My Own Analyst

Weekend Update - 8 Straight Weeks Up Edition

The market was basically flat for the second straight week, but technically higher.  I have long been pointing to big psychological resistance of 1800 on the S&P 500 (the high on Friday was an all-time high of just under 1814, with a close of 1805).  It was a pretty typical holiday-shortened week, with low volume.

Looking at the watchlist ( Download Watchlist112913 ), 70 of 100 closed above the 10dma.  There were no 10% movers.  Oversold names include IRG and EZPW, with EPL, CLH, ANV, NEM, SEI, CSCO, RMD and MSM more than a unit oversold.  CTRX, GWW and LAYN jump out on the moderately oversold "prospects".  Black 1s dropped to 10 (more on the way in two weeks, though), with only ANV a black 5.  Names offering 35% or more to my one-year target include the same three as last week:  ANV, PLCM and BCEI. 

On stocks in the models ( Download Positionwatch112913 ), I adjusted a few targets. CHS dropped slightly on lower estimates.  QCOM lifted slightly.

Weekend Update - 7 Straight Weeks Up Edition

The gain was tiny, but it was another winning week.  We broke thought the 1800 ceiling (and 16K on the DJIA), but I don't think that the grinding highs are consequential.  I am still expecting a pretty tame close to the year and am sticking to 1740 close, which implies a down December. 

Looking at the watchlist ( Download Watchlist112213), 69 stocks closed above the 10dma.  10% losers included ANV and BCEI, while gainers included RAVN, which broke to an all-time high.  FL too broke to an all-time high, but its gain was modest.  Stocks offering 35% or more to my one-year target include ANV, BCEI and PLCM.  Oversold names include IRG and EZPW, and, to a lesser degree, EPL, CLH, SW, ANV, CSCO, MSM, IIVI, NEM and AVP.  On the prospects, I would point to VMEM, a failed IPO that was clobbered Friday, and LQDT.  Others that are moderately oversold and worth a look are CTRX, LAYN, GWW and RTIX.  Black1s fell slightly to 12, while ANV is the only black 5.

Here are the stocks in the models :   Download Positionwatch112213

Lots of News

FL had a nice quarter - looks like huge breakout potential.

HAYN looks nasty - locked into bad nickel price

SMCI - Davidson initiates with a 18.50 target (Buy)

I added PAY recently to the watchlist - Jefferies bullish and goes 21-29.  This is a CEO change story - really like the guy.

Weekend Update - 2013 Peak Edition

Who knows exactly how things play out, but I don't expect to be significantly wrong on this one.  The 1798 close is near where I think the market is capped (1800), and I think that we could back-fill just a little here.  As I look to 2014, while I expect more of the same (slow economy with modest growth, a little PE expansion), I think that the low for 2014 will not be the first day of trading either.  I dont see a huge amount of downside and expect that with about a 1740 close that I still project, 1600-2000 should constrain the trading next year, with a close of 1968 based on 16 PE.

As far as technicals, I can't find too much support for much of a pullback or for the rally to peter out.  As far as when the market goes to "black 1" that will not be until .  In terms of price momentum, SPY is 0.44, while IWM is just 0.13 after some recent underperformance.  SPY won't possibly be black 1 until January.

This week, the watchlist ( Download Watchlist111513 ) had 78 names close above the 10dma, a little cautious.  I should note 4 changes, with ATX, EGOV, HP and PLPC out and AEO, EPL, GWPH and PAY in.  There were no 10% losers.  GWPH, a biotech focused on cannabis-based therapeutics, soared (after my article perhaps), while PBI continues to make me look foolish for booking the gain and hoping to get back in.  I underestimated how much this story would resonate with investors - not much changing there in terms of the numbers (just the valuation). Black 1s now number 13.  35%+ opportunities include the risky ANV and also EPL, PLCM, BCEI and AVP.  VOLC dropped off. Oversold names include IRG and EZPW, while those more than 1 unit oversold would also include SWI, IIVI, EPL, AVP, DORM, CSCO and ANV.  On the prospects, I would also point to LAYN, CTRX,  and RTIX. 

Here is the spreadsheet for the positions in the models ( Download Positionwatch111513 ).  I updated a few targets.

JBL

Carlos asked:  Trash or Treasure.  I like it at $20, down on CSCO.  Plus, it's based in Florida!

CSCO and NTAP

CSCO slammed on weak guidance.  Support at 21 area, not too far from where it traded last night and very early this morning.

NTAP had a solid quarter - small sales miss mainly due to government shutdown but excellent margins.  I lowered my target very slightly to 52.50 and think a 39 entry would be good.  I see good technical support there too (37-38 even better).

Weekend Update - End of Earnings Season Edition

The market didn't take out its highs from late October, but it rallied this week and looks solid.  I expect a holding pattern the rest of the year.  The things I look for to suggest caution aren't there - we aren't overbought or extended.  Neither the economic cycle (when will the recovery actually begin?) nor valuation are really issues.  Commodities are weak but not so weak as to be flashing a red light.  Bonds are not competitive yet.  Currencies are well behaved.  

Looking at stocks on the watchlist ( Download Watchlist110813 ), 56 finished above the 10dma.  PRIM rose more than 10% on earnings, while EZPW, IRG and PLPC were pounded on their releases.  I will probably remove PLPC from the watchlist.  Also coming off will be ATX, which agreed to sale at 21.50 to French company Essilor.  On the oversold list, EZPW is at -3.51.  IRG is worse, but this is mainly due to its short history (the calculation typically uses 5 years of data).  Between -1 and -1.79, from most to least oversold, are IIVI, SWI, AVP, CPRT, MSM, DORM, ANV and VOLC.  On the "prospects", LAYN is more than 2 units after a convertible note sale.  Other names that look interesting and that are more than a unit oversold are RTIX, AIT, CTRX, TCAP and AGN.  Black 1s remain stubbornly high at 15, while ANV is the only Black 5.  AVP and BCEI joined ANV, VOLC and PLCM as offering 35% or more to my one-year target, while TITN and NTAP fell out of this category.

On the positions in the models ( Download Positionwatch110813 ), I lowered the EZPW target to 9PE and $2, dropping it to 18 from 27.  

EZPW

My bad sticking with these jokers...  They wrote down their investment in A&B, so it looks worse than it was, but they still had a bad quarter - barely profitable.  The stock is very cheap, but these guys are incompetent at best, maybe criminal.  I should have exited already and am glad I didn't add to it.

Weekend Update - Earnings Season Central Edition

Drowing in earnings season...

I still expect a 1740 year-end close with a 1650 potential low now (up from 1550) and a 1800 potential high still.  I am looking for 1968 next year based on 16PE and 6% EPS growth.  I have begun to talk more about how great a role tax-avoidance will play over the next two months.  Some big losers will remain under pressure, so we need to avoid the bottom-fishing temptation until late in the year.  Some big winners will be slammed as 2014 begins (taxes and window-dressing).

On the watchlist ( Download Watchlist110113 ), 41 stocks closed above the 10dma, correcting the more extreme reads.  With earnings season as a driver, there were several big movers.  VOLC, AVP (horrible quarter with a real scary new challenge related to the FCPA settlement talks going poorly) and IIVI (dilution from Oclaro pretty bad) got slammed, while BGFV, PSMT, PBI and POWI all responded with a >10% pop following their earnings reports.  Oversold on the watchlist run from VOLC (-1.58) to CPRT (-1.00), with IIVI, WSM, IRG, DORM, NEM, EZPW, CAG, MSM, AVP, ISRG and CVX in between.  On the "prospects", RTIX and HMSY are more than 2 units oversold while some others between -1 and -2 include:  CTXS, BJRI, CTRX, EW, BOKF and CAS.  Black 1s number 15, while only ANV is a black 5.  Stocks offering 35% or more to the one-year target include ANV, VOLC, TITN, PLCM and NTAP.  

Stocks in the models:  Download Positionwatch110113