An Eye on AINV

Apollo Investment Corporation (AINV) could, in the near future, survive and make a turn-around despite the present financial crisis.

AINV focus on investing in the following industries: business services, cable television, chemicals, consumer products, direct marketing, distribution, energy and utilities, financial services, healthcare, manufacturing, media, publishing, retail and transportation.

The positives are: price holding just above the 50 day moving average (dma), trades over 1.3 million shares/day, sells at a 35% discount from its 52 week high, insider buying, yields 12.9% dividends, P/E at 7 and a chart that shows a possible bottom.

The negatives are: financials continuing in a decline and/or a break below the 50 dma.

AINV is selling at about 15.61 and is worth keeping an eye on.

A Look at LHO

LaSalle Hotel Properties (LHO) has been near the top of my list since the beginning of the year, it's time to take a serious look at the oportunity that this company may offer.

LaSalle Hotel Properties, is a real estate investment trust (REIT), which engages in the purchase, ownership, and lease of upscale and luxury hotels located in convention, resort, and urban business markets in the U. S.

LHO is selling today at about 29.62, trades an average of 633,000 shares daily, offers an attractive yield of 7.20%, the number of funds holding positions has increased over the last 3 quarters, has a low book value, the chart may indicate a bottom at around 27, and earnings have increased since 2003.

Expect a sustained rise in price if it breaks above the 50 day moving average at around 31.

Brace Yourselves

If the U.S. market follows the action of foreign stock exchanges, then we are in for some pain.
Expect tomorrow to be one of the worst days and this trend may continue for a week or so.
Wrong time to panic and sell. This could possibly be the worst time if you are long in the market and a good time to start looking at buying opportunities.
So, batten down the hatches, weather the storm and don't panic. Good luck.

Are You Still Holding ASVI?

If you were patient enough to stay with a long position on ASV Inc. (ASVI), then your ship may have arrived. This morning, Terex Corp. announced its intent to purchase ASVI for 18.00 per share, a premium of 46% over the Friday's closing price.

On 10/19/06 and again on 10/31/06, ASVI was mentioned in this blog as an attractive stock, originally selling at 16.60 it seemed to be a value company. The housing industry slow down, lower than expected earnings and U.S. markets sinking rapidly, managed to bring the stock price to 4 year lows. At the time, I chose not to panic and hang in there, it worked to our advantage.

For more information on the possible transaction see the following link:
http://biz.yahoo.com/ap/080114/terex_asv.html?.v=1

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.

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.

A Look at PNSN

Another dismal trading session. On a day when most stocks are taking hits, Penson Worldwide, Inc. (PNSN) seems to be holding up well.
Penson Worldwide, Inc., through its subsidiaries, provides a range of securities and futures processing infrastructure products and services to the securities and investment industry.
Although PNSN is thinly traded at around 200,000 shares per day, the chart shows an interesting double bottom at just above 15, trading today at 16.45 (53% below its 52 week high), earnings have increased since '05, P/E is at 14 and the company has a worldwide exposure.
PNSN is now providing access to U.S. markets for costumers of a leading Indian stock brokerage.
All signs indicate that PNSN is worth considering.

A Bit Early on HIMX

Timing is everything; as of late, interesting stocks have lagged and taken some tumbles along with most securities in the U.S. markets. Patience is a virtue that, often gets lost in troubled times.
I'm not giving up on HIMX; picked as a possibility on June 7 of this year at 5.18, retreated since then to the high 3's.
The company is planning to repurchase $40M of its shares, increased earnings estimates for '07 and '08. Trading this morning at 4.39 well above its 50 day moving average which was crossed on Friday with 6 times the average daily volume.
Given the strength and support shown today by Himax Technologies, Inc. on a day of broad weakness in the markets, I would consider increasing my long position.

A Look at VPHM

Painful days in the investment world, a reminder of October '87. It might be time to position some funds into out-of-favor stocks.
ViroPharma Inc. (VPHM), selling at 9.57, seems to be holding up well in somewhat sad market conditions.

ViroPharma Incorporated is a bio pharmaceutical company, which engages in the development and commercialization of products that address serious infectious diseases, with a focus on products used by physician specialists or in hospital settings in the United States.

I see some positive characteristics that could signify a favorable move in the stock price, high average daily volume, may close today above its 50 day moving average (9.49), increased fund ownership over the past few weeks, stock at 48% below the 52 week high, low P/E ratio (7) and a reasonable book value of 1.58 have made this company worth looking at.

Short Squeeze on HW?

Are we going to see a short squeeze on Headwaters Inc. (HW) any time soon? If so, be prepared to experience a nice rebound of this stock.
At this time the price is rising decidedly above its 50 day moving average on news of a feasibility study for a coal liquefaction plant in Assam, India.
If the stock holds today and builds upward momentum, those investors holding short positions on HW could be running to cover in the near future.
Trading at 15.80 today, we are at 22.3% below my original comment of 5/23/07 when it was selling at 20.41 and about even with a second mention on 8/22/07.
I like the chart formation at this time and expect positive results in the weeks ahead.

EDS Crosses the Line

Electronic Data Systems (EDS) just crossed above its 50 day moving average, normally that's a bullish sign.

Electronic Data Systems Corporation delivers a portfolio of information technology and business process outsourcing services worldwide. The company offers infrastructure services, such as hosting, workplace (desktop), storage, security and privacy, and communications services.

Today, with the DJIA down 65.30, EDS is up .15 at 22.75, showing strength on a weak market day. Note that between 7/23/07 and 8/9/07 the value of the stock lost about 20% on heavy volume, a CEO change could make a difference in the price behavior. Enough for a reversal?

With an average daily volume of over 3 million shares, a P/E of about 18, today's price at a 24% discount from the 52 week high, and improved earnings over the past 4 years make EDS my choice for "Flavor of the Day"

Large Banks are on the Move

A few weeks ago, the Fed lowered interest rates making money available and more affordable for banks and lending institutions, many of them under a dark cloud after the "sub-prime" debacle.
The financial sector has been beaten up in the stock markets and several of these companies are poised for a rebound.
A chance to take part on the positive move is buying into a Specialty - Financial ETF such as KBE.
KBE's major holdings include Bank of America (BAC), Bank of NY Mellon (BK), Citigroup (C), J P Morgan Chase (JPM), Wachovia (WB) and Wells Fargo (WFC) to name a few.
KBE is trading today at about 54.00 per share, average volume near 1 million per day, dividend was 5.28% (as of 6/30/07), and has an expense ratio of .36%; its inception date is 11/8/05.
A new investment vehicle for me, I'm willing to give it a try.

About ETF's

"Exchange Traded Funds" more commonly known as ETF's could be the successors of mutual funds. With 100's to choose, they offer a chance to buy into an industry, indices, country or commodity without the cost, management skills and paper work required to purchase individual stocks.
Generally, ETF's have fewer managers, lower costs and cover as many sectors as mutual funds.
iShares, SPDR and ProShares are some of the more popular families of funds, each offering a variety of categories.
Here are a few basic factors to consider when investing in ETF's:

• Liquidity is important, high trading volume is desireable.
• Low expense ratio.
• The family of funds should be run by a reputable firm.

In choosing an individual ETF, think of it as a stock and opt for the sector that you expect will do well in the future.

ACLS Falls Out of Favor

Stock performance for Axcelis Technologies Inc. (ACLS) has been disappointing, thus creating a not so attractive chart pattern.
Mentioned on 8/1/07 at 5.68 as a possible comeback, selling today at 4.76; I am taking this one out of my list and exiting the long position with a 16.2% loss.

Bottom Fishing for a Possible Come Back

It is difficult to focus on buying stocks when most of our holdings are taking a beating. On July 11 (as noted in this blog) there were some signs of weakness in the markets, three weeks later we are experiencing wild swings of the indices and no end in sight.
Possibly one big "dive" in stock prices in the near future may cause many investors to panic, willing and unwilling sellers will exit their long positions, and then we could resume a longer term bull market.

Holding at near a 12 month low, Axcelis Technologies Inc. (ACLS), selling today at 5.68, looks like it may start to make a base.
Axcelis Technologies, Inc. designs, manufactures, and services ion implantation, dry strip, thermal processing, and curing equipment used in the fabrication of semiconductor chips in the United States, Europe, and Asia.
ACLS trades an average of 1.3 million shares per day, a projected P/E of about 16, holdings by funds increased in the past weeks, number of funds owning the stock have consistently gone up for the last 4 quarters and a fairly low book value make this company interesting enough for us to take notice.

A. O. Smith Soars

A. O. Smith Corp. (AOS) opened this morning at a new 52 week high after reporting better than expected second quarter earnings and raised its '07 outlook.
Trading today at about 48.85 (up 4.96 for the day) makes it a 35.5% gain in a little over 7 months when on 12/7/06 AOS came up in this blog at 36.06.
I think it's time to take profits.

Rough Waters Ahead

Those of you who follow the charts realize that there is good reason to be concerned about the near term of the market.
Many stock and indices' graphs have made a definite "head and shoulders" formation. This may indicate a serious downturn in U. S. equities.
Yesterday, the S&P 500 broke below its 50 day moving average of 1513.47 closing at about 1510, if we don't get a significant rebound today, we should see further deterioration of stock prices. If so, brace yourselves for a rough ride.

Good News From CORS

Yesterday, after the markets closed, the company (Corus Bankshares, Inc.) announced a special dividend of $ 1.00 per share, sending the stock price to about 18.25 (up 1.89 from yesterdays close) in pre-market trading.
Good news for those who hold long positions in this stock.

Surviving the Blows

During the last few days, the markets have been in an ugly mood. It seems like everything in sight is getting pounded. Most of our holdings are giving up some of the gains that we, so patiently, managed to accrue.
My thought is that this is a temporary correction and, in a week or so, stock prices will resume their upward trend.
Amazingly enough, there are a few securities that are holding well under this selling pressure.
Today, Himax Technologies, Inc. (HIMX) appears to be unaffected by the general market behavior.
Himax Technologies, Inc. engages in the design, development, and marketing of semiconductors that are used as components of flat panel displays. The company is based in Taiwan, ADR's are available through the NASDAQ.
HIMX, trading at 5.18 (up .05 for the day), 12 P/E, average daily volume of 481,500; nice base with short term support at around 4.96. Management owns a good percentage of the shares so they have a real interest in the performance of the stock.
I like the resiliency it shows under the existing conditions.

Headwaters Inc. May Be Primed

I've been watching Headwaters Inc. (HW) for over 3 weeks. I think it is about to make a move up.

Headwaters Inc., through its subsidiaries, provides products, technologies, and services to the energy and construction materials industries in the United States. It operates in three segments: Construction Materials, Coal Combustion Products, and Alternative Energy.

HW is trading today at about 20.41, 31% below its 52 week high, average volume is 818,000 shares per day, low book value, moderate debt. Number of funds owning the stock has increased over the last 3 quarters. There are large short positions that could help give it a nice upside momentum if they choose to cover.