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Market Stance: BULLISH (since April 10, 2018)
* An average of managed accounts, net after all commissions and fees.
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* Buy prices shown are net after commissions and fees.
Today, Friday, April 27, 2018, I bought BOOM, for both client and my personal accounts.
Here's why I bought this stock:
+ Huge earnings surprise: Yesterday, April 26, after the close, the company announced results for the quarter ended March 31. Earnings came in at 49c per diluted share (vs a loss of (21c) last year and analysts' consensus 22c). Revenue was up 73% to $67.3 million (analysts' consensus $60.0 million).
+ Volume spike, mostly on the buy side: As I write this, about half an hour before the close, volume has already more than doubled the previous 12-month record.
+ Excellent and accelerating recent sales growth. Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +14%, +43%, +36%, and, most recently, as cited above, +73%.
+ Excellent recent earnings-per-share growth. Here are the quarterly EPS figures for the last eight quarters:
Jun 17 vs Jun 16: 4c vs (4c) Sep 17 vs Sep 16: 22c vs (19c) Dec 17 vs Dec 16: 9c vs (15c) Mar 18 vs Mar 1u: 49c vs (21c)
+ Strong and rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2018 is $1.26, revised upward from $1.00 90 days ago (and up from 2017 actual earnings of 16c); and the consensus estimate for 2019 is $1.90, revised upward from 15c 90 days ago.
+ Valuation: At 21 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 20%, the stock is, by my usual metric, reasonably priced.
+ The company's industry group ("Metal Proc & Fabrication") is ranked #105 for relative strength out of 197 industry groups tracked by Investor's Business Daily. This ranking changes daily, and it has been generally rising over recent weeks and months.
+ The stock's 200-day moving average is rising, indicating a long-term uptrend.
-KD, Friday, April 27, 2018
* Buy and sell prices shown are net after commissions and fees. This means that the gain/loss shown is also net after transaction expenses.
Today, Friday, April 27, 2018, I sold IVV, for both client and my personal accounts.
I sold just enough IVV to pay for BOOM. We remain fully invested.
-KD, Friday, April 27, 2018
* Buy prices shown are net after commissions.
** Current prices are at least 20 minutes old.
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