Sunday, February 17, 2008

A Dozen Doubles

Well, some say we are in a bear market, who knows for sure? In my opinion the markets are in the process of making a significant low, it is a process not a point. A general glance at individual stock charts is sobering, most have been in stiff downtrends for over a year, that’s when the "bear market" happened though people seem to be noticing it just now, how odd.

It seems to me that prices have declined enough to create opportunities. I made a few mods to my charting program so it would draw a horizontal line at a double from today’s closing price and took a look at a lot of charts. Generally I was looking for situations where the stock price could double by just returning to a previous support/resistance level and not necessarily a new high, something achievable without a rampantly bullish market. The following dozen stocks are ones I have been watching. There are obviously a lot of others I missed because I am not aware of them, I'm always open to new ideas.

NASDAQ:HOTT – Hot Topic Inc
Market Cap: $252.36M
Shares Out: 43.59M
HOTT - Yahoo Profile
"Teen specialty retailer Hot Topic Inc. on Wednesday backed its fourth-quarter profit guidance after posting a January same-store decrease that wasn't as bad as Wall Street expected.[AP]

NYSE:CHS – Chico’s FAS Inc
Market Cap: $1.77B
Shares Out: 176.15M
CHS - Yahoo Profile

NASDAQ:DROOY – DRDGold Limited ADS (South Africa)
Market Cap: $407M
Shares Out: 37.61M
DROOY - Yahoo Profile
One of the oldest miners around DRD has had its share of bad luck, poor management and lousy stock performance. While the SA mines are old and expensive to operate, with the current gold price hovering in the $900 area, DRD stands to finally turn a profit ($0.50??)in 2008. The stock reverse split 1/10 in 2007 and the smaller float makes the shares zippy for trading.

Market Cap: $906.62M
Shares Out: 236.72M
GSS - Yahoo Profile
Golden Star digs up the glittery stuff.

NASDAQ:SIMG – Silicon Image Inc.
Market Cap: $375.61M
Shares Out: 84.22M
Total Cash Per Share (mrq): $2.965
SIMG - Yahoo Profile
Silicon Image, Inc. is a global leader in driving the architecture and semiconductor implementation for the secure storage, distribution and presentation of high-definition content in the consumer electronics, personal computing, and mobile device markets.

NYSE:RT – Ruby Tuesday, Inc.
Market Cap: $399.22M
Shares Out: 51.71M
Worrisome: Total Debt: $591.74M
RT - Yahoo Profile
Ruby Tuesday, Inc., operates casual dining restaurants under the Ruby Tuesday brand name in the United States and internationally. As of June 5, 2007, the company owned and operated 680 restaurants; franchise partnerships operated 154 restaurants; and traditional franchisees operated 45 domestic and 54 international restaurants. The high level of debt may be a problem if sales fall enough to impair the debt service. On the other hand, insiders have been buying.

Market Cap: $957.10M
Shares Out: 56.23M
SOLF - Yahoo Profile
SOLF has a large short interest, I think this is primarily held as a hedge against the recently issued convertible [at $19.13] bonds. The company is experiencing very rapid revenue growth and is a potential big winner. Volatile ;-)

NASDAQ:DSTI – Daystar Technologies
Market Cap: $119.11M
Shares Out: 32.46M
DSTI - Yahoo Profile
The company develops a thin-film solar cell based upon the copper-indium-gallium-selenide semiconductor material system, known as CIGS. Its products include TerraFoil, a metal foil solar cell…

NASDAQ:EGLS – Electroglas Inc.
Market Cap: $46.64M
Shares Out: 26.35M
EGLS - Yahoo Profile
Electroglas, Inc. supplies semiconductor manufacturing equipment and software to the semiconductor industry worldwide. The company offers automated wafer probing equipment and related network software to manage information.

NASDAQ:EGLT – Eagle Test Systems Inc.
Market Cap: $275.46M
Shares Out: 22.97M
EGLT - Yahoo Profile
Eagle Test Systems, Inc. designs, manufactures, sells, and services automated test equipment for the semiconductor industry.
"Microchip testing company Eagle Test Systems Inc. said late Tuesday it expects fiscal second-quarter profit between 17 cents per share and 24 cents per share on revenue between $30 million and $34 million"[AP] EPS should be around a buck a share.

NASDAQ:VLNC – Valence Technology Inc.
Market Cap: $291.03M
Shares Out: 113.68M
VLNC - Yahoo Profile
Valence Technology, Inc., engages in the commercialization of phosphate-based lithium-ion rechargeable battery technology, known as Saphion.

Market Cap: $236.22M
Shares Out: 60.41M
DYAX - Yahoo Profile
Dyax Corp., a biopharmaceutical company, engages in the discovery, development, and commercialization of biotherapeutics for oncology and inflammatory indications. It uses drug discovery technology, known as phage display, to identify antibody, small protein, and peptide compounds for clinical development.
Dyax Corp. has sold Sanofi-Aventis SA rights to develop antibody drugs for a potential $500 million in license fees and milestone payments.

Some other issues which I didn't include because the charts didn't quite look ready were: MOSY, JDSU, RFMD, and NTWK. Also I decided not to include issues from the financial sector, although IMB, ABK and MBI look like they could easily double if they don't go belly up first.

Disclaimer: I trade the 10 minute chart, holding for two to five days max. I may have a long or short trading position in any of these issues at any time. I am currently holding a small long term position in DROOY.

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