Tuesday, December 18, 2007

Getting Some Energy From USU

For over a month, USEC Inc. (USU) has been popping up near the top of my list. I think it's time to mention it in this blog.

USEC, Inc., together with its subsidiaries, supplies low enriched uranium for commercial nuclear power plants worldwide. The company also performs contract work for the U.S. Department of Energy (DOE) and DOE contractors at the Paducah and Portsmouth plants, which includes the maintenance of the Portsmouth gaseous diffusion plant in a state of readiness or cold standby, processing out-of-specification uranium, and provision of infrastructure support services. In addition, USEC provides nuclear energy solutions and services, including design, fabrication, and implementation of spent nuclear fuel technologies; nuclear materials transportation; and nuclear fuel cycle consulting services.

USU's stock (today at 9.21) has formed a base with solid short term support at around 8.00, broke above the 50 day moving average 7 days ago and has, to date, held above that line. Over 4.5 million shares trade per day, short positions amount to about 25% of the floating shares. Low debt, a low P/E of 7 and a good book value raise my interest in this company. Number of funds owning the stock have increased over the past 4 quarters.

This one could be a bargain at this price.

Wednesday, December 12, 2007

Check Out SLXP

Over the last few weeks Salix Pharmaceuticals Ltd. (SLXP) has consistently been showing up in my stock screener. Several days ago, I saw a nice change in its chart pattern, the stock price broke above the 50 day moving average and, up to date, has held steady above it. I like that behavior provided it holds above 11.82 (50 DMA).

Salix Pharmaceuticals, Ltd. engages in acquiring, developing, and commercializing prescription drugs used in the treatment of various gastrointestinal diseases in the United States.

SLXP is trading today at 11.89, 27.4% off its 52 week high, trades an average of just over 780 thousand shares per day. A heavily shorted stock (about 1/3 of its floating shares) could make an investor with contrarian views salivate should a short squeeze occur. If the stock price continues on and uptrend, shorts may head for the exits. It is early to tell if this move can carry through the next 2 months.

I am betting that this one is going to perform well in the future.