AN IDEA FOR A SLOW DAY
If you are a small-cap or micro-cap investor that takes the time to conduct proper research and due diligence into finding your next great investment, than you will be extremely happy to read
this article from The Motley Fool.
Why? Of the 10 best performing stocks over the past 10 years, 9 of them began their runs as companies capitalized at less than $200 million. I took the time to do some math and calculated the following astonishing facts:
Their average market cap is a mere $110 million.
If you backout the largest company in the group at the time, the average market cap falls to 64.7 million
3 companies had a market cap of $10 million or less - as low as $3 million
You would expect to see names like Dell, Apple, Starbucks, etc. but they are nowhere to be found on the list. Nope, the best performing stocks started out as obscure and ignored little companies that received no attention of any kind from analysts and brokers.
There is a great lesson to be learned here. Search for companies that have achieved market acceptance for their innovative products and services, have a solid management team, reasonable share structure, a good investor relations firm (had to say it and are relatively ignored by the “experts”.
At CFRN WE’RE finding great little companies and telling our listeners about it.
Hopefully, one our companies can make this list in the next 10 years. In the meantime, here is the current list - see any names that you recognize and may have skipped over? Company 1997 Market Cap Return, 1997-2006 Hansen Natural HANS $10 million 25,538% Chico’s (NYSE: CHS) $34 million 8,773% American Eagle (Nasdaq: AEO) $78 million 7,884% Daktronics (Nasdaq: DAKT) $17 million 7,328% Celgene (Nasdaq: CELG) $111 million 6,118% 4 Kids Entertainment $3 million 5,447% NVR $191 million 4,871% Comtech Telecommunications $7 million 4,653% Best Buy (NYSE: BBY) $460 million 4,082% Frontier Oil (NYSE: FTO) $85 million 3,616%
Frontier Oil (FTO) was downgraded today by analysts at Macquarie and the stock is now at $12.22, down $0.09 (-0.73%) on volume of 1,892,336 shares traded. The analysts downgraded t...(Click the story link or go to http://www.marketintelligencecenter.com for the full story)
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BloggingStocks: Analyst Upgrades
BofA/Merrill upgraded ConocoPhillips (COP) to neutral from underperform following the better-than-expected Q2 report. The firm has a $61 price target on shares.
Deutsche Bank upgraded Citrix Systems (CTXS) to buy from hold ... Read more
Financial Select Sector SPDR (XLF) - A bearish three-legged options combination play initiated on the XLF, an exchange-traded fund designed to provide investment results that correspond to the price and yield performance of the Financial Select Sector of the S&P 500 Index, indicates one big options player expects shares of the underlying ...
XLF - Financial Select Sector SPDR – A bearish three-legged options combination play initiated on the XLF, an exchange-traded fund designed to provide investment results that correspond to the price and yield performance of the Financial Select Sector of the S&P 500 Index, indicates one big options player expects shares of the underlying fund to decline ahead of August expiration. Shares of the ETF are currently down 0.55% to stand at $14.49 with just under 30 minutes remaining before the closing bell. The pessimistic options strategist appears to have sold call options in order to partially offset the cost of buying a debit put spread. The investor sold 17,500 calls at the August $16 strike for a premium of $0.18 each, purchased 17,500 puts at the lower August $14 strike for a premium of $0.52 per contract, and finally sold 17,500 puts at the August $12 strike for a premium of $0.14 apiece. The net cost of the transaction is reduced to just $0.20 per contract. Thus, the bearish trader is poised to profit if shares of the XLF fall another 4.75% from the current price of $14.49 to breach the effective breakeven price of $13.80 by August expiration. The investor walks away with maximum potential profits of $1.80 per contract – for total gains of $3.150 million – if the price of the underlying fund plummets 17.2% to trade at or below $12.00 by expiration day in August.
VALE - Vale S.A. – Two-opposite minded options strategists initiated spreads on the iron-ore producer today. One of the investors displayed bearish sentiment on the stock by purchasing a plain-vanilla debit put spread, while the other options player put forth an optimistic stance on Vale by enacting a bullish risk reversal. Vale’s shares are up 0.70% to stand at $27.40 as of 3:40 pm (ET). The Vale-bear initiated a debit put spread, buying 7,500 lots at the September $25 strike for a premium of $1.36 apiece, and selling the same number of puts at the lower September $20 strike for $0.40 in premium per contract. The net cost of the transaction amounts to $0.96 per contract and prepares the investor to profit if Vale’s shares fall 12.25% from the current price to breach the effective breakeven point on the spread at $24.04. The put-spreader pockets maximum potential profits of $4.04 per contract if…
FTO – Frontier Oil Corporation – Shares of the independent energy company engaged in crude oil refining and wholesale marketing of refined petroleum products are up nearly 3.25% to $14.38 this afternoon. The rally in the price of the underlying stock inspired bullish options traders to purchase out-of-the-money call options [...]
See below for an answer to a question(marked with an asterisk) posed in the briefing that required follow up.
*As Mr. Brennan said, we don’t deal with Hezbollah, Hezbollah is a designated Foreign Terrorist Organization (FTO). ...
BloggingStocks: Analyst Upgrades
Piper Jaffray upgraded UPS (UPS) to overweight from neutral with a $79 price target following the company's better-than-expected Q1 results.
SunTrust believs Zions Bancorp's (ZION) tangible book value is around $20/share, making ... Read more
BloggingStocks: Analyst Upgrades
Oppenheimer upgraded Boeing (BA) two notches to outperform from underperform to reflect, among other things, the company's plans to accelerate 777 and 747-8 production. The firm raised its price target for shares to $80 from $56. ... Read more
Applied Materials (AMAT: 12.36 -0.05 -0.40%) - Above is a daily chart of the AMAT showing a breakout failure and the subsequent fall back into the base. It looks like it is gonna squeeze some shorts to me. The technical chart shows the stock is currently in the rally as %K line is rising on top of %D line, indicate buy signal. Shareholders may remain invested with a stop- loss at $12.27. Watch for the move out of either side of the triangle.[More...]
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