Stock Picks Bob's Advice
Thursday, 20 November 2003
November 20, 2003 Hot Topic, Inc. (HOTT)
Hello Friends! As always, remember to PLEASE discuss any ideas you retrieve off of this website with your investment advisor. I am an amateur investor and any ideas here may result in loss of your investment and may or may not be appropriate for you!
Today was a rough day in the market. First the sell-off, then the rally and then the late fade into the close. Kind of discouraging! Economic data wasn't bad but the continuing stream of violence in the mideast was unsettling for the stock market.
Looking, as we like to do, at the lists of greatest percentage gainers, is an interesting retailer called Hot Topic, Inc. (HOTT). HOTT had a nice day today on the back of earnings news released after the close of the market yesterday. HOTT closed today at $28.61 up $2.01 or 7.56% on the day. I do not own any shares, nor do any members of my family.
Yesterday, 11/19/03, HOTT announced their third quarter financial results. Revenue jumped to $161.5 million from $122.6 million last year. Net income was $15.3 million or $.31/share vs. last year's $10 million or $.21/share. Analysts, according to this report from Dow Jones, carried by Yahoo.com, were expecting only $.28/share which HOTT had forecast last month.
Looking at Morningstar.com, we find STEADY revenue growth from 4103.4 million in 1999, $168.9 million in 2000, $257.2 million in 2001, $336.1 million in 2002, $443.3 million in 2003 and $487 million in the trailing twelve months.
Earnings per share have grown steadily from $.14/share in 1999 to $.75 in the trailing twelve months.
Free cash flow has also improved nicely from $3 million in 2001, $13 million in 2002, $21 millin in 2003, and $24 million in the trailing twelve months.
The balance sheet is very nice with $70.3 million in cash, more than enough to cover both the short-term liabilities of $46.9 million and the long-term liabilities of $2.8 million combined. In addition, HOTT reports on Morningstar an additional $75.7 million in other current assets.
Checking some other "key statistics" on Yahoo.com, we find that the market cap is $1.36 Billion. The trailing p/e is at 33.34, with a forward p/e (fye February, 2005) is 24.18. With the quick growth reported and expected, we have a PEG on this stock at 1.15 which is quite reasonable, and price/sales is 2.60 which while a bit expensive isn't too bad either.
Yahoo reports 47.55 million shares outstanding with 47.20 million of them that float. Currently there are 6.10 million shares outstanding, quite a few (!), as of 10/8/03, representing 6.715 trading days. Either these people know something I don't or we are in the midst of one heck of a short squeeze! No dividend is paid; the company just had a 3:2 stock split on 9/3/03.
I do like this company and if I had a bit of free cash....well you know the story...I probably would buy a few shares. The PEG isn't bad and the p/e isn't that pricey. Furthermore, one of the best indicators of the health of a retail firm is the 'same store sales' numbers. For HOTT, this was reported by Dow Jones on Yahoo on 11/5/03, when they reported October same-store sales growth of 10.8%. This was a terrific report!
Well, thanks again for stopping by. Please be sure to discuss any ideas gleaned off this page with your financial advisor. If you have any questions about anything, please feel free to email me at firstname.lastname@example.org
Wednesday, 19 November 2003
November 19, 2003 Daktronics, Inc. (DAKT)
Hello Friends! Thanks again for stopping by. I have still been unable to update my website as I am having trouble with the Site-Builder software. Thank goodness the blog portion is still working for me so I can continue to post my ideas. As always, PLEASE discuss any and all ideas you derive from this site with your financial advisor. I am not a financial advisor but rather an amateur investor and I worry that some people may use my ideas and end up with losses instead of gains! Certainly feel free to discuss these ideas you glean with your advisor...but do so before acting on them!
The market has been acting a bit oversold short-term and took a break from its recent correction with a nice rally today. One stock that showed up on the lists is the stock of an interesting company called Daktronics (DAKT). I do not at this time own any shares of DAKT but did own some about a year ago. DAKT had a nice day today closing at $17.74/share up $2.11 or 13.50% on the day. According to money.cnn.com, DAKT "...is a supplier of electronic scoreboards, computer programmable display systems and large video displays for sport, business and government applications."
The stock moved up today on a nice earnings report issued yesterday, 11/18/03, after the close of the market. According to Yahoo.com, from BUSINESS WIRE, Daktronics reported their second quarter 2004 financial results for the period ended November 1, 2003. Net sales were $58.3 million, compared with $48.1 million last year, net income was $6.7 million or $.34/share compared to $4.0 million or $.21/share last year.
Looking at Morningstar.com, we find a fairly steady (except for a slight dip in 2002) increase in revenue from $95.9 million in 1999, $123.4 million in 2000, $152.3 million in 2001, a slight dip to $148.8 million in 2002, $177.8 million in 2003 and $182.6 million in the trailing twelve months.
Earnings/share have improved from $.24/share in 1999 to $.70/share in the trailing twelve months.
Free cash flow has also behaved well improving from $0 in 2001, to $9 million in 2002, $11 million in 2003, and $14 million in the trailing twelve months.
The balance sheet on Morningstar.com looks nice with $11.2 million in cash and $66.4 million in other current assets as opposed to $38.3 million in current liabilities and $4.7 million in long-term liabilities.
Looking at Yahoo.com for "key statistics" we find that DAKT has a market cap of $330.71 million. the trailing p/e isn't bad at 25.49 and the forward p/e (fye May, 2005) is at 17.76. Interestingly, the PEG ratio is at 0.84, one of the few stocks on this site with a PEG under 1.0...suggesting an excellent growth stock value...and the Price/Sales on trailing twelve months is at 1.60.
There are 18.64 million shares outstanding with 13.70 million of them that float. As of 10/8/03, there are 380,000 shares out short representing 7.17 days of trading. Perhaps these shares are the ones driving the stock upward on the good days? No dividend is paid and the last stock dividend was a 2:1 split in June, 2001.
This is an interesting stock. Certainly they are a niche player, but they have to be one of the biggest companies in their field of manufacturing all of those elaborate electronic signs at sports arenas. The stock sells at an excellent price relative to its earnings and growth with a PEG under 1.0. I don't own any shares but would not be adverse to picking some up here!
Please remember to discuss this and any other ideas on this site with YOUR investment advisor. As you know, not all investments here will be profitable and in fact may result in significant financial losses.
If you have any questions or comments, or even if you just have words of encouragement, I would love to hear from you at email@example.com Have a great week everyone and hope you all have a wonderful Thanksgiving!
Tuesday, 18 November 2003
November 18, 2003 Sybron Dental Specialties (SYD)
Hello Friends! I am still having one heck of a time trying to update the website portion of this BLOG. Will get to the bottom of this soon I am sure. Anyhow, remember to come back and visit often but ALSO please consult with your investment advisors before making any decisions based on my comments on this page!
As I said previously, I did a no-no and I have no one to blame but me. Basically, I am trying to get to my 25 position portfolio and when I sold my TTWO this morning, I started looking to see if anything would qualify to replace it, and before I could say "Jack Sprat", I purchased 200 shares of Sybron Dental (SYD) to replace the sold position. In reality, I am supposed to apply the proceeds to the margin balance...sort of a self-righting mechanism in a down market.
Sybron Dental (SYD), is a stock that I already own shares of in a managed retirement account. This is the first time I have put it in my trading portfolio. According to money.cnn.com, Sybron "...is a manufacturer of orthodontic equipment, dental supplies and related equipment."
Looking at the news on Yahoo, we can see that SYD reported GREAT earnings results for their fourth quarter ended September 30, 2003. These results came out "after the bell" yesterday (11/17/03). Net sales for the fourth quarter of 2003 totaled $137.7 million vs. $114.9 million last year. Net income was $17.3 million or $.43/diluted share vs. $6.9 million or $.18/share last year.
Looking at the "5-year restated" results on Morningstar.com, we find that revenue has grown steadily, if not spectacularly, from $366.9 million in 1998, $392.2 million in 1999, $423.1 million in 2000, $439.5 million in 2001, $456.7 million in 2002, and as just reported on Yahoo, $526.4 million in revenue in 2003.
Free cash flow has improved from $48 million in 200 to $59 million in the trailing twelve months.
The balance sheet is fairly well balanced although there ARE significant long-term liabilities: $19.9 millin in cash and $214.4 million in other current assets vs. $82.2 million in current liabilities and $340.7 million in long-term liabilities.
Looking at Yahoo for "key statistics", we find that SYD has a market cap of $984.65 million with a trailing p/e of 21.25 and a forward p/e (fye 9/04) or 15.56. The PEG ratio is reasonable at 1.14, and the Price/sales isn't bad either at 1.81. 38.24 million shares are outstanding with 38.00 million of them that float. Only 426,000 shares are out short but this does represent 3 days of average trading volume. This statistic is as of 10/8/03.
No dividend is paid.
Overall, I like this stock a lot. I like it so much that, No I didn't "marry it", as my kids might say, but I did go ahead and buy some shares today....200 to be exact. The valuation is right, the steady revenue growth is excellent, and the company, although with some significant long-term debt IS spinning off increasing amounts of free cash.
Thanks again for stopping by and sorry about the site-builder problems on the main page. Will keep working on that! Remember to discuss this and all investment ideas with your investment advisor as this may or may not be a good idea and in fact may or may not be suitable for you!
If you have any questions, please feel free to drop me a line at firstname.lastname@example.org
"Trading Transparency" TTWO sold, SYD bought
The market had a lousy day today and one of our most vulnerable stocks hit an 8%+ loss and was sold. Take-two Interactive, which was purchased on 9/3/03 at $35.47 hit an 8% plus loss and was sold today at $32.48. Going against my own rules that we should be applying the proceeds to margin, I went ahead and bought 200 shares of Sybron Dental (SYD) at $25.80. I already own some shares of SYD in a managed account; however, the stock made a nice move today, closing at $25.75, up $1.95 or 8.19% on the day, made our lists...I will post this in a minute...and had fairly good numbers. Believing the market is at least short-term oversold...I picked up 200 shares. Next time I better think about that Margin!
Sunday, 16 November 2003
"How are we doing?" A look back on the week of 9/22/03
Hello friends! Once again I will remind you to always remember to consult with your investment advisor as the stocks I discuss may or may not be a good idea for you!
I have been having a bit of a problem with the site builder program from Lycos, so we have not updated all of our picks and prices on the attached page. I will be working on that this week!
What I like to do on weekends is look back a bit and see if what we are picking has done well in the market. Only fair to check on what we write don't you think?
Two weekends ago we looked at the selections of 9/15/03. Last weekend we took a pass on posting so tonight I will look at the week of 9/22/03. You can view the actual selections by paging back on the calendar to the left of this blog and get to the mentioned days. That is how I knew which stocks to review right here!
On September 22, 2003 I posted two stocks: Bio-Reference Labs (BRLI) at $11.63 and TBC Corp. (TBCC) at $24.13. BRLI has actually done quite well (too bad I don't own any shares!) and closed Friday, 11/14/03 at $17.10. This is a gain of $5.47 or 47% in the past 7 weeks. TBCC has also done well since my posting (also I do not own any shares of this either shucks) and closed Friday, 11/14/03 at $29.00 for a gain of $4.87 or 20.2%.
September 23, 2003, was without any picks. On September 24, 2003, I selected America's Car-Mart (CRMT) at $29.61 and Multimedia Games (MGAM) at $34.30. CRMT closed Friday, 11/14/03, at $30.15 for a small gain of $.54 or 1.8%, and MGAM closed Friday, 11/14/03 at $42.80 for a gain of $8.50 or 24.8%.
On September 25, 2003, the WD-40 Company (WDFC) caught my eye at $31.20 and Cree, Inc. (CREE) at $22.16. WDFC closed Friday, 11/14/03, at $33.55 for a gain of $2.35 or 7.5%, and CREE closed on 11/14/03 at $17.99, for a LOSS of ($4.17) or (18.8%). I did not purchase and do not own any of these either.
Finally, on September 26, 2003, I picked Cherokee, Inc. (CHKE) at $20.90 and Abaxis, Inc. (ABAX) at $13.40. CHKE closed Friday, 11/14/03, at $21.75 for a small gain of $.85 or 4.1%, and ABAX closed Friday, 11/14/03, at $17.58 for a gain of $4.18 or 31.2%.
This was actually quite a good week with stocks gaining: 47%, 20.2%, 1.8%, 24.8%, 7.5%, 4.1%, and 31.2%, and one stock down with a loss of (18.8%). The average performance since posting about 7 weeks ago for these 8 stocks was a gain of 14.7%. Too bad I didn't buy any of them!
Thanks for stopping by! We will try to find some more picks next week for you to chew on. Also, if we get a chance, we have been up for a bit over 6 months now, so it will be fun to look at our picks from the "early days" and see how they have stood up. It has been easy picking these stocks these past six months since it has been a good market to do this. The true test will come as we enter a correction phase and get through that as well.
Anyway, thanks again for stopping by. Remember to consult with your investment advisor prior to taking ANY action on these stocks as they may or may not be suitable for you and may result in a significant loss of money!
If you have any questions, comments, or words of encouragement, please feel free to email me at email@example.com.
November 16, 2003 Problems Updating Site
Have tried a few times to update the main website regarding closing prices on recommended stocks and current trading portfolio and it seems that either MY computer or LYCOS computer is a bit on the fritz. I suppose it must be mine...will continue to work on the daily picks...but note that the rest of site is not updated yet. Sorry. Will keep working on this! Thanks for your understanding!
Posted by bobsadviceforstocks at 3:34 PM CST
Updated: Sunday, 16 November 2003 3:33 PM CST
Friday, 14 November 2003
November 14, 2003 Medical Technology Systems (MPP)
Thanks for stopping by! As ALWAYS, please consult with your investment advisor before making any decisions based on what you read here because as I always remind you, I am an amateur, and the investments I present may lead to gains or losses and may or may not be appropriate for you!
Anyway, I found a SMALL company which looks interesting on the AMEX of all places! Medical Technology Systems (MPP) made the greatest percentage gainers list on the AMEX today closing at $6.00 up $.46 on the day or 8.30%.
According to money.cnn.com, MPP "...manufactures and sells proprietary packaging systems to pharmacies that dispense prescription medications for use by nursing homes and assisted living facilities."
On November 4, 2003, MPP reported their second quarter results for the quarter ended September 30, 2003. As reported from BUSINESS WIRE on the NYTimes on the Web, revenue for the second quarter increased 18% from $6.8 million last year to $8 million this year. Net income rose 62% to $381,000 or $.06/diluted share vs. $235,000 or $.04/diluted share last year.
Looking at Morningstar.com for the "5 year restated" results, we find that revenue, while erratic the past 10 years, has steadily increased the past 5 years from $15.1 million in 1999, $18.2 million in 2000, $21.5 million in 2001, $24.8 million in 2002 and $29.4 million in 2003.
Earnings/share have also been erratic from ($2.20)/share in 1999, peaking at $2.36/share in 2001 and dropping to $.23/share in 2003.
Free cash flow has been steady at $2 million since 2001, and the balance sheet shows $0.4 million in cash and $9.0 million in other current assets vs $5.0 million in current liabilities and $7.0 million in long-term debt.
Looking at "key statistics" on Yahoo.com, we find that this company has a TINY market cap of $26.43 million. The trailing p/e isn't bad at 21.74 and the forward p/e is even more reasonable (for fye March, 2005), at 11.31. There are only 4.40 million shares outstanding and 2.80 million of them float. No dividend is paid.
This is an interesting stock and you should know that I do not have any shares. However, the pricing isn't bad and I suspect if the revenue continues to grow, the stock will also be flying. The downside for me for this stock is the small price and the ease in which it can hit an 8% loss and be out of the picture.
Good luck investing! If you have any quesitons, please feel free to write me at firstname.lastname@example.org
Thursday, 13 November 2003
November 13, 2002 Medtronic (MDT)
Thanks again for stopping by! Each time I write, I want to again ask you to please check with your own investment advisor before making any decisions based on information on this site. I am an amateur and NOT an investment advisor.
Today, an old growth stock favorite of mine hit the best percentage gainers on the NYSE: Medtronic (MDT). I do not own any shares at this time but would love to have some in my portfolio eventually. MDT closed today at $46.39, up $2.02 or 4.55% on the day. Their business overlaps with St. Jude Medical, that I recently purchased in my trading account and that we listed here elsewhere on this website.
According to money.cnn.com, Medtronic "...is a medical technology company engaged in manufacturing and selling device-based medical therapies. The Company's product lines include cardiac rhythm management, vascular, cardiac surgery, neurological & diabetes & spinal and ENT."
Yesterday (11/12/03) MDT was reported on the NYTimes on the Web, picked up by BUSINESS WIRE, to release their second quarter results ended October 24, 2003. Quarterly revenues were $2.164 billion, up 14% over the $1.891 billion last year. (currency effects had a positive effect on revenue of $59.1 million) Earnings were $476.1 million or $.39/share an increase of 58% over the $301.7 million in net earnings and 56% above the $.25/share reported last year in the comparable period.
Checking Morningstar.com, we find sequential revenue growth from $4.2 billion in 1999, $5.0 billion in 2000, $5.6 billion in 2001, $6.4 billion in 2002, $7.7 billion in 2003 and $8.0 billion in the trailing twelve months.
Earnings per share have also grown nicely, although not quite as linear between 2000 and 2002, however they were $.39/share in 1999, and by 2002 were up to $1.30/share.
Free cash flow has been significant and growing from $1.39 billion in 2001, $1.2 billion in 2002, $1.7 billion in 2003 and $2.0 billion in the trailing twelve months!
A brief look at the Balance Sheet as reported by Morningstar shows $1.28 billion in cash, $3.09 billion in other current assets vs $1.8 billion in current liabilities and $2.6 billion in long-term debt.
Looking at Yahoo for "key statistics", we find that this is a LARGE company with a market cap of $56.44 billion. The trailing p/e is 34.21, but forward p/e (fye April, 2005), is 23.48. PEG ratio moderate at 1.50, price/sales steep at 6.74.
There are 1.22 billion shares outstanding with 1.21 billion of them that float. Currently there are 9.02 million shares out short (as of 10/8/03) representing 1.803 trading days. The company DOES pay a small dividend of $0.29/share representing a yield of 0.65%. The last stock split was a 2:1 split in September, 1999.
This is a GREAT stock. But no bargain. I do not own any shares but like so many other stocks would LOVE to have it in my portfolio if that could be managed!
Thanks again for stopping by. Please email me at email@example.com if you have any comments, questions, or words of encouragement!
November 13, 2003 Whole Foods Market, Inc. (WFMI)
Hello Friends! As always PLEASE discuss ALL investment ideas you may glean from this website with your own financial advisor as I am just an amateur investor who loves to write and the ideas I post here may or may not be profitable for you and also may or may not be appropriate for you!
Anyhow, Whole Foods Markets, Inc. (WFMI) showed up on the lists of greatest percentage gainers today and it looks very interesting. I do not own any shares of Whole Foods but I confess to spending time on occasions wandering the aisles astounded at the fascinating merchandise and exotic range of food supplements and vitamins. WFMI had a great day today closing at $64.68 up $5.95 or 10.13% on the day.
According to money.cnn.com, Whole Foods "...engages in the sale of natural food and nutritional products, primarily through its 143 natural foods supermarkets (as of 4/03) and direct marketing of nutritional supplements."
As reported on NYTimes on the Web on 11/12/03, Whole Foods reported their fourth quarter results. As initially carried by PRNewswire-FirstCall, sales for the 12-week quarter increased 18% to $751 million from $638 million last year. This was driven BOTH by 10% increase in square footage AND 8.3% identical store sales growth year-over-year. These are very nice results!
Checking Morningstar.com, we find sequential revenue growth from $1.3 billion in 1998, $1.5 billion in 1999, $1.8 billion in 2000, $2.3 billion in 2001, $2.7 billion in 2002 and as just reported by the NYTimes, $3.1 billion in 2003.
Earnings/share have grown from $.82 in 1998 to $1.64 in the trailing twelve months. Free cash flow has picked up from $83 million in 2000 to $161 million in the trailing twelve months.
A look at the balance sheet as reported on Morningstar.com shows $131.0 million in cash and $199.8 million in other current assets, compared to $220.7 million in current liabilities and $177.5 million in long-term liabilities.
Checking Yahoo.com for some "key statistics" we find a market cap of $3.87 Billion, trailing p/e a bit rich at 39.49, PEG ratio at 1.82, and price/sales at 1.16. There are 59.90 million shares outstanding and 58.70 million of them that float. As of 10/8/03, there were 4.12 million shares out short representing 7.3 trading days of volume. I suspect some of today's steep climb was a scramble by shorts trying to cover...but that is just a guess on my part. Will need to see if next month's short interest has increased or declined. The October figure was up from 3.56 million shares out short the prior month!
The company DOES pay a small dividend of $.60/share yielding 1.02%. In addition, the stock last split in June, 2001, when it had a 2:1 split.
This is a wonderful company both on earnings and price momentum, in my humble opinion, and on a Peter Lynch basis...I love the stores! However, it is not a bargain, as the p/e is a bit steep even when examined on a PEG basis. However, it may be a great stock to have in your portfolio at some time. Remember, please discuss any of these investment ideas with your investment advisor to see if they think it is a good investment and to make sure it is suitable for you!
If you have any questions or comments, feel free to email me at firstname.lastname@example.org
Tuesday, 11 November 2003
November 11, 2003 Fossil, Inc. (FOSL)
Hello Friends. Market is getting ready to close and I have one more stock to share with you! As always, PLEASE discuss all of these ideas with your certified financial advisor as I am not one of those, I am an AMATEUR who loves the market...ok that's enough said. Came across Fossil, Inc. (FOSL) this afternoon. I do not own any shares not do any of my family although my kids have a couple of their watches!
According to money.cnn.com, FOSL "...designs, markets and distributes fashion watches and accessories, including sunglasses, small leather goods, belts and handbags." Currently as I write FOSL is trading at $28.42 up $1.79 or 6.72% on the day.
What drove the stock up today was an announcement of their third quarter sales and earnings today (11/11/03). As reported by NYTimes on the Web, from PRNewswire-FirstCall, FOSL reported for the thirteen week period ended October 4, 2003. Net sales increased 16.9% to $192.6 million compared to $164.8 million in 2002. Net income increased 19.2% to $16.8 million or $.34/diluted share vs $14.1 million or $.29/diluted share last year. These were great results and in fact, a record for the company.
Morningstar.com shows a steady record of revenue growth from $304.7 million in 1998, $418.8 million in 1999, $504.3 million in 2000, $545.5 million in 2001, $663.3 million in 2002 and $706.6 million in the trailing twelve months.
Earnings per share have improved from $.66/share in 1998 to $1.23 in the trailing twelve months. Free cash flow while taking a dip in 2001 to ($7) million has improved from $20 million in 2000, to $51 million in the trailing twelve months.
The balance sheet, as reported on Morningstar.com, shows $132.5 million in cash, more than enough to cover BOTH the current liabilities of $84.7 million AND the long-term liabilities of $41.7 million. In addition, Morningstar reports that FOSL has an additional $220.6 million in OTHER current assets.
Looking at "key statistics" on Yahoo.com, we find that FOSL has a Market Cap of $1.33 Billion, the trailing p/e isn't too high at 23.00, and the forward p/e (up to fye January, 2005), is at 16.34. The PEG ratio isn't bad at 1.19, and the price/sales also isn't too pricey at 1.76. All-in-all not too bad a value for a growth stock.
Yahoo reports that there are 46.60 million shares outstanding with 716,000 shares out short representing 2.819 trading days as of 10/8/03. The float is only 24.7 million shares. No cash dividend is paid. The last stock dividend was a 3:2 split last year in June, 2002.
If you can't tell from this write-up, I actually LIKE FOSL. I am not THAT excited about their watches personally but my kids think they are 'hot'. Generation thing I guess. What attracts me is the reasonable valuation on a very consistent growth company. PEG ratio near one, Price/sales near 1.75, P/E itself just over 20, and a superb balance sheet. Now if I ONLY had some CASH instead of a LOAD of Margin! Oh well. Thanks again for stopping by! If you have any questions, comments, or words of encouragement, please feel free to email me at email@example.com!
Posted by bobsadviceforstocks at 3:00 PM CST
Updated: Tuesday, 11 November 2003 3:02 PM CST
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