I closed out my JNIC position for a nice 16% profit.

So far on the bottom feeders I have taken nice profits on PRCP and JNIC, and took a small loss on PRVT.

DHB seems to be kicking ass today, too. I still own ACTT, VPHM, and DHB.

DHB has had a very impressive recovery in assets and stockholder equity.

net income also impressive.

Growth rate is low, but so is the PE.

One would think that there next quarter would be very good.

Damn Kendricks, why do I get sucked into this stuff?

A belated Dow 8395

I rolled my JNIC position over into EELN.

Go baby!

Damn T_Bone, you are a pain in the ass!!!!

A belated Dow 8395

All right, Kendricks is going for 8791!!

Ldvee-I'll guess I'll bet on an up week too,

8600, a bit more than 3%.

8500 for Ben.

Did you jump onto the DHB bandwagon, Ben?

NO

that stock was $2.09 a month ago and closed today at $3.69. Up 76% in the last 30 days. I guess I am a little late??

It was selling for $8 a year ago. It was pounded down to nothing, and is now rebounding with a vengeance on killer news.

Just as Jesus resurrected Lazarus, and was later resurrected himself, DHB has come back to life from the grave, o ye of little faith.

Jesus and I love you!

Speaking of Jesus, you might enjoy the Oyster thread on the SURE board...

I jumped into WINS for a quick bump, too. Vamos por arriba!

OK, now that the manic high is over (I think) I have returned to thinking a little more calmly.

CHINA is a great stock that will definitely rise from current levels. It is a SURE thing.

UBET is on its way up, too. It is a SURE bet!

Kendricks I SURE would like a break.

I'm a milquetoast loser >8^(

Can't believe those yahoos take you seriously.

LOL! I especially liked the "moral equivalent of sodomizing your baby brother during a Satanic ritual" post!

Here is an interesting article on low priced stocks, hot off the press:
http://cbs.marketwatch.com/news/story.asp?guid={0E8C9AD7-B4E1-4D46-8A3F-E8A79DD89B42}&siteid=mktw&dist=nbs

As I mentioned in a previous column, winning stocks continually exhibit similar characteristics. Among the winning ingredients: a low trading float, a low market cap and stock price, along with high relative and industry group strength, the presence of new 52-week highs and the sudden appearance of big trading volume.

To show how this works, I took a quick look at the top 20 performing stocks on a percentage basis over the past year as of April 17. The top performer has been NetEase.com (NTES: news, chart, profile) with an eye-popping gain of 2,285%. The 20th-ranked stock was Rediff.com (REDF: news, chart, profile), which has risen 244% in the past 12 months. I eliminated Bulletin Board stocks - that that trade under $1 and haven't traded on one of the three major exchanges for the full 12-month period.

My search is to find the stocks that could become the next NetEase.com, and the way I attempt to do that is to develop stock screens, which require stocks to have the same characteristics as past winners. Let's see what these 20 stocks had in common:

Eighteen of the 20 stocks were listed on the Nasdaq or Nasdaq Small Cap exchanges. The other two top performers were from the American Stock Exchange. When it comes to looking for big winners, NYSE stocks need not apply.
Eighteen of 20 were priced below $5 when they made their first 52-week high. Of those, 11 were priced in the $1-2 range when they broke out. Eighteen of the stocks had a 52-week low of $1.25 or less when they made their first new high.
Eighteen of 20 had less than 50 million shares outstanding, 17 had a trading float of less than 30 million shares, and 17 had a market cap below $100 million.

Here's one for you, VIFL, I think they have 10 employees. Easy 2 bagger if/when FDA approves RTE and they don't go broke first. I made a few bucks on it several years ago when the FDA approved electrocution for beef.

For some reason I've had CRIS on my watch list. And that's what I've been doing, watching, tsk, tsk.

Did one of you guys mention it?

I wish I had a part of CRIS's 100% runup yesterday, but sadly, I did not. I do have VPHM, though, which is having an awesome day!

I just locked in a nice profit on VPHM. It might go higher, but that one seems really speculative to me, so I just took the quick gain.

VIFL has possibilities, but I'd like to see a breakout before I committed money to it. I don't like to see my cash languish.

Fuck, what a rush! Well, I took profits on UBET, ACTT, and the other ones I mentioned, and ate a small loss on WINS and EELN. I still have DHB. Very exciting, to say the least.

OVER and SKX both came out with shitty earnings, but I'm just going to sit tight and continue to sell calls on those. I also had covered call trades on ECLN and BFT that are working out.

Now that I am temporarily in control of my emotions again, I think I am going to stop gambling on short term price action, and actually go back to doing some research on some low priced stocks that I think have good potential, and soberly entering them at good entry points - as well as continuing with my covered call strategy.

CHINA and DHB I think have good potential to move up from here, but I am going to self impose a moratorium on entering new trades for the rest of the day!

Is anyone interested in carrying on this conversation? If not, I'll just give it a rest. I seem to be the only one who posts here about trades anymore, so maybe I should just take my ball and go play elsewhere.

You may be talking to yourself. I do very little trading and Ben has been real quiet lately.

I think I am. Oh well, I'll catch you guys later. Good luck to you all.

Maybe we should switch to a topic that interests me and perhaps other 50+ mongers. I've got a great job that not only will I work for the next 10 years, but I want to work for the next 10 years. I'm currently spending all that I make and having a great time. Thinking that if my current investments double in the next 10 years I'm set.

Do you think that's a good bet given that my portfolio pretty much mimics the dow?

I guess the question is what is the probabilty that the DOW will average +7% per year over the next 10 years? Also, what's the plan for moving from stocks to bonds as the years go by?

This is complicated but I have to figure it out.

A discussion would be good.

Sorry, I have no interest in that discussion. You and the 50+ guys who are interested in it can carry on.

Now wait a minute Kendricks.

I have been following your recent posts with interest, but I admit it is not my style of investing. I am trying to keep an open mind, but history and my personal experience is that buying these cheap stocks is usually not productive. It is more luck than skill and since the market has been moving up for the the past couple of weeks it has had a definite benefit to your strategy.

Ldvee,

A very complicated question!

I think your assumption of 7% compounded over the next 10 years is very realistic regarding the Dow. If possible have all dividends automatically reinvested(very important).

Just because you are retiring in ten years doesn't mean you are going to die in ten years. Now if you will have enough money in ten years to live the rest of your life with out running out of money, then put it in bank cds and bonds.

Today a typical retirement last 20-35 years, but in your case(since you smoke) figure only 10-15 years.

If you are going to need growth for a hedge against inflation you might consider putting like a third in cash, a third in bonds and a third in equities. This formula will vary dramatically depending on how much income you need, the amount of assets you own, etc.

Ken Ken keep posting you stock selections por favor. I have been to TJ the past three days and have not been around much to comment on your posts.

BenwhoknowsforSUREthatspeculationisnotinvesting

I'm figuring that IF I average 7% and re-invest over the next 10 years I'll have enough to maintain my lifestyle for as long as it takes assuming a 6% to 8% return on principle after retirement.

Certainly not spending everything now and socking away more would increase the retirement funds, but man I'm having mucho fun whoring, buying fast cars, and travelling now!

It's a trade-off between fun now and security later.

In order to average 6-8% during retirement you will prbably need a certain amount of equities.

Historically:

bank cd's 3-4%

Long Term Treasuries 4-5.5%

stocks 8-9%

I did not look up the actual returns, but these returns are guesses based on the past say thirty years.

Damn,

It looks like T_Bone is going to win again.

OK Ben, I just wanted to make sure that someone was actually reading this shit I am posting. I don't care whether or not anyone thinks my picks have merit, if anyone actually likes my strategy, etc. - I just don't want to be posting if no one is interested!

I took profits on DHB today, so overall I have made $$$ on PRCP, JNIC, DHB, UBET, ACTT, and VPHM, (am I forgetting anyone here?) and took a minor loss on PRVT, WINS, and EELN.

I bought CHINA and PMID this morning. My reasons for buying these are:

1. Both of these show upward momentum, are selling for new 52 weeks highs, and are breaking out above 50 and 200 day moving averages;

2. I think that both of them represent good value at the price they are selling for, and have legitimate long term potential;

3. I really like Chinese girls; and

4. PMID makes a killer Pale Ale and IPA.

Of course, if either of these break support or show signs of going into a downtrend, I will be out the door in seconds flat.

I do intend to slow my trading down a little bit, and try to stick with stocks I would feel comfortable holding for longer than an initial bump upward.

With SARS scare you might want to be careful with China. It also has moved up dramatically over the last two months and one would think there would be some profit taking.

PMID is going from barely making a profit to barely breaking even. I see no compelling reason why one would want to own this stock.

Last year I mentioned my favorite stock, NYB, which I have continued to accumulate and write "out of the money" options.

I am now in the stock at $24.68 and will be given a bunch of shares in May on a 4 shares for every three shares stock split, plus they just increased their dividend for the third time in twelve months. That is way I like to invest. Invest on the fundamentals of a profitable well-managed company in which management seems to be very sensitive to its stockholders

I am not trying to insult or put down your invest strategy, I am just trying to say that what you are doing is very risky in my opinion and you would be better off buying good companies and not cheap stocks.

I don't take that as an insult, and appreciate the feedback. Here is my thinking, which very well may be flawed.

PMID has just moved up above what looks like very solid support at 3. CHINA is in a definite uptrend, and does offer what I believe to be great upside potential, along with the risks.

I would agree that what I am doing would be risky, if it were with substantial sums of money. However, I am just trying some ideas out with a relatively small portion of my account - most of my money is (relatively) safely being used for covered call trades.

Of the relatively small portion of my account that I am dedicating to the bottom feeding strategy, I am dividing the funds in such a way that I can have about 6 of these trades open at a time.

If this strategy works out, it will eventually grow into a worthwhile sum of money, and I will start doing it on a bigger scale (with the funds I made using this strategy, should they ever materialize). I haven't taken my eye off the big picture. If it doesn't work out, I still have most of my money in much safer trades.

At the stage of my life I am in, I am still adding to my accounts with money I earn, and trying to grow my accounts into something substantial with compounded gains over time. Anything I could potentially lose on stocks like CHINA or PMID could easily be replaced.

So, I view these low priced stock trades more as venture capital than my retirement fund - which I definitely agree shouldn't be risked in large quantities on stocks like CHINA or PMID!

Please keep posting your comments, don't worry about offending or discouraging me! I have learned a lot from you, and hope to continue to do so.

(Message edited by kendricks on April 25, 2003)

One thought that just occurred to me: I should be paying more attention to earnings momentum as well as price momentum in these trades.

Price momentum had a lot to do with the wild price increases of the mid 90's when many people who knew little about investing thought they were investment experts. Earnings momentum was discounted and even distained by many investors during that same time.


Ultimately, I believe earnings growth/momentum has more to do with stock price appreciation than any other factor.

It is official:

T_Bone wins.

Congratulations Mr.T and please get your Dow number in before the market opens on Monday as we have a new 100 point penalty rule for you if you get your number in after the market opens.

Ben picks a Dow 8150 for next week

benwhoistiredofT_Bonewinning.

8349 next week for me.

I'm still playing with my formula. They may be hard to find, but a low priced stock that has good earnings growth, price momentum, and is selling for good value would seem to be a winning ticket.

There are very low priced stocks that skyrocket - learning to find them is, in my opinion, a worthy goal.

I agree regarding your goal. Please post your selections ASAP and i will give you my two cents.

OK, I plan on doing some research over the weekend, and will post anything I come up with. This really gets to be an obsession after a while....

This might help:

http://www.nasdaq.com/asp/symbols.asp?exchange=SCM

Thanks for the link. In the mean time, I came up with an interesting idea. I'm not going to put any money on these, but if they work out, I think I could be onto an interesting formula.

On a down day in the market, GADZ and BRID, two stocks that had been beaten into the ground, were both up. Could this be a sign of strength, and at least a short term rebound? Neither of these stocks has any debt problems, and both are selling for good value.

I will be watching these two with great interest next week, and if they work out, I may start looking for this kind of trade to jump on.

This is not your style of investing, but APHT and IDEV are interesting speculative biomeds.

From what I have been reading today, I think the timing of my CHINA trade may have been very bad. I may close that trade out on Monday, but will have to see. If it does get beaten down by shorts, it could be a good stock to ride up in the future.

Of the two, I definitely like BRID better.

They look like they are ready to make a profit in the next quarter and the current assets are 4 times the current liabilities. They also pay a dividend of twenty cents a share which is 3% on your money.

It looks like BRID is returning to profitability. Apparently, one of their big customers went bk over the past year, but it appears they are recovering. It is also beat down close to its book value. Also, it has been around for over 50 years, has no debt, and as you pointed out, has current assets 4 times the current liabilities. I'm starting to talk myself into this one....

Of the others I mentioned, APHT is way too speculative even for me. IDEV is interesting, though, and something I might put a bet down on.

I also like GADZ. It's stock was beat to hell, is selling for way below book, and is taking off from its lows like a rocket. Plus it has a ton of cash, no debt, and over three times assets to liabilities.

I just might go for BRID, IDEV, and GADZ on Monday, depending upon how they open.

I've been up all night researching stocks. I really like AH and CE. Of course, I'll need to revisit these after I've had some sleep before I make any decisions....

Big customer I think was K Mart.

I think I'll just wait and watch BRID and AH for the time being, but I do like IDEV, GADZ, CE and possibly BFT.

I found a couple of others I like a lot - CERG and MXT, and maybe KG. CERG is probably my favorite, though.

Kendricks,

Just saw on yahoo that you might be buying??? Their 1st qtr earnings release and conference call is later than usual. Hmm, facts:

1. The Vietnam deal is on hold because SARS resulted in halting the project, all employees called back to US. On the other hand Vietnam just announced SARS is contained.

2. Saudi deal on hold because of the war. However the war has ended.

3. The recent drop was due to no revenue from those projects.

4. Looks like using irradiation for dis-infestation of imported fruits and veggies is being encouraged by the gov.

The following is from a recent change to a FDA Manual "The online version of the Fruits and Vegetables Manual has been revised and now includes a new option for the cold treatment and fumigation of fresh fruits and vegetables for most fruit flies and some other pests. This new option is irradiation. Therefore, wherever fruits and vegetables could be made admissible through fumigation and/or cold treatment, you will now see an irradiation schedule added. "

5. An announcement of the new CEO will be positive.

6. The first week in May there is a big industry trade show in Chicago. Pro-irradiation FDA officials will be speaking.

7. Volume is back to normal and it's moving up.

8. Approval of irradiation for RTEs is coming however it's a lot like the sign at my corner bar "Free beer tomorrow".

So who knows?????

Ben picks a Dow 8150 for next week.

Kendricks 8349 next week for me.

Ok guys where are your picks?

Damn, I should have held on to WINS. Up big today.

I'm not buying SURE yet, although I could at some point. The whole basher thing was getting old, so I decided to come out with my "A-OK with God" post. I wonder what percentage of people in there know I'm putting them on, and which ones truly think I am whacked? What's your handle in there, ldvee?

I got out of CHINA today, just because of the SARS scare. I think this company shows great future potential, though, and will be watching it.

I also bought some CERG and IDEV this morning.

I don't post on stock boards anymore, well maybe once-in-a-while. A couple of years back I posted on a stock board frequently and there was a lawsuit that resulted in yahoo giving the parties log-in info. I didn't like that action at all.

Could happen here at CH too, that's why I'm glad there's no talk about US prostitution. Never underestimate the power of our Puritan heritage.

I'm really beginning to think that the Tommy Franks drive-by shooting action in Iraq and the new US presence in the ME is going to stabilize the whole area and that may be the best thing Bush could do for the economy.

Por eso, an optimistic DOW 8500.

It better keep going up. I'm finding moderating the puta addiction about as easy as giving up cigarettes.

Ben picks a Dow 8150 for next week.

Kendricks 8349 next week for me.

Ldvee Por eso, an optimistic DOW 8500.