Stenzrob's specials

[stocks54]

HBIO

Hello Stenz,

Do you think HBIO is a good buy at $8.50 or do you expect it might go down a bit?

Regards,

[FundaMental1]

SNCI - Stenzrob

Stenzrob,

Thanks for the info, I always appreciate well thought out responses. A 35x PE seems reasonable for a company that is rapidly ramping up its EPS numbers, but my only concern is that it is a forward PE and investors may not give the Company credit for much more than that multiple (until of course the company reports another quarter or two of great earnings/top line growth). I agree though, that this could be a $20 stock in a year if they continue to execute, i guess it's all about april 27th and their next earnings release. Do you have any thoughts about the next earnings release, it always makes me nervous to buy so close to earnings? Thanks.

[tokyojoeskid]

hbio

You could probably get to the 7.75-8 range before it starts another run up to 10. Seems like its stuck in a rut, easy money? who knows good luck
tjk

[stocks54]

HBIO

Thanks tokyojoeskid,

I have been riding it up and down for last couple of months and looks like a good strategy would be to hold core position and trade extra position...Like Stenz suggested....

Thanks,

[stenzrob]

Re: HBIO

Do you think HBIO is a good buy at $8.50 or do you expect it might go down a bit?

After selling the last of my short term HBIO at over $10, I entered a limit order to get some back again at $8.50, which filled today. I picked that number earlier this week because it was the top of the $8-$8.50 range it had been stuck in for a week during the weakness last month. Glad to have those extra shares back.

I had also lightened up on WITS at $14, and a limit order at $12 replenished those shares today, too.

[stenzrob]

Re: HBIO

... looks like a good strategy would be to hold core position and trade extra position...Like Stenz suggested....

I learned that from wormsmall, who dropped by here briefly a few months ago - just giving credit where it is due.

[stenzrob]

Re: SNCI - Stenzrob

A 35x PE seems reasonable for a company that is rapidly ramping up its EPS numbers, but my only concern is that it is a forward PE and investors may not give the Company credit for much more than that multiple.

That's exactly why valuation is only part of the story, and to gauge sentiment, all we have to go on is technicals.

Do you have any thoughts about the next earnings release, it always makes me nervous to buy so close to earnings? Thanks.

I have no real thoughts about the next earnings release, and you should always be nervous about them. I have held through earnings on many stocks - been pleasantly rewarded by gaps up on some, beaten with a stick on others (see LENS for one of my wrongest and most painful guesses).

[stocks54]

Re: HBIO

... looks like a good strategy would be to hold core position and trade extra position...Like Stenz suggested....

I learned that from wormsmall, who dropped by here briefly a few months ago - just giving credit where it is due.

wormsmall, stenzorb ----- thank you both. SNCI looks good as well

[stocks54]

Forsee any stock like TRCI

Hello Stenzrob,

Of all you holding do you for see anyone will have similar pattern as TRCI. I did not buy TRCI but it sure was fun to see it ride up and down... will definately like to capitalize on any opportunity like that.....

Regards,

[stenzrob]

Re: Forsee any stock like TRCI

Of all you holding do you for see anyone will have similar pattern as TRCI. I did not buy TRCI but it sure was fun to see it ride up and down... will definately like to capitalize on any opportunity like that.....

I would love it if more of my holdings behaved like that one did. That was a LOT of fun!

How did I select it? By using my screen for high revenue growth, reasonable valuation, and good relative strength with increasing volume. Look at a one year chart, better yet a two year chart - what did TRCI look like back then?
http://stockcharts.com/def/servlet/SC.web?c=trci,uu[h,a]daolyiay[de][pc50!d20,2.5!f][vc60][iLa12,26,9!Lp14,3,3]&pref=G
Under $5, volume seldom over 100k until it was approaching and then breaking through $5. Repeated bounces off the 50 day ema all the way from $2 to $20.

Looking at my current holdings and my current gain/loss position in them, it's probably a little hard to believe that they look now like TRCI did a year or more ago, but they do (in various stages).

PDEX - I bought this at $3, and it's close to $2 now.
http://stockcharts.com/def/servlet/SC.web?c=pdex,uu[h,a]daolyiay[dc][pc50!d20,2!f][vc60][iLa12,26,9!Lp14,3,3]&pref=G
But, look at the volume that drove it to $2, then to $3, compared to the volume it's been dropping on. Look at a three year weekly chart -
http://stockcharts.com/def/servlet/SC.web?c=pdex,uu[h,a]waolyiay[df][pc10!c50!f][vc60][iLa12,26,9!Lp14,3,3]&pref=G
This is what TRCI was doing a year ago. (Sort of - one difference is that TRCI had a multi-year base.)

Look at the fundamentals - nearly 30% revenue growth, no debt, PE is 35, p/s is 1.35. This is where TRCI was a year ago. The revenue growth continued, and the p/s went to 5. Makes for huge gains.

Look at institutional ownership. TRCI is currently showing 29% inst. ownership, at 1,645,663 shares, an increase of 1,236,160 during the quarter ended 12/31/03, with a lot of new holders. So up to last September, inst ownership was less than 10%. As I've said here before, if institutional ownership is low, pretty much the only thing that institutions can do is buy. Current institutional ownership in PDEX? only 5%, and that's an increase from the previous quarter.

It is left as an exercise for the reader to do similar comparisons for my other holdings - some will look very similar, some less so. SNCI also looks very good to me. Some will be turned off by the high PE, but as I've said before, PE is useless as a company is breaking through to profitability - look at revenue growth, gross margin, and price/sales for a better handle on valuation.

Using this selection criteria, some stocks will have HUGE returns like TRCI, some more quickly than others, and some will go nowhere. Last year, I had returns of over 100% on several stocks, and some that I gave up on too soon (like GORX and MTEX) went on to score that well without me. I am convinced that my selection criteria works very well on a statistical basis - a large percentage of the picks go on to very large gains, eventually, IF nothing goes wrong with their execution. QVDX slipped up on execution but I escaped before the shit hit the fan, LENS slipped up on execution, and was my largest loss last year.

The other important point about my incredible profits in TRCI is that I did not sell the original $6 position at a 15% profit, or even at 150%, but held until my price/sales target was reached, which also coincided with an earnings report that showed a deceleration in revenue growth.

[stocks54]

Thanks

Thanks Stenzrob,

I have core position in PDEX. I will be adding additional position now and then when opportunity arises....

Regards,

[stenzrob]

HSKA also looks very similar to PDEX. In fact, the three year charts are almost identical.

By the way, as Ernie knows, my method is derived from reading several articles by Kevin Kennedy, aka Coolcat. I believe his method is almost entirely technical, looking for high relative strength and new highs on high volume, with a buy point on lower volume pullbacks of 25 to 30%. Something like that. I added to that my revenue growth, financial stability and valuation criteria to give me a warm fuzzy, and to provide a reason for the price strength. I also play around with other criteria. The question was raised earlier here about my 6 month RSI criteria being higher than the 3 month - and the answer is that the pullbacks tend to kill the shorter term RSI. So unless I made a note of those stocks before the pullback knocked them off the list, I would be unaware of them at exactly the time when I should be looking at them.

The one thing that stuck with me from those articles though, was the very basic concept of looking for common characteristics of stocks that made the biggest gains in the previous year and then using that to try to identify the next ones. (Ernie follows the same kind of process to identify stocks with a very high probability of returning 15% in four to six weeks. The process is very similar, but the objective of the search is different. This is why my picks and Ernie's are seldom the same) When I first read those articles about a year ago, a few of the examples used for the year prior were SOHU and NTES. And what have those two done this year? - nothing much. The reason I mention this again now is that it is perfectly appropriate for us to look back at TRCI, what made me select it and what convinced me to sell it. I continuously revisit my past trades, successful and not, to try to learn from them. Constantly asking myself, what did I miss about stocks that did poorly, why did I sell that other one too early, why, why, why? Not because I'm beating myself up over them or suffering from investor angst, but to learn. I've only been doing this since January 2000, so what I've mostly learned is fear, though last year was an exercise in balancing the fear with the greed.

regards ... stenz

[stocks54]

Thanks

Thanks Stenzrob,

I agree...reviewing the previous transaction would give better understanding.

It’s the part were you need patience that kills me…. like most I want the stock to shoot up quickly….I hope I can control that emotion…

Regards,
Dev

[tokyojoeskid]

yahoo weird

hey stenz did yahoo take our posts off the hbio board, for some reason i swear i posted something about ah and you replied and i just looked at the board a second ago and they are both gone???
hmmm
might just be my old computer playing tricks on me
tjk

[stenzrob]

Re: yahoo weird

hey stenz did yahoo take our posts off the hbio board, for some reason i swear i posted something about ah and you replied and i just looked at the board a second ago and they are both gone???
hmmm
might just be my old computer playing tricks on me
tjk

Still there for me. Your post #1500, my reply #1501.