3SOF

QuoteWhat do you mean failed to break out? What resistance was this breakout supposed to overcome? You held the stock for one day. It looks like there is going to be a golden cross coming soon. Im sad to see TRMM go

The $3.32 level on close, as you can see on the chart below. Tokyopua explained it perfectly, technically it was a bullish triangle breakout play, but it failed.

Yes, I held it for just one day, it didn't felt right to hold that stock. When at a loss I usually get away quickly (at least on the 3 Stocks on Fire Portfolio) to limit losses. As for profits, I want to let them run.

Anyway, TRMM can respect the ascending trendline and breakout later. Good luck.

Quote from: tokyopua on February 23, 2007, 12:48:18 PM
I just picked up some NEOL at 2.05.  No need for analysis, just a heads up, its another failed biotech like COR, but running suddenly on no news...

NEOL just hit 2.24, something is up, maybe a short squeeze 

ZONS on fire 

David,I have some question.

Do you look on Insiders ot Tutes transaction when you are buying stock?

Thank you.

Quote from: cramercramer on February 23, 2007, 01:30:28 PM
David,I have some question.

Do you look on Insiders ot Tutes transaction when you are buying stock?

Thank you.

"Insiders ot Tutes"? Is that English? Sorry, never heard of it ... What is "Insiders ot Tutes"?

Thanks

Quote from: tokyopua on February 23, 2007, 01:27:02 PM

Quote from: tokyopua on February 23, 2007, 12:48:18 PM
I just picked up some NEOL at 2.05.  No need for analysis, just a heads up, its another failed biotech like COR, but running suddenly on no news...

NEOL just hit 2.24, something is up, maybe a short squeeze 

No more resistance for quite a ways here...

Since you sold TRMM would MSI qualify as a 3stocksonfire?

Quote from: Guloso on February 23, 2007, 11:43:33 AM

Hi David,

Hope you are fine. Long time without to talk with you (previously we talked in our native language).  I feel stupid in write to you in English!!!  First of all, congratulations to you and to PM for all the good work.  Keep on that!

What do you think about MFI?  The Average Daily Volume is lower than the 50.000 (around 35.000) but the chart and fundamentals are good. 



Hi David,

Could you check MFI today?  It seems it is preparing a new strong movement. Thanks.

Hi Guloso, do I know you? Where did we used to talk? www.bolsainvest.pt? Or www.clubeinvest.com? What was your nickname, maybe I remember you.

As for MFI, the stock has very low average volume, just 30,000 shares or so traded today. Would you like me to do a brief long term fundamental analysis on it?

Thanks

Sorry- Insiders or Institutionals /we call Tutes/

NTTL start moving

Quote from: nullzero on February 23, 2007, 01:39:54 PM
Since you sold TRMM would MSI qualify as a 3stocksonfire?

I'm thinking about it. You know I own MSI at $1.93 and already have a 70% profit on it, but the stock is just exploding today, with extremely high volume. It is a stock I know very well and I see it at $6 or more before 2007 closes.

But I feel I shouldn't mix the "Fire" portfolio and the "Main". That can lead to confusion. But it is definitely a stock on fire.

Quote from: cramercramer on February 23, 2007, 01:45:50 PM
Sorry- Insiders or Institutionals /we call Tutes/

NTTL start moving

Yes, I look at that, but I don't consider it as important as most people. To me it doesn't matter all that much who owns the shares, but their value.

The thing I pay a lot of attention are the share count variations. Because, after all, a company's value is the market cap, and market cap = # shares outstanding*share price.

Everybody pays a lot of attention to the share price, but almost nobody cares about changes in the number of shares outstanding, and they both influence the market cap, that is, the value of the company, that is, the fundamental value of each share.

As I see it, the market's primary reason to exist is for companies to finance themselves, create jobs and a growing economy, not to give small speculators like us money.

We may call ourselves investors ... but no, the company doesn't get any money when we buy shares (unless we're buying newly issued shares from the company). The only thing the company gets, if the share price rises, is an opportunity to finance itself better, or else, it is working for the shareholder's benefit, because insiders or the shareholders collectively and effectively own the company, with power to put management out.

If the company doesn't dilute shareholder's value over the years that means it doesn't need the market to finance operations. It is ready to reward shareholders. Even better if insiders own a big chunk of the company, their fortune will rise as the share price rises. Sometimes "insiders" think like employees, they're not interested in making the share price rise on a sustainable basis, they're only interested in keeping their jobs and if possible, increase their income.

A company can grow a lot in terms of sales and net income, employees get a nice pay for their job, and yet the share price declines because they keep diluting shareholder's value.

It makes you scratch your head about many news and optimistic prospects outthere. They mean nothing if there's dilution.

This post is too long ... let's keep on studying stocks, no, let's look for stocks really on fire ... or just random talk, it's Friday, I've lost patience to look at more financial reports.

Quote from: David Randolph on February 23, 2007, 01:11:29 PM

Quote from: nica33 on February 23, 2007, 09:47:40 AM
Good morning David.  I would like to know your opinion for JADE.  they finish 2006 with 45 stores and by December 2007 their plans are to open 100 more.  The last year earnings were 34 cents.  How much could be with those new stores?

Thanks

JADE, here's a magic stock! I should have taken your advice to buy it on that dip ... it was at about $6.5 back then

Well, a simple math calculus would say that if with 45 stores they earned 34 cents per share, with 100 they would earn (100/45)*$0.34 = $0.76

We wish stocks were that simple ... but I tell you, maybe that is what's really going on with JADE. If $0.76 were a fair 2007 EPS estimate, the stock would then be trading at 15 times forward earnings, which is about the market average.

But of course, there's more to it, let me make a new brief fundamental analysis on JADE, to see if I see something more to it.

• Market cap is $214 M. A vertically integrated company that designs, brands, markets and distributes a complete range of fine jewelry. Specializes in semiprecious jewelry.
• They like to dilute. The share count on September the 30th was 18.94 million, but just 15.5 million in 05, 12.3 million in 04 and so on.
• Balance sheet is ok.
• Revenues are growing nicely since 02. They're expected at $123 M in 06. Price to sales ratio is 1.74
• Due to dilution, despite having net income growth in 2005 compared to 2004, EPS was lower. The company gave 2006 EPS guidance of $0.34, with $0.16 coming from the 4th quarter alone. From 05, net income rose 76%, but EPS growth was somewhat lower, at 62%, due to 22% dilution

I have doubts that the current rally will continue to much higher levels. I'm afraid the company will use the rally to increase the share count a good 20 or 30% more, because that has been their practice.

If I held it I would take profits. I think the move has run its course. Can be wrong though. Good luck and congrats on this spectacular trade nica33

Hi David,
First, as a newbie to this board, let me say that this is the most usefull board I have seen, ever.  The high levels of knowledge and professionalism are remarkable. David, I attribute all of that to you- Thank You!

About Jade:
They have two different but related businesses. The wholesale business, primarily located in the US, while growing somewhat, is a 25% margin business.  The new Enzo line of retail stores in China, has a growth rate of 45 stores  in 18 months and a gross margin of 50% . These stores typically have 3 employees and are rapidly becoming profitable.

They predict another 65 store openings this year.

They predict that revenue from the retail operations (50% gross margin) will overtake the older more mature wholesale business (25% gross margin) this year. Enzo produced 40m in revs this year. Jade is predicting by 2008 [end of 2007 ] 40m a quarter from Enzo, [400% growth in that portion of their business]

Jade has publically announce that is acctively examining ways to enhance shareholder value including a potential strategic partnership or a potential partial spin-off for ENZO. We would spin-off 30% max of ENZO and maintain the 70% of ENZO at the wholesale level.

David, You may be right about JADE short term, the chart is looking extended, but  there may be good things long term.

Thanks again,

Edit:

David, you are right. Its Friday, time to relax a bit. Sorry for the long post!
Tony

Quote

Hi Guloso, do I know you? Where did we used to talk? www.bolsainvest.pt? Or www.clubeinvest.com? What was your nickname, maybe I remember you.

As for MFI, the stock has very low average volume, just 30,000 shares or so traded today. Would you like me to do a brief long term fundamental analysis on it?

Quote

I wrote in both, but I changed several times the username. Don t worry if you don t remembers me. Normally we never forget the Gurus, but the opposite isn t true.

Yes, please. Despite the Daily average is around the 35.000, it seems to me the Fundamentals are good: Results are improving strong in the last years; good balance,

David,  I'm a little confused because I''m not understanding the difference between the main and the fire portfolios.  Which is the essence of both? Since the fire portfolio is short term (that's what I think), it shouldn't be approached more technical than fundamental? for example you say you have MSI in the main, but you could make some money today on that one buying for the Fire portfolio and selling as soon is not on fire any more.  Just my humble opinion.  

Yeah, that's a good story ravenquork. Against it you have dilution and the company doesn't file forms 10 with the SEC, and that usually means a drag on valuation, or, by other words, it means a lower than average earnings multiple.

Allow me to be the devil's advocate on JADE. I want you to persuade me to buy the stock on a further dip, because I want to, I have about 15% cash available on the Main Portfolio.

Tell me, if you can:

- What percentage of the company is still owned by its founders?
- On Yahoo I get $0.4 as a 2007 EPS projection. I assume you expect more. What is your 2007 EPS projection, based on the margins and expansion plans you refer to?

Take your time and thanks for your kind words, just doing my job