thus no longer traded, oh well...and two interest sensitive stocks that as you know....now are under pressure as the interest rates appear to have bottomed at least temporarily.
American Home Mortgage (AHMH) was trading at $19.49 when it was posted on 6/16/03. It closed Friday at $19.10, a loss of $.39 or (2.0%) since the post.
We listed Dominion Homes (DHOM) on 6/16/03 trading at that time at $24.50. It closed Friday 6/25/03 at $24.29...down only $.21 since our post for a loss of (.9%).
Quest Diagnostic (DGX) was at $64.28 on 6/16 and is now trading at $48.78, a loss of $5.50 or (8.6%) since last month.
Factset Research (FDS) was selected on 6/17/03 at $40.39. Closing Friday at $44.00 this represents a gain of $3.61 or 8.9%.
Outback Steakhouse (OSI) was trading at $39.76 when it made our list. Friday OSI closed at $37.09, for a loss of $2.67 or (6.7%).
Tofu Time Inc. (TOF) traded at $2.82 when it was selected. TOF closed at $3.10 on 7/25/03 for a gain of $.28 or a gain of 9.9%.
LifeCell Corp (LIFC) was posted on 6/18/03 at $5.78. Currently trading at $4.99, this is a loss of $.79 or (13.7%).
Macrovision was selected on 6/18/03 at $21.15. Currently, MVSN closed at $22.69 on Friday for a gain of $1.54 or 7.3%.
Forest Labs was trading at $54.99 when we posted in on 6/20/03. Currently, FRX closed at $45.33, which was a loss of $9.46 (yikes Scott B. was right!)...representing a loss of (17.2%).
Laboratory Corp. (LH) was at $30.68 when we posted it on 6/20/03. Currently trading as of 7/25/03 at $31.20, this is a gain of $.54 or 1.8%.
Overall, a very dismal month for our picks of 6/16/03. We had 7 stocks with losses ranging from 17.2% to .9%, and 4 stocks with gains of 1.8% to 9.9%. Averaging this performance, we had an average loss of (2.73%) on the month from these stocks.
It will take longer to see how these stocks do over the intermediate future. But I have been stopped out on some of these stocks in my own trading portfolio and thus we limit our losses on issues to 8%.
Good luck investing and please stop by often and leave me a note at Bobsadviceforstocks@lycos.com or right here on the website if you have any questions, comments, or words of encouragement!
Thursday, 24 July 2003
July 24, 2003 Columbia Sportswear Company
O.K. this is the last one for the evening. Time for me to get off this computer and get some shut-eye. This is a company that most people have heard about...if only for all of their outdoors clothing and jackets. According to CNN.Money, Columbia "...is engaged in the design, manufacture, marketing and distribution of active outdoor apparel."
This stock is one of a couple of high-quality apparel stocks on this list. The other company is Coach which is in my trading portfolio and is listed elsewhere.
Columbia had a good day today, closing at $52.00 up $5.07 or 10.80% on the day. They ALSO reported their second quarter earnings results on 7/23/03. This Portland, Oregon, based company reported that global sales increased 22.5% to a record $152.1 million, adjusted for currency fluctuations, they still reported a 17.8 percent increase in sales. Net income increased 25.3 percent to $9.4 million or $.23/share vs $.19/share last year.
Most importantly, they RAISED their 2003 net income guidance to a 10-12% year-over year growth. Raising guidance is a very bullish indicator on a company.
Morningstar.com shows a pretty set of bar-graphs on the five year financials showing revenue growth from $427 million in 1998, $471 million in 1999, $615 million in 2000, $780 million in 2001, and $816 million in 2002.
Free cash flow has improved nicely from $31 million in 2000 to $29 million in 2001 and up to $131 million in 2002.
According to Morningstar website, this company is FLUSH WITH CASH...with $179.2 million in cash, way more than the current liabilities of $77.8 million and $27.3 million in long-term liabilities COMBINED. In addition....they have $261.6 million in OTHER current assets!
According to Yahoo.com 'profile', COLM has a market cap of $1.87 Billion with 39.9 million shares outstanding and ONLY 14.0 million shares that float!
The p/e is a very REASONABLE 17.14...especially with $4.50/share of cash....and as of 6/9/03, there were 1.61 million shares out short..about 3.47 days of average trading...so not that many shares to be covered in case of a short 'squeeze'.
I like this company a LOT and wear their jackets, etc. The numbers are nice, and even Peter Lynch style (God forbid!)....I know the product and like it. This would be a GREAT company to add to YOUR portfolio! I do not at this time own any shares nor do any members of my family....but I sure AM tempted!
Regards to all! Come and visit again soon!
(and tell your friends.)
July 24, 2003 Sierra Health Services, Inc. (SIE)
As a physician, I always am a bit annoyed by HMO's which are both our salvation and our burden. Kind of like the same way patients must view HMO's I guess! However, Sierra Health Services (SIE) went to the top of the list today in a group of managed care corporations that outperformed the market on a down day. We also have MME mentioned elsewhere on this site.
Sierra, according to CNN.Money "...is a healthcare services company that operates HMOs, indemnity and workers compensation insurers, military health programs, PPOs and multi-specialty medical groups."
SIE had a great day today closing at $27.09 up $5.79 or 27.18% on the day. They did this on the back of an outstanding earnings report. Quoting from the headline on the NYTimes on the Web from the Business Wire report: "2nd quarter 2003 earnings of $.68 per diluted share, income from continuing operations increases 95%; guidance raised for 2003." (Income was $.34 per diluted share in 2002.)
Morningstar shows a steady growth in revenue from $0.8 billion in 1998, $0.9 billion in 1999, 1.0 billin in 2000, $1.1 billion in 2001, and $1.3 billion in 2002.
Free cash flow has recently improved from a negative $17 million in 2000 to a positive $91 million in 2001, and $124 million in 2002.
The balance sheet is not as pretty as some of our selections but is fairly evenly balanced with $246.3 million in cash and $692 million in other current assets vs. $788.2 million in current liabilities and $166.1 million in long-term liabilities.
Yahoo.com 'profile' shows a market cap of $584.8 million with 27.5 million shares outstanding and 22.8 million float. The p/e is a very reasonable 13.15, no dividend is paid,a nd quite a few shares are out short at 2.25 million representing 7.3 days of trading of average volume.
In general, knowing the pressures and vagaries of health care as a busines, I am not a great fan of HMO stocks. However, trying to avoid personal biases I have to recommend this issue as being appropriate for selection in light of the continued outstanding business performance of this company.
Neither I nor any members of my family own any shares of this company.
Regards to All!
Posted by bobsadviceforstocks at 9:58 PM CDT
Updated: Thursday, 24 July 2003 10:00 PM CDT
July 24, 2003 Fair Isaac Corporation (FIC)
Stocks were looking so nice this morning and then about 2:15 just pooped out. So much for a nice morning rally!
If you read the previous post, you will see that I jumped out of NCEN...with a nice gain still remaining....and bought FIC...Fair Isaac Corporation. Fair Isaac, according to CNN.Money "...is a developer of data management systems and services for the financial services, retail, healthcare, telecommunications, personal lines insurance and other industries."
In spite of the pullback late in the session, FIC held on to a nice gain closing at $55.42 up $5.13 on the day or 10.20%. They performed well as the company reported a superlative earnings report for the second quarter yesterday: revenues were $163.0 million vs $91.0 million last year. Net income was $30.0 million or $.60/share compared to $14.4 million or $.41/share.
Morningstar.com shows a nice historical pattern of growth in this company: $246 million of revenue in 1998, $276.9 million in 1999, $298.6 million in 2000, $329.1 million in 2001, $392.4 million in 2002. Extrapolating the present quarter gets us over $640 million in revenue for 2003.
Free cash flow has grown very nicely from $14 million in 2000, to $47 million in 2001 and $80 million in 2002. Morningstar.com reports $109 million in free cash flow for the trailing twelve months.
Cash on hand is ample at $165.8 million with $152.7 million of other current assets. This is more than enough to cover the current liabilities of $90.9 million and $146.9 million in long-term liabilities as well.
Looking at Yahoo.com, we find that the market cap is $2.37 billion, 47.2 million shares outstanding and 46.4 million of those float. The company DOES pay a small dividend of $.08/share yielding 0.16%.
There are quite a few shares out short as of 7/8/03. At that time there were 4.59 million shares reported out short representing 11.64 days of average trading volume. This is bullish as it represents borrowed shares that have been sold requiring the short sellers to purchase these shares sometime in the future.
The p/e IS a bit steep at 53.84 and the company HAS had a great year already...but I like this stock a lot and as such have already purchased some shares (150) in my trading account.
Regards to all of my friends. Thank you for visiting and come back often! eMail me with any questions, comments, or words of encouragement at email@example.com.
Posted by bobsadviceforstocks at 9:40 PM CDT
Updated: Thursday, 24 July 2003 9:47 PM CDT
July 24, 2003 Trading transparency FIC for NCEN
Market doing pretty good today. My NCEN...listed elsewhere has the dwindles. Stock is creeping down...we still have a sizable gain. Company does mortgage business on less than top quality applications...with interest rates heading up at least on the interim...I decided to bail out with a nice gain. Replaced the shares with Fair Isaac...they had spectacular earnings report...so I picked up 150 Shares of FIC.
I will try to post the report on FIC later today...it is a nice company that is worth your attention and I DO own some shares now!
Regards to all of my friends! And readers!
Wednesday, 23 July 2003
July 23, 2003 QLT Inc. (QLTI)
Out late tonight and spent the day away from my computer....with the market up moderately today, I figured we'd find at least one stock that fits the bill and it looks like QLT Inc. (QLTI) works well!
I am familiar with this company which produces Visudyne, for photodynamic therapy which is used to treat the 'wet' form of age-related macular degeneration. I do not own any shares of this issue...nor does anyone in my family.
QLTI had a nice day today--closing at $15.39 up $1.59 or 11.52% on the day.
They reported their second quarter results today which was instrumental in driving the stock higher today. Sales were up 25% over 2002 for the quarter at $89.2 million. Earnings per share for the second quarter of 2003 was $.16 a 60% increase from the $.10 reported last year.
Morningstar shows no revenue reported in 1997 and 1998, then $17.9 million in 1999, $33.2 million in 2000, and $84 million in 2001. Extrapolating the current quarter we get about $360 million in sales in 2003.
Free cash flow which was -$38 million in 1999, and -$50 million in 2000 turned positive in 2001 at $19 million.
Assets and liabilities show QLTI flush with cash per Morningstar.com with $163.8 million in cash compared to $25.3 million in current liabilities and NO long-term liabilities. In addition QLTI has $86.2 million reported in other current assets.
Yahoo.com shows a market cap of $947.7 million with 68.7 million shares outstanding and 53.6 million shares that float. The p/e is a bit steep at 47.59 but not too unreasonable with the fast growth rate.
As of June 9, 2003, there were 2.39 million shares out short...representing 5.19 trading days. This is a positive effect on the stock price.
Overall, the numbers are nice and the balance sheet is clean but this still represents pretty much a one-product company with a product that merely ameliorates a dismal condition and usually does not provide a cure. I am not real enthusiastic about this issue, but if you keep to the 8% stops as we do on all of our issues, it may be worth some attention.
Thanks for stopping by the website! Be sure to drop me a line if you have any questions, comments, or as always appreciated words of encouragement.
Tuesday, 22 July 2003
July 22, 2003 Cognizant Technology Solutions (CTSH)
This one I have glanced at before but I don't have any shares. Let's take a closer look.
Cognizant, according to CNN.Money, "...is a provider of custom information technology (IT) design, development, integration and management services."
CTSH is having a GREAT day today on the back of a positive earnings announcement. Currently it is trading at $30.22 up $3.19 or 11.80% on the day.
Revenues for the quarter ending June 30, 2003, were $87.4 million up 17% from $74.5 million in 2002. Net income for the second quarter increased to $13.5 million or $.20/diluted share compared to $8.6 million or $.14/diluted share in 2002. (NYTimes on the Web)
Morningstar.com shows sequential annual growth in revenue from $24.7 million in 1997, $58.6 million in 1998, $88.9 million in 1999, $137.0 million in 2000, $177.8 million in 2001, and $229 million in 2002. Extrapolating the current quarter would give us over a $280 million annual revenue in 2003.
Free Cash Flow while inconsistent remains positive ranging from $20 million in 2000, $17 million in 2001, $21 million in 2002 and $16 million in the trailing twelve months.
The Balance sheet, as reported on Morningstar.com, is very nice: $126.6 million in cash...more than enought to cover current liabilities of $37.5 million and long-term liabilities of $24.5 million combined. In addition, Morningstar reports $55.9 million of other current assets.
This is a bit larger company than our last entry with $1.66 Billion market cap and 61.6 million shares outstanding with 61.4 million that float. The p/e while steep at 46.60 is better than the prior entry as well. More shares are out short: 5.45 million as of 6/9/03....representing 3.40 trading days to cover the repurchasing activity required.
I like this company a lot as well....only the p/e again is a bit steep. I do not own shares but would be happy to add to my holdings with some of these if the opportunity should avail itself.
Regards to all of my friends!
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