Something About ALD

Ready to break above short-term overhead resistance, ALD appears to be primed for a move up.

Allied Capital Corporation (ALD) is a private equity company focusing on buyouts, acquisitions, note purchases, recapitalizations, growth capital, and middle market equity and debt investments.

Interesting aspects are:

• Volume at approximately 2.03 million average shares/day
• P/E is at 11
• A dividend of 17.6% (could be cut in the near future, if so we may see a dramatic sell-off)
• Current price at 52.5% below the 52 week high
• Steady earnings expected for '08 and '09
• Insider buying since early June
• A .65 dividend coming up on 9/10/08

Closing on Friday at 14.75, I am willing to call ALD a buy.
.

Tail Winds at GE?

At a time of erratic behavior in the market, a safe harbor may be the right choice. General Electric Company (GE) appears to be a good value at these levels, selling today at 28.58.

GE operates as a technology, media, and financial services company worldwide. Its infrastructure segment produces jet engines, turboprop and turbo shaft engines, and related replacement parts for use in military and commercial aircraft; wind turbines; aircraft engine derivatives; gas and steam turbines, and generators; drilling and production systems, compressors, turbines, and industrial power generation equipment; diesel-electric locomotives; and water treatment solutions for industrial and municipal water systems. It also offers financial products and services for aviation and energy sectors, as well as engages in gathering, processing, transporting, and marketing natural gas and gas liquids.

On a long term view, GE is well positioned in the wind turbine sector (alternative energy), water treatment and energy efficient aircraft engines.

At about a 31.3% discount from its highs of late September '07, P/E of about 13, a 4.3% dividend, massive average daily volume, and worldwide exposure and recognition; I would not hesitate to take a long position in the company.
.

TKC Could be Forming a Base

Turkcell Ilet (TKC) has been losing ground since its highs of late November '07. After a sizeable drop in value, the stock may be hovering around a short-term support at 15.

Turkcell Iletisim Hizmetleri A.S. engages in establishing and operating Global System for Mobile Communications network in Turkey. The company provides mobile telecommunication services, including mobile voice and data services over its GSM network. Its voice services include wireless telephone services on a prepaid and postpaid basis.

Few of the attractive signs are:

• Volume at approximately 1.35 million average shares/day
• P/E is less than 9
• A dividend of 3.8% (paid yearly)
• Current price at 47% below the 52 week high
• Fund ownership has been increasing during the past 4 quarters
• Earnings have risen consistently since '01

Trading today at 15.85, I would consider TKC a buy candidate at around these levels.

.

Time to Drop AINV

Apollo Investment Co. (AINV) has turned south, broke below both the 200 and 50 DMA's in one day. The chart does not look so good.

Holding on to a 5.2% return in less than 4 months, I am ready to let go. Time to sell, this morning trading at about 16.40 down a fraction, new signs of weakness.
.

Still Bullish on USU

Six months after comments on this blog about USEC Inc. (USU) and experiencing a 27% "paper loss", we may see daylight sometime in the near future.
An article on "The Motley Fool" is like a breath of fresh air after a period of uncertainty.
http://www.fool.com/investing/dividends-income/2008/06/12/a-big-upgrade-for-usec.aspx
It will be interesting to find out if a contrarian view proves to be on target for the next move on USU.
.

AVT Bounces Back

Avnet Inc. (AVT) appears to have enough bouncing power these days to recover from the April 15th 12% drop. Yesterday's closing price of 30.33 could be viewed as a "dead cat bounce", however, the decisive break above the 50 DMA could signal a recovery.

Avnet Inc. (AVT), together with its subsidiaries, distributes electronic components, enterprise computer and software products, and embedded subsystems primarily in Americas, Europe, the Middle East, Africa, Asia, Australia, and New Zealand.

Some of the positive aspects are:

• Volume at approximately 2 million average shares/day
• Reasonable book value
• P/E of just under 10
• Current price at 32% below the 52 week high
• Good fund ownership, increasing interest for the past 4 quarters
• Earnings have risen consistently since '02

This stock could continue its upswing and bring good returns in the next few months.

.

Time to unload BEXP

Finally, after two years of weathering painful times, Brigham Exploration Co. (BEXP) has made a solid turn-around and now we are seeing healthy gains.
BEXP was mentioned on 3/28/06 at 9.20, selling today at 14.30 brings us a 55.43% return in 26 months. I'm content with those returns. Time to cash in some gains.
Patience, again, has been rewarded.
.

Charting SUG

Southern Union Co. (SUG) has been rising from its lows of mid March and is forming a desirable chart pattern.

SUG, together with its subsidiaries, engages in the gathering, processing, transportation, storage, and distribution of natural gas in the United States.

The chart shows the stock price breaking above the 50 DMA (4/25/08), holding well with a fairly strong move towards the 200 DMA and a the long term declining tops line.

Some of the positive aspects are:

• Volume at 889,000 average shares/day
• Yield of 2.3%
• Reasonable book value
• P/E of just under 15

SUG, trading this morning at 26.42, could possibly add some sweetness to a portfolio.

.

.

EDS Being Bought by HP?

Hewett-Packard Co. has offered to buy Electronic Data Systems Corp. for 25.00 per share in cash. That transaction is expected to be completed by the end of the year.
Under those conditions, we would realize a 10% return in about 12 months from the original price of 22.75 mentioned on October 10, 2007 and a 30.4% gain over the updated comment on May 3, 2008 (10 days ago) when the stock was trading at 19.17.

Fortunate for those of us who were patient enough to hold on, not panic and apply a cost averaging approach during some tough times.
.
.

Is it Time for KBE?

On October 4, 2007, I wrote about Exchange Traded Funds (ETF's). The main focus was on KBE, an ETF investing in large banks. Since then the stock value has dropped 25%, a choice that proved to be much too early for a near term profitable outcome. I have been hanging in there knowing that the negativity in the sector would, in time, reverse its course.

I would tend to think that the bottom is near and expect most banks not only survive but thrive in years to come.

It is not the time to give up, better to wait and add to a long position in order to bring the average cost down and participate in an upswing. Meanwhile, a 6% dividend should keep us in the game and with a price of 40.31 it can be a good place to reload.

An interesting article with an in depth look at KBE can be read at:

http://seekingalpha.com/article/76495-investing-in-banks-the-kbw-large-bank-index?source=yahoo

For those of you who have patiently waited out this deteriorating situation, expect better days ahead.
.
.

Is GVA Ready for a Bounce?

Always searching for value, I like to consider beaten up stocks as mid to long term investments.
Granite Construction, Inc. (GVA) appears to be promising adequate returns in the coming months.

GVA with its subsidiaries, operates as a heavy civil contractor and a construction materials producer for public and private sector clients in the U. S. Some of its projects include construction and improvement of streets, roads, highways, and bridges.

GVA is selling today at about 33.10, 55.6% below its 52 week high; an average daily volume of 888,000 shares, a P/E of 12, insider buying over the last 6 weeks, and may be ready to break above the 50 day moving average (now at 34).

Time to focus on companies that would benefit from an infrastructure upgrade surge which many states, cities and municipalities are in dire need.

Another Big Bang

With bloody noses from yesterday's action in the stock markets, we'd better be ready to face the next round of attacks from the bears.

Having the financial sector in total disarray, the diminishing value of the dollar, world markets taking hits and a recession well on it's way; I can't see any factors that would make the U.S. markets turn around any time soon. The worst case scenario would be a downward spiral, if that turns out to be, then we haven't much of a clue where the bottom could be.

Good luck, don't despair, keep the powder dry.

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.