Stock Picks Bob's Advice
Thursday, 4 March 2004
"Trading Transparency" GI
Hello again! There I go breaking one of my rules. Sorry. But when I saw Giant Industries (GI) on the run again today, I decided to jump in. I WILL wait for a sail on a gain for my next purchase. And I WILL stay at 25 positions MAX....maybe I should write that on the board 100 TIMES!...anyway, picked up 300 of GI at $21.69 earlier this morning...a few minutes ago. At this very moment, GI is trading at $22.36, up $2.76 or 14.08% on the day....so it looks ok for the moment. Unfortunately, a lot (see the previous posts) of these stocks that spike retrace the move on the downside....and with an 8% loss limit...well you KNOW what happens!
Thanks again for stopping by! If you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com
Bob
"Trading Transparency" ESMC
Hello Friends. 'Speaking of the Devil', I mean, I just got done posting that last one on BRLI and KNEW that ESMC was hovering above that 8% loss...well there it went. Just a minute ago I checked my list....and there it was, ESMC at a 9% loss. YIKES. Anyhow, I put in the order and sold my 300 shares at $16.071. I hate these next day sales. That is why I like to avoid those low cost stocks. hmmm. Anyway, I had purchased the 300 shares on 3/3/04 at $17.89. Easy come, easy go I guess.
Thanks for sharing in my annoyance.
Regards!
Bob
"Trading Transparency" BRLI
Hello Friends. Well sometimes you DO have to buy them right. My recent purchase in the trading account, Bio Reference Labs (BRLI), hit our 8% loss limit today and was sold from the portfolio. I do this manually and check the prices at least daily. I sold 300 shares at $19.05. I had just purchased BRLI on 3/1/04 at a price of $21.24. But you know how those rules go. Escalon, my purchase from yesterday, is also hovering above the 8% limit...so that may go as well :(. We will be watching. Again, I shall not be replacing this stock with a new purchase until I have sold some other partial position at a gain.
Remember to always do your own due diligence, and check with your investment advisors to make sure all investment decisions are timely and appropriate for you! If you have any questions or comments, please feel free to email me at bobsadviceforstocks@lycos.com
Bob
Wednesday, 3 March 2004
"Trading Transparency" ESMC
Hello Friends! That nickel was burning a hole in my pcket again. So after selling some of my IGT for a gain, I felt that I could buy a little something...you know how that is. Anyway, I recently
posted ESMC on the BLOG and with that nickel in my pocket, and ESMC having a second day moving up nicely on great volume....well, I just broke down and bought 300 shares a few moments ago for my trading account. I paid $17.868/share. Hopefull, this doesn't IMMEDIATELY retrace its gain...and we have to sell...but WILL sell at any 8% loss.
Thanks so much for stopping by! Please be sure to do your own due diligence on this and all stocks mentioned on this website/blog and the Internet in general. I am not so trusting of everything I read either. If you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com
Bob
Tuesday, 2 March 2004
March 2, 2004 Cantel Medical (CMN)
Hello Friends! It is LATE Tuesday night, maybe it will be Wednesday when this gets posted, but I haven't posted a pick for today and I think I have a nice one for you. As always, please remember to do your own due diligence and research, and consult with your investment advisors to make sure any selection on this site is suitable for a purchase or sale for you!
Cantel Medical Corp. (CMN), according to the
money.cnn.com "snapshot" "...is a healthcare company concentrating in infection prevention and control products and diagnostic equipment, as well as servicing medical equipment. CMN also markets medical equipment." CMN had a nice day today, closing at $18.40, up $1.35 or 7.92% in an otherwise dismal market.
Early this morning, Cantel reported
second quarter 2004 earnings results and like so many of the stocks that end up on this site, the results were enough to propel the stock higher. During the quarter ended January 31, 2004, sales jumped to $41.1 million from $34.4 million the prior year. Net income was $2.6 million or $.26/diluted share, vs $2.4 million or $.24/diluted share the prior year.
Looking at
"5-Yr Restated" financials from Morningstar.com, we can see first that revenue has grown steadily and rapidly from $38 million in 1999 to $138 million in the trailing twelve months. Earnings/share have also steadily grown from $.20/share to $.85/share in the trailing twelve months. Free cash flow has improved from $1 million in 2001 to $10 million in the trailing twelve months.
Balance Sheet-wise, Morningstar reports that CMN has $10.5 million in cash and $53.1 million in other current assets, enough to cover both the current liabilities of $21.6 million and the long-term liabilities of $33.7 million combined.
Looking at
"Key Statistics" on Yahoo.com, we can see that CMN is a small cap company with a market cap of $171.58 million. The trailing p/e is 21.50 and the forward p/e for fye 31-Jul-05 is 16.28. The PEG is very nice at 1.05, with an also reasonable price/sales of 1.15.
There are only 9.32 million shares outstanding, and of those, only 7.50 million of them float. There are only 77,000 shares out short as of 2/9/04, but with the low trading volume, this still represents 3.5 days of average trading volume, but only 1.03% of the float.
No cash dividend is paid, and no stock split is reported.
If we look at a
point and figure chart on CMN, we can see that the stock just recently appears to have broken though a resistance level at around $14.0, and has headed higher in a strong fashion (in my humble opinion.)
Overall, I like this stock quite a bit. Except for the low trading volume and the low market cap, the value is excellent with a p/e just over 20 and a PEG just over 1.0. The balance sheet is solid and the company is generating nice free cash flow! We will have to see how stocks trade as this might become another addition to my portfolio!
Thanks again for stopping by. If you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com
Bob
"Trading Transparency" IGT
Hello Friends! Looking hard for a profit, I found that IGT was getting in the range of a sale of a portion of my 200 shares and I went ahead and sold 50 of IGT a few minutes ago at $42.71/share for about a 23% gain. I purchased my 200 shares of IGT (International Game Technology), at $34.60 on 11/5/03. Now have 150 remaining...and can buy a new position (!)....at least when the market looks a bit healthier! Regards to all.
If you have any questions, comments, or words of encouragement, please email me at bobsadviceforstocks@lycos.com
Bob
Monday, 1 March 2004
"Trading Transparency" CYTC
Hello Friends! I got my sale on a gain. With about a 26% gain on my CYTC, I sold 100 shares earlier today at $18.71. My 500 shares were originally purchased just weeks ago at $14.86/share on 1/29/04. This allows me to spend one of my nickels that is burning a hole in my pocket so I shall be on the lookout for a good prospect to add to the portfolio! Interestingly, AAII Pharma, which was sold earlier this year is now down under $10. Yikes. Sure does pay when you note some fundamental problems in a stock! Or at a loss!
Regards again!
Bob
"Trading Transparency" BRLI
Hello Friends! With that nickel burning that hole in my pocket...well...what is a fellow gonna do? Reminds me of that old Cracker Jacks commercial...remember? Anyway, that sure dates me.
Bio-Reference Lab, Inc., is an oldie but goodie around here. I first posted BRLI on 9/22/03 when it was selling for $11.63 (!). Anyhow, NOW I have gotten around to buying some shares...they made the list of greatest gainers today, and I picked up 300 shares at $21.21. This is the
link to the original post on Bob's Advice!
Thanks so much for stopping by. Remember to do your own investigation of all stocks mentioned on this site prior to making any investment decisions...and always remember to consult with your investment advisors to make sure any investment is appropriate and timely for you!
Regards again, and remember to email me at bobsadviceforstocks@lycos.com if you have any questions, comments, or words of encouragement!
Bob
Sunday, 29 February 2004
"Seven Months Ago" A longer term view examining the week of August 4, 2003
Hello Friends! It is getting late Sunday evening and I guess I should be watching the Academy Awards with the rest of my family...but I am determined to get my 'housekeeping' chores for this website done before I call it a night. One of the things I have been doing each weekend is trying to see how the stocks I have picked have been doing. Sort of an appraisal of this entire process I guess. I mean I owe it to all of you who take the time to stop by to at least review what I have picked and tell you what has happened since! Eventually, I will try to start looking out one year instead of just seven months....this blog has been up almost a year now...and I once heard if you do something regularly for about six weeks you can make a habit of it. Past that point now!
As always, please always do your own due diligence and research all of the stocks posted here. Remember to cut your losses quickly and let your winnings run. In general!
I had a very busy week during that first week in August, 2003. I actually posted 11 stocks that week, so bear with me, and let's take a look at how they are doing now.
Atrion Corporation (ATRI)
was posted on Bob's Advice on 8/4/03 at a price of $34.70. ATRI closed 2/27/04 at $44.51 for a gain of $9.81 or 28.3%. They ARE planning to split 3:2 later this month.
On February 12, 2004, ATRI reported their
fourth quarter 2003 results. For the quarter, ATRI reported revenue of $14.8 million in 2002, vs $15.3 million in the same quarter in 2002. Earnings, however, were $.68 in 2003, vs $.57 in 2002. With the slight contraction in revenue, I would probably be cautious about committing new money to this stock..in my opinion.
Intier Automotive (IAIA) was
posted on 8/4/03 at a price of $16.50. IAIA closed on 2/27/04 at $15.86, for a loss of $(.64) or (3.9)%.
IAIA
announced fourth quarter 2003 results on 2/23/04. Sales were $1.4 billion for the quarter, up 35% compared to $1.06 billion in the same quarter in 2002. Diluted earnings per share were $.37 compared to a loss of $(0.09) in 2002. This company appears at least at first glance to be doing just fine.
Mylan Laboratories (MYL), a stock that I currently still own in my trading portfolio, was
posted here on 8/4/03 at a price of $34.50. On 10/9/03, MYL split 3:2 so our effective price on the website was $23.12. MYL closed 2/27/04 at $23.50 for a gain of $.38 or 1.6%.
On January 29, 2004, MYL
third quarter fiscal 2004 earnings. For the quarter ended 12/31/03, net revenues increased 9% to a third quarter record $349.8 million. Diluted earnings per share for the quarter were $.31/share vs $.24/share the prior year, an increase of 29%. It appears that this company is also doing just fine.
August 6, 2003, found me
posting FTI Consulting here at a price of $21.90. FCN closed 2/27/04 at $16.42, for a loss of $(5.48) or (25)%.
On 2/18/04, FCN announced their
fourth quarter 2003 results. For the quarter, revenues were $96.2 million, an increase of 6.2% compared with $90.6 million for the fourth quarter of 2002. However, earnings per share declined 26.8% to $.30/share, from $.41 the prior year. These results are not strong enough to continue to recommend this stock on this website. We will continue to follow this one, like I do with all of the others!
Hang in there....four down and seven to go!
Zimmer Holdings (ZMH) was
posted here on 8/6/03 at a price of $49.79. This orthopedic-related firm, which was spun off from Bristol Myers, has done well since out pick, and closed on 2/27/04 at $75.64, for a gain of $25.85 or 51.9%.
On February 9, 2004, ZMH
announced fourth quarter 2003 results. Due to acquisitions, ZMH had revenue growth of 90%, diluted earnings per share were up 38% over the prior year, and they increased 2004 eps guidance. They appear to be doing great, and the stock is following this underlying performance!
August 6, 2003 found me
posting Pulte Homes (PHM) on the blog at a price of $63.86. PHM split 2:1 on 1/5/04, so out effective recommended price was only $31.93. PHM closed on 2/27/04 at $52.76 for a very nice gain of $20.83 or 65.2%.
On 1/28/04, PHM
reported fourth quarter 2003 results. Revenues increased 24% to $2.9 billion, and diluted earnings per share increased 40% to $1.95 from the prior-year $1.39. The company also raised 2004 guidance. This was a GREAT report...and explains the amazing stock performance!
Next, on 8/6/03, I
posted DRS Technologies on the blog at a price of $27.98. DRS closed at $30.16 on 2/27/04 for a gain of $2.18 or 7.8%.
On 2/12/04, DRS
third quarter earnings. Revenue for the quarter jumped 68% to $280.6 million, attributed to the purchase of Integrated Defense Technologies Inc. Earnings for the quarter came in at $11.6 million or $.45/share compared with $7.4 million or $.41/share the prior year. This company and the stock still look attractive to me!
Hang in there, 7 down and four more to go!
Sunrise Senior Living (SRZ) was
posted here on 8/6/03 at a price of $23.95/share. SRZ closed 2/27/04 at $35.16 for a gain of $11.21 or 46.8%.
On 2/26/04, SRZ reported
fourth quarter 2003 results. Earnings per share actually DROPPED $.15 to $.67 from $.82 in the prior year. Revenues "under management" increased 160% to $1.7 billion. I don't really understand these numbers and would have to put a caution sign in front of this stock. I don't own any shares of this one, and would be a little careful in adding any positions even though it HAS been a great performer for us!
On August 7, 2003, I
selected Jos A. Bank Clothiers for the Blog at a price of $44.16. JOSB had a 3:2 split on 2/19/04, so our effective selection price was actually $29.59. JOSB closed 2/27/04 at $33.00 for a gain of $3.41 or 11.5%.
On 12/1/03, JOSB
reported third quarter 2003 results. Total net sales for the quarter ended 11/1/03 were up 24.4% to $72.0 million compared to $57.9 million in the same period of 2002. Comparable store sales were up 8.7%, while catalog and internet sales were up 25.6% during the quarter. Earnings per share increased 46% to $.38/share compared to $.26/share in 2002. These were GREAT results, and the stock still looks nice to me. As I have noted elsewhere, I do not own any shares of this stock.
O.K. just two more!!!
On 8/8/03, I
posted eSpeed (ESPD) on the blog at a price of $18.98. ESPD closed 2/27/04 at $20.19 for a gain of $1.21 or 6.4%.
On February 9, 2004, ESPD
reported fourth quarter 2003 results. Quarterly revenue was up at $27.7 million vs. $22.4 million the prior year. Net operating income, however, was down at $8.8 million vs $9.2 million the prior year. Diluted GAAP earnings/share were flat at $.15 both in 2003 and 2002 for the same quarter. Overall, this is a plus/minus report imho, and would put a 'caution light' on this stock avoiding any new committments, although not seeing news bad enough to outright sell this stock.
Finally, at long last, I
picked Emulex (ELX) on the blog at $22.46 on 8/8/03. ELX closed at $23.18 on 2/27/04, a gain of $.72 or 3.2%.
On 1/27/04, ELX
reported 2nd quarter results. Revenues were up 23% from the prior year. However, diluted eps actually came in at $.04/share, vs $.19/share the prior year. Like some of the others with similar results, sticking to our guidelines, I would have to put a caution on this particular issue.
Overall, for the 11 stocks, I had an average gain of 17.6% during this seven month period! Not too shabby indeed. Thanks so much for hanging in there for this rather tedious, but necessary review!
Remember, past performance is NO GUARANTEE of future performance for these or any stocks. I hope that you enjoyed this review and if you have any questions, comments, or words of encouragement, please feel free to email me at bobsadviceforstocks@lycos.com
Bob
Posted by bobsadviceforstocks at 9:08 PM CST
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Updated: Sunday, 29 February 2004 9:36 PM CST
"A reader inquires about PEG ratios, and Short-Interest"
Hello Friends! I really enjoy getting an email with a good question. First of all, I am an amateur investor myself, but I will try to answer any question the best I can.
Brian L. writes: "Here's my first question. On Feb 27th you give an overview of shuffle master (SHFL). You talked about outstanding shares and floating shares with a relationship to shares out short, What is this telling us about the stock and if this a short term indication how short? Also you talk about PEG being high or you will say, "It's only" what number is the middle of the road or neutral? Take care"
Indeed, on 2/27/04, (just two days ago), I
posted SHFL on this website. Most of my statistics come from the
"Key Statistics" on Yahoo.com.
First question, what about the "short interest." For me, this is a number which gives me two bits of information, 1) if this is high...more than a day or two of trading volume...then this may be an opportunity to benefit from a short 'squeeze'. That is, if the price rises on good news, the stock may head higher quickly as short-sellers look to cover their positions. In the case of SHFL, we can see that the short ratio is 26.925, with 5.71 million shares out short or 37.80% of the float. This actually, per Yahoo, expanded from December 2003, by about 500,000 shares. 2) However, a word of caution, short sellers are not completely ignorant either, and maybe there is information out there on a stock that is potentially damaging....so a short interest this high also must make one a bit cautious...sort of going against the trend.
I went on the web to see if I could get anything else. Best I could find was
a definition on investorwords.com, which stated that: "Short interest divided by average daily volume over some period, usually 30 days. Some investors believe that a high ratio is a bullish indicator, and a low ratio is a bearish indicator." As we look at stocks, it is just one more factor that we should consider...and maybe we can all get a better feel for what will happen with the stock price in the near future!
Next you asked about the PEG ratio. I usually pick this up also from Yahoo.com. The PEG is a measure of valuation that is more informative than the standard P/E ratio. The P/E is a static number indicating the current price over the trailing earnings. If a company is expected to grow quickly in the future, it may indeed be reasonable to pay a higher P/E if the growth is coming soon. This is how the P/E ratio is developed. This is somewhere along the lines of GARP...not the "World According to..." but "Growth At a Reasonable Price."
What PEG is reasonable? Tough call. Certainly PEG ratios near one or under are quite reasonably priced. This suggests that the p/e and the growth rate are fairly in synch. If you are paying over a 2.0 PEG then you are certainly paying a premium for the growth, in my opinion. That doesn't mean that a low PEG will guarantee that a stock will rise or that a high PEG means the opposite...but just another factor to get a feel for the valuation of an investment. I try to keep my analysis a little 'eclectic' if that is the right word (!), meaning I don't want to be truly JUST a growth investor, or a value investor, but more along the lines of growth at a reasonable price I guess!
Again, looking on the Web, I found a
nice explanation from the Motley Fool website.
I hope that this discussion is helpful for you! I really DO enjoy getting emails and questions from people who read what I write. It is my sincere wish to be informative. But remember, I am NOT an investment advisor and I am learning along with you about all of these investment ideas!
Regards again,
Bob
Posted by bobsadviceforstocks at 7:56 PM CST
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Updated: Sunday, 29 February 2004 7:59 PM CST
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