3SOF

For a start I'm not going to tell you what this company does, or what are their financials. I want you to focus on the next two charts:





They are pretty similar, aren't they?

Now let's compare the long term charts of the two companies, VPHM and HOM:





Again, the charts match very well, so exclusively according to technical analysis, the two stocks are basically the same. Perhaps I don't have to tell you what happened to VPHM after the pattern we're identifying here, but I'll show it anyway, since it is one of the most beautiful bullish trends I've ever seen:



The stock shot up 8 fold in just 4 months 

I know, I know, you're thinking:

«But that doesn't mean anything, fundamentals are completely different, one is a biotech and pharma company and the other provides specialty residential services»

My answer for this argument is: the market is made by people. Stocks don't go up by themselves, they need sponsors to bolster their prices. The way people trade a stock tells you a lot about its future potential and that can be perceived by analysing a chart. These two charts tell me people anticipate the same future for these two stocks.

VPHM and HOM are definitely stocks that I want. If you feel more pleased check the fundamentals on HOM, I think they are very attractive. Here I see a very simple trading plan in the making with low risk and huge potential (hold the stock and possibly add on pullbacks for as long as it closes above the ascending trendline).

I'm buying HOM tomorrow for the 3 Stocks on Fire Portfolio.

(This recommendation was made by David Randolph from 3 Stocks on Fire, and he will update this analysis everyday after the close until he sells the stock. The 3 Stocks on Fire Portfolio is up 148% since inception on 28th of April 2005. 3 Stocks on Fire is a Community of stock traders and investors. Our 3154 members exchange trading ideas and strategies on our message boards everyday. We welcome you as a new member of the 3 Stocks on Fire Community, please take 10 seconds to register and receive our free newsletter)

Wow David, i have not seen you so excited about two stocks like this and SNUS in awhile.  Gets me fired up ya know.  I know this market will do what it will and I must do my own DD and such, but I have all my funds tied up.  I like these 2 and was just wondering why you feel these have such a small failure rate and such high expectations?

Nothing special puenthouse, I turned bearish on the general market but it has proved me wrong. I need to catch up fast and be full invested in a few days.

Today was the day that my filter showed up the biggest percentage of very bullish stocks since 3 Stocks on Fire started, 5.1% (it usually rejects more than 99% of total stocks).

It was hard to choose between so many good opportunities, and I've picked these 3. I hope they do well.

With so much bearish news, hurricanes, oil prices and gasoline prices to the roof, and the stock market comes up with a powerful white candle from support?

I guess we're going to see a short term powerful advance phase in the general market, possibly to new highs ... stocks that are breaking out know offer the best chances for appreciation.

I leave a chart of the SPX ETF, good luck puenthouse 

These are fundamental info I put together for HOM. It seems to me that anything under 3.5 is undervalue. It is another AOB type company in my view. This is also one of a good hurricane play since they do remodeling business on south eastern states.

*** Lastest Acquistion News ***
Home Solutions of America Enters Into Letter of Intent to Purchase California Marble Company
Acquisition Expected to Add $3 Million in Annual Revenue and $500,000 in EBITDA and Expand Remodeling Services Offerings. The acquisition will be financed with internally generated cash.
 
Home Solutions Of America Inc (AMEX: HOM) is rapidly growing its core business through both an internal and acquisition strategy. HOM has experienced a nice increase in sales and earnings quarter after quarter. Insiders own 60% of the 16.8 million shares outstanding. Institutions own 2% of the low 6.5 million float. (get them from yahoo board) . 

The Company has implemented an aggressive acquisition program, completing one acquisition in 2002; two acquisitions in 2003; with several letters of intent outstanding for additional acquisitions in 2004. Typically, acquisitions are completed at approximately 4.0x to 5.0x historical cash flow with financing provided by outside capital, seller notes and common stock of the Company. Under this strategy announced in late 2002, the Company has rapidly grown from a revenue base of only a few million to its current revenue run rate of approximately $30 million. 

+++ HOM INVESTMENT HIGHLIGHTS:   
* 15.1 Million Shares in Float (O/S 21 Million) (get from yahoo stat)   
* Revenues of over $31million/year   
* Over 100% Revenue Growth. $2.5M in 2002,  $14M in 2003 and $31M in 2004
* Expect record revenue of 55-60M for 2005 
* 2004 Net Income of 12.8c/share   
* Market Cap $70 million
* P/E = 19.9
* Lastest quarterly Revenue Increases 117.6% (16.1M)
* Net Income Jumps 83%, and Diluted EPS of 4 Cents Increases 100%
* Company Increases Full-Year 2005 Diluted EPS Guidance to $0.18 to $0.20 From $0.14 to $0.18 Per Diluted Share

   
* Trading below when it was not profitable in 2003 ($3/share, see chart).
* Business Outlook (from Q2 report)

The Company today issued the following outlook for the balance of the year. It now expects to generate record full-year revenue of $57.0 to $61.0 million, compared to previous guidance of $55.0 to $60.0 million. It expects record EBITDA of $9.0 to $9.9 million, compared to previous expectations of $8.5 to $9.5 million. Home Solutions increased its 2005 guidance for fully-diluted earnings per share of $0.18 to $0.20 compared to previous expectations of $0.14 to $0.18 per diluted share. This guidance assumes that Cornerstone will incur significant additional costs in connection with the roll-out of its products to national home retailers.


* Insider buying  http://finance.yahoo.com/q/it?s=HOM
P 2005-05-26 2005-05-31 17:05:27 HOME SOLUTIONS OF AMERICA INC HOM OBRIEN RICK JUSTIN CFO 5,000 $1.39 $6,950.00 11,200 -4.32%
P 2004-09-14 2004-09-14 19:34:46 HOME SOLUTIONS OF AMERICA INC HOM OBRIEN RICK JUSTIN CFO 6,200 $1.34 $8,308.00 6,200 15.67% 
P 2004-01-26 2004-01-28 10:16:48 HOME SOLUTIONS OF AMERICA INC HOM KIMBRELL WILLARD W director 1,000 $1.78 $1,780.00 2,000 -2.25%
P 2003-10-14 2003-10-16 17:11:30 HOME SOLUTIONS OF AMERICA INC HOM GARTH TYRRELL L 10% owner 3,500 $2.20 $7,700.00 1,323,940 -6.82%
P 2003-10-14 2003-10-16 17:11:30 HOME SOLUTIONS OF AMERICA INC HOM GARTH TYRRELL L 10% owner 2,000 $2.22 $4,440.00 1,325,940 -7.66%
P 2003-10-14 2003-10-16 17:11:30 HOME SOLUTIONS OF AMERICA INC HOM GARTH TYRRELL L 10% owner 4,500 $2.25 $10,125.00 1,330,440 -8.89%
P 2003-07-11 2003-07-15 12:20:25 HOME SOLUTIONS OF AMERICA INC HOM KIMBRELL WILLARD W director 1,000 $3.04 $3,040.00 1,000 -19.41%
 
Home Solutions of America, Inc. provides restoration and specialty interior services for primarily residential properties to customers located in California, Texas, and Florida. The company operates in two segments, Restoration Services and Specialty Interior Services. The Restoration Services include indoor air contaminate removal, carpet cleaning, air-duct cleaning, and fabric protection for residential and light commercial properties. The Specialty Interior Services include cabinet and countertop installation services. Home Solutions of America was incorporated in 1998. The company was formerly known as Nextgen Communications Corporation and changed its name to Home Solutions of America, Inc. in 2002. Home Solutions of America is based in Dallas, Texas.   

I was trading this stock from low 2 to 3, gott in/out couple times around the core position. If the pattern repeats, it will consolidate in 2.6-2.7 region, but with the record volumn today 08/31/05...I am not quite sure where it will go next but I am sure that anything is a steal under $3...IMO.

Just look at their revenue and profit growth.
http://finance.yahoo.com/q/is?s=HOM&annual

GLTA.

As I came into VPHM very late (when I first posted here, about), I'm thrilled that you've already come across a "clone!" -- and VPHM still not seeing a top!

Wonderful find, great to be 'in on the ground floor,' this time...if our expectations are filled I can make the donation

I agree %100 on this stock, especially on the account of the Volume and overall bullishness.
Im gonna go in tomorrow morning after the first green candle.

Also as sad it is to say (in lieu of the hurricane) (re)construction is going up.

I'm glad I bought this stock when I first noticed it at 1.90.  I'm thilled that it is now discovered, since I have been waiting for the high volume to appear, as it did today.  So what's the expected target on HOM?  Back to the highs from 5 years ago?

I'm almost fully invested so i have only 1 place left, now i'm doubting between HOM, SYNC and SNUS to fill my last spot. 
I tend to go along with HOM with SNUS as a good 2nd!
It's not easy to choose when there are some attractive picks!Any suggestions?

I'm on the same boat.

Today's picks are absolutely yummy!

With an office in Birmingham, AL the potential in getting contracts from insurances Co and others for water restoration and mold remediation is huge.

interesting article on Mold in the aftermath of Hurricane Katrina

http://pdfserver.emediawire.com/pdfdownload/278628/pr.pdf#search='mold%20hurricane%20katrina';

Insider buying?

http://yahoo.brand.edgar-online.com/fetchFilingFrameset.aspx?FilingID=38 92844&Type=HTML
http://yahoo.brand.edgar-online.com/fetchFilingFrameset.aspx?FilingID=38 92845&Type=HTML

David, thanks. In at $3.20. The fundamentals looks solid. They are profitable and paring down their debt.

The chart comparison with VPHM was excellent. I would only differ in that the recurring demand for VPHM products is far stronger than that of HOM. Medicines are a necessity! Hence cash flow will be stronger for VPHM. Let me put it this way, for VPHM on a scale of 1-10, 10 being the strongest, I would give VPHM a 10 and HOM a 8!

We're having some insider buying on HOM too, just like it happened with VPHM. Put another 5% white candle on the chart below and it is looking more and more VPHM's kind.

I really don't know when I will sell this, my plan is to hold the stock for as long as it closes above the ascending trendline on the chart below.

Starfire, David doesn't differ. He addressed your specific point here:

Quote«But that doesn't mean anything, fundamentals are completely different, one is a biotech and pharma company and the other provides specialty residential services»

My answer for this argument is: the market is made by people. Stocks don't go up by themselves, they need sponsors to bolster their prices. The way people trade a stock tells you a lot about its future potential and that can be perceived by analysing a chart. These two charts tell me people anticipate the same future for these two stocks.

And the charts seem to reflect his point!