In the beginning, cell phones were just phones. And that was good enough. Now they take pictures and shoot short video clips. Or they let you play games and surf the net to download cool ring tones.
Down the road, your phone will basically be a full-fledged multimedia center – sort of like a TV, DVD player and iPod wrapped up into one. It’s all part of the evolution of mobile phone operators as they morph from being simple phone service providers to outright media companies.
There’s good reason for this change. With competition knocking the profit margins out of basic phone service, these companies know they have to move into higher-margin media content to thrive. Besides, people will always want cooler toys.
Behind the scenes, however, these new features are putting fresh demands on the guts of the cell phone. In particular, memory and processors will have to become a lot more robust and flexible.
Where will all the computing power and storage come from? Right now, industry observers are watching as phone providers re-work combinations of different kinds of memory to get the job done. One format, called NOR, is good at storing application code. Another, called NAND, is a lot slower, but it is cheaper and good at storing data – like songs inside portable music players.
A third way
A chip company recently spun off from Advanced Micro Devices (AMD), meanwhile, has been working hard using a proprietary technology to find a third way. Known as Spansion (SPSN), the company is applying a technology called MirrorBit, to create a hybrid of NOR and NAND. The hybrid is called MirrorBit ORNAND.
Spansion believes MirrorBit ORNAND is faster and more reliable than current forms of memory used in cell phones. So it should be better at supporting multimedia features. The technology is also “scalable,” which means handset designers can scale the flash memory they order depending on how complex they want their phones to be.
Industry analysts and investors are not so sure about all this. In a recent note on Spansion, Deutsche Bank Securities Ben Lynch wonders whether MirrorBit ORNAND will be a success. He notes that the new approach is only now being tested by customers with no real public feedback to date. Many investors seem to share the uncertainty. Spansion was spun out in December, but to get the deal done banks had to lower the offer price, says Lynch.
Buoyant insiders
Insiders, in contrast, are fully confident. “We had to invest a ton of money without having instant gratification,” chief executive Bertrand Cambou told me in a recent interview. In short, he says, the company has been in research and development mode, with little revenue to show for it. But all that is about to change, he believes. “Now we are at a position where we are ready to blossom and explode as a powerhouse in this space,” says Cambou.
The cynic’s view, of course, is that chief executives are always bullish on their business. But Cambou is a bull who puts his money where his mouth is, and that’s exactly what we look for here at Insiders Corner.
Shortly after his company came public, he purchased $653,000 worth of the stock at around $13. A director also made a big purchase at about $15.60 recently, rounding out the total insider buying so far to $1 million. That’s a good signal.
Of course, not every cell phone user is going to want to put a media center in his pocket. But many will. How many? A cell phone market strategy consultant called iGillottResearch estimates that in four years, one in six handsets will have processors, memory and operating systems with computing capabilities similar to those found in laptops.
But even lesser phones can use Spansion’s technology – and growth in the sector should remain robust, predicts iGillottResearch. The firm estimates that 1.2 billion handsets will be sold in 2010, compared to 808 million last year. Spansion memory will also be used in automobiles, smart cards, and other devices beyond cell phones.
The bottom line: The best time to own a tech company is right in front of a new product cycle – especially one linked to a hot market – before everyone else catches on. That’s what you have with Spansion and its memory product for cell phones turning into media centers. Of course, you never know if a new technology will really be a hit. But when insiders step up and place big bets with their own money, it’s a powerful sign. I’d buy right hear near $15 per share. But with so much volatility in the chip sector of late, and the natural volatility of recent offerings, you might be able to get the stock lower, too.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Thursday, February 23, 2006
Thursday, February 16, 2006
Reloading the Insider Matrix
As any investor can tell you, the purpose of a stop loss order is to set an automatic trigger that gets you out of a stock without emotional drama when it starts to sink – so your losses don’t multiply.
It’s simply too easy to trick yourself into staying with a losing position that chips away at your balance daily – as you cling to hope.
That’s why, as a rule, we dump positions in the Insiders Corner portfolio whenever they decline 25%. No questions asked. So it hardly makes sense to circle back now and reopen positions that have stopped out.
But I am going to do it anyway with two stocks that tanked in the past few months and stopped out: Peregrine Pharmaceuticals (PPHM) and Fossil (FOSL), a retailer.
Peregrine Pharmaceuticals
We suggested Peregrine last summer at around $1.25 (click here). But then the stock drifted steadily lower to around 90 cents a share, stopping out of our model portfolio.
The stock recently snapped back to life and surged to about $1.50, apparently on exactly the kind of news flow we were expecting. This suggests more upside -- because it’s easy to map out similar catalysts this year. Besides, the potential for this company’s main compound in fighting many common viruses and cancers is huge.
Peregrine’s a novel compound seems to work like this. Essentially, when cells in our bodies get infected or altered by viruses and cancers, they change in the following way. As cells get stressed by these ailments, they get confused about some of their maintenance tasks. One result is that phospholipids normally found on the inside of cell membranes wind up on the outside.
This has two key implications. When viruses leave the cells they’ve infected, bits of the membranes from those cells envelope those virus particles. The exposed phospholipids on those membranes serve as targets for Tarvacin, Peregrine’s lead compound.
It’s similar with cancers. Stressed by cancer, the cells in blood vessels feeding cancer cells also get confused about their maintenance tasks. So the internal phospholipids end up on the outside of the cells. Bingo, another target for Tarvacin.
Tarvacin works essentially by attaching to problem cells and suppressing the signals from them that throw off our immune system. This way, our immune system can key in on the problem cells and destroy them. “Tarvacin reprograms the body’s own natural defenses to recognize and fight disease,” says Peregrine chief executive Steven King.
Tarvacin could work against a broad range of viruses, including the ones that cause influenza and Hepatitis B and C, herpes, West Nile, Dengue, HIV, SARS, avian flu and many of the potential bio-terror “hemorrhagic” viruses, like Ebola. Early studies in animals also show that Tarvacin acts as a kind of vaccine against further infections of the virus it was originally used to treat.
Tarvacin may also work against several kinds of cancer, so the potential is huge here, too. Blockbuster anti-cancer therapies like Avastin and Rituxan from Genentech (DNA) produce billions of dollars a year in revenue, and Tarvacin could be in this league.
Peregrine also has a compound it is testing for brain cancer, called Cotara. It seems to work by gathering in dead cells inside tumors and serving as a kind of magnet and anchor for radiation treatments that fix to the Cotara, destroying tumors from the inside out.
Peregrine jumped to $1.50 per share from about 90 cents in early January, apparently on news that:
For the rest of the year, several clinical milestones may draw further interest in this company. They include:
This is a long-term buy and hold that requires patience because all of these therapies are still far from commercialization. But the potential is big, so it makes sense to tuck away some of this stock in your portfolio.
Fossil
Teen retailer Fossil is still not doing press interviews, so it’s harder to get a grip on out what might turn it around. Normally that kind of reticence is a big red flag.
But the insider whose multi-million dollar purchases originally put us in this stock (click here) is buying huge amounts in the recent pull back. The buying is so big I’ll reload this position, too, in a kind of blind faith that managers will get this retailer back on track.
Why have this kind of blind faith in investing? Because typically, management teams who once figured out how to design hot retail products for teens can figure out how to do it again after a cold spell. Just look at the ups and downs of retailers like Abercrombie & Fitch (ANF) and American Eagle Outfitters (AEOS) over the years.
The recent buying came when chief executive Kosta Kartsotis stepped up and purchased $2.4 million worth of the stock in the $17.60 to $18.30 range after the shares dropped about 25% following a February 2 earnings warning.
The bottom line: Biotech companies and teen retailers are notoriously risky. Even when insiders buy huge amounts, it’s no guarantee the stocks will go up. But Peregrine has products that may be in the same league as the ones that rewarded Genentech shareholders nicely and the Fossil chief executive is plowing so much money into his stock at these levels, both are worth a shot as long-term plays.
Disclaimer
At the time of publication, Michael Brush owned shares of Peregrine Pharmaceuticals. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
It’s simply too easy to trick yourself into staying with a losing position that chips away at your balance daily – as you cling to hope.
That’s why, as a rule, we dump positions in the Insiders Corner portfolio whenever they decline 25%. No questions asked. So it hardly makes sense to circle back now and reopen positions that have stopped out.
But I am going to do it anyway with two stocks that tanked in the past few months and stopped out: Peregrine Pharmaceuticals (PPHM) and Fossil (FOSL), a retailer.
Peregrine Pharmaceuticals
We suggested Peregrine last summer at around $1.25 (click here). But then the stock drifted steadily lower to around 90 cents a share, stopping out of our model portfolio.
The stock recently snapped back to life and surged to about $1.50, apparently on exactly the kind of news flow we were expecting. This suggests more upside -- because it’s easy to map out similar catalysts this year. Besides, the potential for this company’s main compound in fighting many common viruses and cancers is huge.
Peregrine’s a novel compound seems to work like this. Essentially, when cells in our bodies get infected or altered by viruses and cancers, they change in the following way. As cells get stressed by these ailments, they get confused about some of their maintenance tasks. One result is that phospholipids normally found on the inside of cell membranes wind up on the outside.
This has two key implications. When viruses leave the cells they’ve infected, bits of the membranes from those cells envelope those virus particles. The exposed phospholipids on those membranes serve as targets for Tarvacin, Peregrine’s lead compound.
It’s similar with cancers. Stressed by cancer, the cells in blood vessels feeding cancer cells also get confused about their maintenance tasks. So the internal phospholipids end up on the outside of the cells. Bingo, another target for Tarvacin.
Tarvacin works essentially by attaching to problem cells and suppressing the signals from them that throw off our immune system. This way, our immune system can key in on the problem cells and destroy them. “Tarvacin reprograms the body’s own natural defenses to recognize and fight disease,” says Peregrine chief executive Steven King.
Tarvacin could work against a broad range of viruses, including the ones that cause influenza and Hepatitis B and C, herpes, West Nile, Dengue, HIV, SARS, avian flu and many of the potential bio-terror “hemorrhagic” viruses, like Ebola. Early studies in animals also show that Tarvacin acts as a kind of vaccine against further infections of the virus it was originally used to treat.
Tarvacin may also work against several kinds of cancer, so the potential is huge here, too. Blockbuster anti-cancer therapies like Avastin and Rituxan from Genentech (DNA) produce billions of dollars a year in revenue, and Tarvacin could be in this league.
Peregrine also has a compound it is testing for brain cancer, called Cotara. It seems to work by gathering in dead cells inside tumors and serving as a kind of magnet and anchor for radiation treatments that fix to the Cotara, destroying tumors from the inside out.
Peregrine jumped to $1.50 per share from about 90 cents in early January, apparently on news that:
* Tarvacin controlled the spread of pancreatic cancer in mice
* Peregrine enrolled patients months ahead of schedule in a study on how Tarvacin works against Hepatitis C
* the Defense Department announced a grant to support research on how well Tarvacin works against prostate cancer.
For the rest of the year, several clinical milestones may draw further interest in this company. They include:
* advances in its study on how well Tarvacin works against Hepatitis C
* completion of enrollment in studies on how well Tarvacin and Cotara work against cancer
* an expansion in the list of viruses that Tarvacin may work against
This is a long-term buy and hold that requires patience because all of these therapies are still far from commercialization. But the potential is big, so it makes sense to tuck away some of this stock in your portfolio.
Fossil
Teen retailer Fossil is still not doing press interviews, so it’s harder to get a grip on out what might turn it around. Normally that kind of reticence is a big red flag.
But the insider whose multi-million dollar purchases originally put us in this stock (click here) is buying huge amounts in the recent pull back. The buying is so big I’ll reload this position, too, in a kind of blind faith that managers will get this retailer back on track.
Why have this kind of blind faith in investing? Because typically, management teams who once figured out how to design hot retail products for teens can figure out how to do it again after a cold spell. Just look at the ups and downs of retailers like Abercrombie & Fitch (ANF) and American Eagle Outfitters (AEOS) over the years.
The recent buying came when chief executive Kosta Kartsotis stepped up and purchased $2.4 million worth of the stock in the $17.60 to $18.30 range after the shares dropped about 25% following a February 2 earnings warning.
The bottom line: Biotech companies and teen retailers are notoriously risky. Even when insiders buy huge amounts, it’s no guarantee the stocks will go up. But Peregrine has products that may be in the same league as the ones that rewarded Genentech shareholders nicely and the Fossil chief executive is plowing so much money into his stock at these levels, both are worth a shot as long-term plays.
Disclaimer
At the time of publication, Michael Brush owned shares of Peregrine Pharmaceuticals. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Thursday, February 09, 2006
Snipping Genes to Cure Diseases
When U.S. President George Bush asked Congress to write laws that would ban “human-animal” hybrids last week in his State of the Union speech, it was a chilling reminder of the more bizarre implications of the genetic research going on around us.
So it’s comforting to remember that the miracles of genetic modification are also being tapped to protect human life and treat diseases.
A good example of these efforts is a Cambridge, Mass.-based company called Alnylam Pharmaceuticals (ALNY), where a director recently bought a big slug of stock, worth $1.3 million.
Running interference
Alnylam – named after a star in the constellation Orion – works in an area of science called “RNA interference.”
You may remember from biology classes that RNA, or ribonucleic acid, is a chemical that plays a role in the creation of proteins inside cells. Since most ailments can be traced back to the production of proteins, knowing how to stop RNA from making proteins means you have the keys to preventing all kinds of diseases.
This technique is called RNA interference, or RNAi for short, and it’s the main focus at Alnylam. “What we can do with our RNAi technology is stop those diseased proteins from being made in the first place,” says Alnylam chief executive John Maraganore.
RNAi works by slicing certain genes in our bodies, to disable RNA from producing specific proteins. It can also be used to attack viruses by disabling the genes inside of them that help the viruses reproduce.
If RNAi therapies ever see the light of day, patients will likely take them via regular injections, or inhalers.
Embarrassment of riches
Since proteins are at the root of most diseases and even problems like chronic pain, the potential here is huge. “There could be a whole new class of drugs based on RNAi,” says Maraganore. “We have an embarrassment of riches in the different diseases we can tackle.”
Here’s a brief look at some of the main ones Alnylam is working on first.
* Bird Flu
No one knows whether the H5N1 avian flu virus will ever make the jump to humans in a way that causes widespread problems (http://moneycentral.msn.com/content/P132582.asp). But it might. That would be devastating for us. But it could light a fire under Alnylam stock. That’s because the company believes its RNAi can neutralize the bird flu virus. Alnylam hopes to file an investigational new drug (IND) application with the Food and Drug Administration as early as the second half of this year in this area.
* Respiratory Syncytial Virus (RSV)
RSV is the leading cause of lower respiratory infections in infants. There are millions of cases in the US each year. Alnylam recently started enrolling patients for Phase I trials of a potential RSV therapy, to test for safety and dosage levels. It could release results in the first half of this year. The therapy could work by delivering a drug to the lung to neutralize a gene in the virus, preventing it from reproducing.
* Neurological diseases
Since ailments like Parkinson’s disease, Alzheimer's disease and cystic fibrosis can all be traced back to the production of certain kinds of proteins inside cells, RNAi might work against these problems, too. Alnylam is also in the early stages of trying to apply the technology to help regenerate nerves damaged in spinal cord injuries or stop certain kinds of pain.
Success factors
So many biotech companies sound so promising when you talk with the scientists, it’s hard to single a few out to invest in. I think Alnylam makes the cut for three reasons.
First, Alnylam has three key partnerships that suggest big drug companies believe in their tech. The partnerships are with Merck (MRK), Medtronic (MDT), and Novartis AG (NVS). These alliances have brought in about $100 million for Alnylam. Novartis owns just under 20% of the stock.
Next, Alnylam has some of the key scientists in the space on its team. They include: Thomas Tuschl who is the head of the Laboratory of RNA Molecular Biology at Rockefeller University, and Phillip Sharp who is the director of the McGovern Institute for Brain Research at the Massachusetts Institute of Technology. The company may ultimately lay claim to much of the intellectual property and patent rights behind RNAi.
Third, Paul Schimmel, a director, bought $1.3 million worth of the stock at the end of January. Insiders are often wrong in biotech, but that’s a significant bet.
The bottom line: Many biotech companies with a lot promise flame out. And this is a company that lost 51 cents a share in its last reported quarter. In short, it has a long way to go to profitability. But it’s got the stamp of approval of some major pharma companies. And several catalysts this year could move the stock. They include: the completion of Phase I studies on the RSV drug and the launch of Phase II trials here; the release of data from primate research on other therapies; and more funding for bird flu work and possible regulatory advances here. If you buy, just remember that early stage biotech companies are most suitable for investors with a long-term view.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
So it’s comforting to remember that the miracles of genetic modification are also being tapped to protect human life and treat diseases.
A good example of these efforts is a Cambridge, Mass.-based company called Alnylam Pharmaceuticals (ALNY), where a director recently bought a big slug of stock, worth $1.3 million.
Running interference
Alnylam – named after a star in the constellation Orion – works in an area of science called “RNA interference.”
You may remember from biology classes that RNA, or ribonucleic acid, is a chemical that plays a role in the creation of proteins inside cells. Since most ailments can be traced back to the production of proteins, knowing how to stop RNA from making proteins means you have the keys to preventing all kinds of diseases.
This technique is called RNA interference, or RNAi for short, and it’s the main focus at Alnylam. “What we can do with our RNAi technology is stop those diseased proteins from being made in the first place,” says Alnylam chief executive John Maraganore.
RNAi works by slicing certain genes in our bodies, to disable RNA from producing specific proteins. It can also be used to attack viruses by disabling the genes inside of them that help the viruses reproduce.
If RNAi therapies ever see the light of day, patients will likely take them via regular injections, or inhalers.
Embarrassment of riches
Since proteins are at the root of most diseases and even problems like chronic pain, the potential here is huge. “There could be a whole new class of drugs based on RNAi,” says Maraganore. “We have an embarrassment of riches in the different diseases we can tackle.”
Here’s a brief look at some of the main ones Alnylam is working on first.
* Bird Flu
No one knows whether the H5N1 avian flu virus will ever make the jump to humans in a way that causes widespread problems (http://moneycentral.msn.com/content/P132582.asp). But it might. That would be devastating for us. But it could light a fire under Alnylam stock. That’s because the company believes its RNAi can neutralize the bird flu virus. Alnylam hopes to file an investigational new drug (IND) application with the Food and Drug Administration as early as the second half of this year in this area.
* Respiratory Syncytial Virus (RSV)
RSV is the leading cause of lower respiratory infections in infants. There are millions of cases in the US each year. Alnylam recently started enrolling patients for Phase I trials of a potential RSV therapy, to test for safety and dosage levels. It could release results in the first half of this year. The therapy could work by delivering a drug to the lung to neutralize a gene in the virus, preventing it from reproducing.
* Neurological diseases
Since ailments like Parkinson’s disease, Alzheimer's disease and cystic fibrosis can all be traced back to the production of certain kinds of proteins inside cells, RNAi might work against these problems, too. Alnylam is also in the early stages of trying to apply the technology to help regenerate nerves damaged in spinal cord injuries or stop certain kinds of pain.
Success factors
So many biotech companies sound so promising when you talk with the scientists, it’s hard to single a few out to invest in. I think Alnylam makes the cut for three reasons.
First, Alnylam has three key partnerships that suggest big drug companies believe in their tech. The partnerships are with Merck (MRK), Medtronic (MDT), and Novartis AG (NVS). These alliances have brought in about $100 million for Alnylam. Novartis owns just under 20% of the stock.
Next, Alnylam has some of the key scientists in the space on its team. They include: Thomas Tuschl who is the head of the Laboratory of RNA Molecular Biology at Rockefeller University, and Phillip Sharp who is the director of the McGovern Institute for Brain Research at the Massachusetts Institute of Technology. The company may ultimately lay claim to much of the intellectual property and patent rights behind RNAi.
Third, Paul Schimmel, a director, bought $1.3 million worth of the stock at the end of January. Insiders are often wrong in biotech, but that’s a significant bet.
The bottom line: Many biotech companies with a lot promise flame out. And this is a company that lost 51 cents a share in its last reported quarter. In short, it has a long way to go to profitability. But it’s got the stamp of approval of some major pharma companies. And several catalysts this year could move the stock. They include: the completion of Phase I studies on the RSV drug and the launch of Phase II trials here; the release of data from primate research on other therapies; and more funding for bird flu work and possible regulatory advances here. If you buy, just remember that early stage biotech companies are most suitable for investors with a long-term view.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Thursday, February 02, 2006
Get a Piece of Every Transaction with This Fast-Growing Credit Card Processor
It’s every dreamer’s get-rich-slow scheme. Figure out a way to take a small piece of lots of transactions that happen daily. Then sit back on the beach and let the money roll in.
I’m not sure how much time CAM Commerce Solutions (CADA) chief executive Geoffrey Knapp spends on the beach. But he seems to have figured out the first half of the equation.
His company spent years after starting up in the 1980s selling payment processing systems to retailers. That end of the business has been hit or miss lately.
But another side of the business is hot. It’s a software system retailers can incorporate into their payment systems that helps them in two ways. First, it allows them to get rid of that separate box you use to swipe your credit card. Instead, your card gets read by the store’s register.
Second, there’s now only one transaction – the register both reads your card and rings up your purchase in one shot. This means at the end of the day retailers don’t have to audit records of sales through two systems to be sure they all match up.
“With ours it is all one system,” says Knapp. “You eliminate all that extra equipment and all the auditing each day.” CAM Commerce takes a small piece of each transaction, sharing it sometimes with other vendors of payment systems if they were the ones who installed systems using CAM Commerce’s software.
Snapping it up
This might be a little more than you care to know about retail payment systems. But retailers themselves are snapping up X-Charge, as the system is called. In the September-ending quarter, X-Charge sales grew 78%.
CAM Commerce has other lines of business – like complete payment processing systems – so overall revenue isn’t moving up that fast. But the good news is that margins are higher on the X-Charge revenue, so as it grows, earnings move up a lot.
How much?
B. Riley & Co. analyst Justin Cable doesn’t cover the company. But he follows the sector so he has a model for CAM Commerce. He’s looking for overall revenue growth of 9.7% this year and 13.4% next year.
But because revenue should grow faster than costs, earnings per share could grow 75% this year and 57% next year. That means pro forma earnings per share could be 77 cents this year and $1.21 next year, compared to 44 cents last year. The company also has a forward annual dividend of 56 cents a share, for a dividend yield of 2.4%.
Despite this kind of prospective growth, CAM Commerce looks moderately cheap. If you strip out the company’s $5.47 per share in cash, the company trades for about 2.7 times sales, at $23.50 per share. Sage, a big UK software company, recently paid 5.1 times sales for Nashville, TN-based payment processor Verus Financial Management.
Insiders have purchased $2.6 million worth of stock since last April, and this is only a $65 million market cap company. So that’s huge.
About $2.1 million came from a beneficial owner (someone who owns more than 10% of the stock) who has close contacts with top management. Knapp has purchased $442,000 worth and now owns over 12% of the shares.
The bottom line: Insiders admittedly bought the stock much lower. Knapp’s highest purchase was at $17.50 and the beneficial owner purchased most of his stock under $15, but his highest purchase was $22.80. In short, the stock has been strong of late – probably in anticipation of good earnings news on Feb. 14 when CAM Commerce reports – so we are a little late to the story. But there is still probably significant upside ahead, and I’d expect the stock to be strong on quarterly earnings news. So I would buy right now.
I’m not sure how much time CAM Commerce Solutions (CADA) chief executive Geoffrey Knapp spends on the beach. But he seems to have figured out the first half of the equation.
His company spent years after starting up in the 1980s selling payment processing systems to retailers. That end of the business has been hit or miss lately.
But another side of the business is hot. It’s a software system retailers can incorporate into their payment systems that helps them in two ways. First, it allows them to get rid of that separate box you use to swipe your credit card. Instead, your card gets read by the store’s register.
Second, there’s now only one transaction – the register both reads your card and rings up your purchase in one shot. This means at the end of the day retailers don’t have to audit records of sales through two systems to be sure they all match up.
“With ours it is all one system,” says Knapp. “You eliminate all that extra equipment and all the auditing each day.” CAM Commerce takes a small piece of each transaction, sharing it sometimes with other vendors of payment systems if they were the ones who installed systems using CAM Commerce’s software.
Snapping it up
This might be a little more than you care to know about retail payment systems. But retailers themselves are snapping up X-Charge, as the system is called. In the September-ending quarter, X-Charge sales grew 78%.
CAM Commerce has other lines of business – like complete payment processing systems – so overall revenue isn’t moving up that fast. But the good news is that margins are higher on the X-Charge revenue, so as it grows, earnings move up a lot.
How much?
B. Riley & Co. analyst Justin Cable doesn’t cover the company. But he follows the sector so he has a model for CAM Commerce. He’s looking for overall revenue growth of 9.7% this year and 13.4% next year.
But because revenue should grow faster than costs, earnings per share could grow 75% this year and 57% next year. That means pro forma earnings per share could be 77 cents this year and $1.21 next year, compared to 44 cents last year. The company also has a forward annual dividend of 56 cents a share, for a dividend yield of 2.4%.
Despite this kind of prospective growth, CAM Commerce looks moderately cheap. If you strip out the company’s $5.47 per share in cash, the company trades for about 2.7 times sales, at $23.50 per share. Sage, a big UK software company, recently paid 5.1 times sales for Nashville, TN-based payment processor Verus Financial Management.
Insiders have purchased $2.6 million worth of stock since last April, and this is only a $65 million market cap company. So that’s huge.
About $2.1 million came from a beneficial owner (someone who owns more than 10% of the stock) who has close contacts with top management. Knapp has purchased $442,000 worth and now owns over 12% of the shares.
The bottom line: Insiders admittedly bought the stock much lower. Knapp’s highest purchase was at $17.50 and the beneficial owner purchased most of his stock under $15, but his highest purchase was $22.80. In short, the stock has been strong of late – probably in anticipation of good earnings news on Feb. 14 when CAM Commerce reports – so we are a little late to the story. But there is still probably significant upside ahead, and I’d expect the stock to be strong on quarterly earnings news. So I would buy right now.
Thursday, January 26, 2006
A Tiny Way to Play Something Huge: The Nanotech Promise
Few “new” technologies have stirred as much controversy as nanotechnology – the science of how to exploit behavioral quirks that develop in materials when you smash them up into really tiny particles.
Coming onto the investment scene as a theme a few years ago (http://moneycentral.msn.com/content/P63642.asp), nanotechnology holds the promise of breakthroughs like powerful mini-computers, new families of drugs and diagnostic tools that can detect diseases early on, say proponents.
Detractors claim much of nanotech is plain old fraud – or at best nothing more than the latest trendy investment rubric that unscrupulous managers try to fit their companies into, as a way to generate buzz and attract funding.
A fraud?
Few critics have been as vocal as short-seller Manuel Asensio who has maintained a scathing campaign against at least one company seeking the nanotech mantel, NVE (NVEC). It should be no surprise, of course, that Asensio has had a short position in the stock – or a kind of bet that the stock will go down.
“NVEC still hunting for illiterate investors,” was the headline on a December missive from Asensio maintaining that NVE recently announced it had been awarded a research grant but failed to mention in the press release that it was for the minimal amount of $190,000. Other Asensio assaults have carried biting headlines like “Is NVEC a fraud?”
Since I started following Asensio’s attacks on NVE in late 2004, the company’s stock has declined over 50% to trade recently for around $16. The sharp decline underscores how easy it is to lose a lot of money investing in a single play billed as an easy ride on a hot technology.
In other words, investors really face two problems when looking for a way to play nanotech. First, they’d be dumb to ignore it, because many people will ultimately find ways to make a lot of money with nanotech. Second, however, there are no nanotech mutual funds. And buying a basket of these companies on your own can tie up a big part of your capital.
A small way to something big
Fortunately, insiders have recently been showing the way to an alternative that takes care of both these problems. Around the end of December, there was a small flurry of insider buying at a company called Harris & Harris Group (TINY).
Based in New York, Harris & Harris is a sort of venture capital fund that puts money into small, private companies that are working on nanotech breakthroughs. By following the insiders and buying shares of Harris & Harris, you’d be getting a diversified portfolio of potential winners in the nanotech field. To be sure, the Harris & Harris insider buying has been relatively light – only $111,000 since last summer.
But Harris & Harris still looks promising. In the past two weeks alone, it has:
* Invested in the Durham, North Carolina-based Metabolon, a company that is working on discovering biomarkers and measuring biochemical changes and how they affect metabolic pathways as a way to diagnose diseases early.
* Upped its investment in a company called Chlorogen which uses a technology that alters tobacco plants in a way that coverts them into little “factories” producing proteins that may one day treat gynecological cancers.
* Upped its investment in NanoGram, a San Jose, CA, company working on the application of nanotechnology in optical, electronic, and energy products.
These are among more than two dozen investments that Harris & Harris has going in the nanotech field.
Some concrete catalysts ahead?
If all this seems too esoteric, WR Hambrecht + Co. analyst John Roy identifies two more concrete near-term catalysts that could move the stock.
First, there’s a nanotech investing conference that will run from January 30 to February 2. News and presentations could move Harris & Harris shares.
Second, Roy expects a few nanotech initial public offerings soon. If successful, they would shine a spotlight on Harris & Harris – since it has investments in companies that may one day go public, too.
“While the next nanotechnology IPOs may not be in Harris & Harris' portfolio, successful nanotech IPOs will likely reflect well on the company,” believes Roy.
A wee bit of caution
To me, this is the kind of investment you put just a little money into for the long-term – meaning several years. Despite his enthusiasm for the stock, for example, Roy only has a $17 price target on it. The stock recently traded for $14.80 suggesting limited upside – though stocks in hot sectors are known to blow through analysts’ price targets fast.
What’s more, in a recent letter to shareholders, Harris & Harris said it may need to invest $200 million to $700 million over the next five years to keep on top of the field. That’s a lot of money for a company with limited revenue. So it may need to do a dilutive financing.
The bottom line: Some major breakthroughs are going to come out of this science of the small. But they could be a long time in coming. I’d only put a nano-slice of my investment portfolio into this stock as a way to play the developments.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Coming onto the investment scene as a theme a few years ago (http://moneycentral.msn.com/content/P63642.asp), nanotechnology holds the promise of breakthroughs like powerful mini-computers, new families of drugs and diagnostic tools that can detect diseases early on, say proponents.
Detractors claim much of nanotech is plain old fraud – or at best nothing more than the latest trendy investment rubric that unscrupulous managers try to fit their companies into, as a way to generate buzz and attract funding.
A fraud?
Few critics have been as vocal as short-seller Manuel Asensio who has maintained a scathing campaign against at least one company seeking the nanotech mantel, NVE (NVEC). It should be no surprise, of course, that Asensio has had a short position in the stock – or a kind of bet that the stock will go down.
“NVEC still hunting for illiterate investors,” was the headline on a December missive from Asensio maintaining that NVE recently announced it had been awarded a research grant but failed to mention in the press release that it was for the minimal amount of $190,000. Other Asensio assaults have carried biting headlines like “Is NVEC a fraud?”
Since I started following Asensio’s attacks on NVE in late 2004, the company’s stock has declined over 50% to trade recently for around $16. The sharp decline underscores how easy it is to lose a lot of money investing in a single play billed as an easy ride on a hot technology.
In other words, investors really face two problems when looking for a way to play nanotech. First, they’d be dumb to ignore it, because many people will ultimately find ways to make a lot of money with nanotech. Second, however, there are no nanotech mutual funds. And buying a basket of these companies on your own can tie up a big part of your capital.
A small way to something big
Fortunately, insiders have recently been showing the way to an alternative that takes care of both these problems. Around the end of December, there was a small flurry of insider buying at a company called Harris & Harris Group (TINY).
Based in New York, Harris & Harris is a sort of venture capital fund that puts money into small, private companies that are working on nanotech breakthroughs. By following the insiders and buying shares of Harris & Harris, you’d be getting a diversified portfolio of potential winners in the nanotech field. To be sure, the Harris & Harris insider buying has been relatively light – only $111,000 since last summer.
But Harris & Harris still looks promising. In the past two weeks alone, it has:
* Invested in the Durham, North Carolina-based Metabolon, a company that is working on discovering biomarkers and measuring biochemical changes and how they affect metabolic pathways as a way to diagnose diseases early.
* Upped its investment in a company called Chlorogen which uses a technology that alters tobacco plants in a way that coverts them into little “factories” producing proteins that may one day treat gynecological cancers.
* Upped its investment in NanoGram, a San Jose, CA, company working on the application of nanotechnology in optical, electronic, and energy products.
These are among more than two dozen investments that Harris & Harris has going in the nanotech field.
Some concrete catalysts ahead?
If all this seems too esoteric, WR Hambrecht + Co. analyst John Roy identifies two more concrete near-term catalysts that could move the stock.
First, there’s a nanotech investing conference that will run from January 30 to February 2. News and presentations could move Harris & Harris shares.
Second, Roy expects a few nanotech initial public offerings soon. If successful, they would shine a spotlight on Harris & Harris – since it has investments in companies that may one day go public, too.
“While the next nanotechnology IPOs may not be in Harris & Harris' portfolio, successful nanotech IPOs will likely reflect well on the company,” believes Roy.
A wee bit of caution
To me, this is the kind of investment you put just a little money into for the long-term – meaning several years. Despite his enthusiasm for the stock, for example, Roy only has a $17 price target on it. The stock recently traded for $14.80 suggesting limited upside – though stocks in hot sectors are known to blow through analysts’ price targets fast.
What’s more, in a recent letter to shareholders, Harris & Harris said it may need to invest $200 million to $700 million over the next five years to keep on top of the field. That’s a lot of money for a company with limited revenue. So it may need to do a dilutive financing.
The bottom line: Some major breakthroughs are going to come out of this science of the small. But they could be a long time in coming. I’d only put a nano-slice of my investment portfolio into this stock as a way to play the developments.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Wednesday, January 18, 2006
Make Your Day with this Insider Signal on Steroids
In a highly unusual twist for an insider, the top dog at a teen retailer called Fossil (FOSL) recently signed up for a kind of pre-approved automatic trading program that allows executives to act even when they have insider information.
What’s odd about the move at Fossil is that the program is almost always used by insiders to sell stock like a robot no matter what – whether they know bad news is just around the corner or not.
In the case of Fossil, however, chief executive Kosta Kartsotis has signed up for the plan to buy his company’s stock. So far, Kartsotis has wasted little time snapping up a huge piece of Fossil stock.
Since December 16 he has purchased $5.5 million worth of stock in the $20 to $22.11 range, according to Thomson Financial. That alone would be a solid signal at a small company like this. Mix in the pre-programmed buying plan, and I’d call this an insider buy signal on steroids.
Fossil
What is Fossil and why might its shares continue higher? The company is probably best known for its watches. But Fossil also offers lines of leather goods, belts, handbags and apparel.
Wall Street analysts are generally gloomy about the company – but that’s actually good when insiders are so bullish. It means more people are on the sidelines waiting for the analyst cue to buy shares – and drive your shares higher if you own. Analysts worry about a big contraction in watch sales in the all-important U.S. market, high inventories, and lowered guidance for the last quarter.
Plus Fossil has committed the cardinal sin of retail. It did so well a year ago that now it faces tough “comps,” making today’s slowdown look even worse by comparison. But guess what. Once a retailer cycles through a year of missing challenging comps, it’s up against weaker comps once again. Voila -- suddenly the pressure is off and it can look good, even if business hasn’t returned to old levels.
But Fossil has other things going for it other than this distorted piece of psychology among retail investors. And as always I’ll take the insider signal over what the Wall Street analysts say, any day. Here’s what may bring Fossil up out of the bed rock of the Wall Street avoid list.
* Sure, U.S. watch sales were weak. But international sales – which make up about 44% of sales – were solid in the most recent quarter. They rose 12.7%. European sales increased 21%. Plus accessory sales in the U.S. were strong, with sales up 21% in handbags, women’s belts, small leather goods and sunglasses. This tells me that Fossil hasn’t lost its touch – and a recent shakeup of design teams in Dallas and Hong Kong might be what it takes to reinvigorate areas where Fossil is weak.
* Fossil is also rolling out new brands like Adidas. It’s planning to expand its luxury “Michelle” brand of watches into a lifestyle brand including jewelry and handbags. Fossil’s Zodiac brand is gaining momentum in Europe and the U.S.
* The company is also moving forward on a partnership with Wal-Mart, after a successful test phase.
The tricky thing about retail is that you always have to be one step ahead of the market – creating styles that people will like at some point in the future even if you have no clue whether they will work as you place the orders for next season.
But given the chief executive’s pre-programmed buying plan and the huge $5.5 million worth of stock he has purchased so far, I’d say there’s an internal confidence level at Fossil that’s compelling.
The bottom line: What’s more, the board itself just authorized a new 3.5 million share repurchase plan, while the company has about 700,000 shares left on the old one. With retail, the insider signal can lead you astray, as we found with Gander Mountain (GMTN) which stopped out with a 20% loss. But this one is so strong I’d buy shares right here.
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
What’s odd about the move at Fossil is that the program is almost always used by insiders to sell stock like a robot no matter what – whether they know bad news is just around the corner or not.
In the case of Fossil, however, chief executive Kosta Kartsotis has signed up for the plan to buy his company’s stock. So far, Kartsotis has wasted little time snapping up a huge piece of Fossil stock.
Since December 16 he has purchased $5.5 million worth of stock in the $20 to $22.11 range, according to Thomson Financial. That alone would be a solid signal at a small company like this. Mix in the pre-programmed buying plan, and I’d call this an insider buy signal on steroids.
Fossil
What is Fossil and why might its shares continue higher? The company is probably best known for its watches. But Fossil also offers lines of leather goods, belts, handbags and apparel.
Wall Street analysts are generally gloomy about the company – but that’s actually good when insiders are so bullish. It means more people are on the sidelines waiting for the analyst cue to buy shares – and drive your shares higher if you own. Analysts worry about a big contraction in watch sales in the all-important U.S. market, high inventories, and lowered guidance for the last quarter.
Plus Fossil has committed the cardinal sin of retail. It did so well a year ago that now it faces tough “comps,” making today’s slowdown look even worse by comparison. But guess what. Once a retailer cycles through a year of missing challenging comps, it’s up against weaker comps once again. Voila -- suddenly the pressure is off and it can look good, even if business hasn’t returned to old levels.
But Fossil has other things going for it other than this distorted piece of psychology among retail investors. And as always I’ll take the insider signal over what the Wall Street analysts say, any day. Here’s what may bring Fossil up out of the bed rock of the Wall Street avoid list.
* Sure, U.S. watch sales were weak. But international sales – which make up about 44% of sales – were solid in the most recent quarter. They rose 12.7%. European sales increased 21%. Plus accessory sales in the U.S. were strong, with sales up 21% in handbags, women’s belts, small leather goods and sunglasses. This tells me that Fossil hasn’t lost its touch – and a recent shakeup of design teams in Dallas and Hong Kong might be what it takes to reinvigorate areas where Fossil is weak.
* Fossil is also rolling out new brands like Adidas. It’s planning to expand its luxury “Michelle” brand of watches into a lifestyle brand including jewelry and handbags. Fossil’s Zodiac brand is gaining momentum in Europe and the U.S.
* The company is also moving forward on a partnership with Wal-Mart, after a successful test phase.
The tricky thing about retail is that you always have to be one step ahead of the market – creating styles that people will like at some point in the future even if you have no clue whether they will work as you place the orders for next season.
But given the chief executive’s pre-programmed buying plan and the huge $5.5 million worth of stock he has purchased so far, I’d say there’s an internal confidence level at Fossil that’s compelling.
The bottom line: What’s more, the board itself just authorized a new 3.5 million share repurchase plan, while the company has about 700,000 shares left on the old one. With retail, the insider signal can lead you astray, as we found with Gander Mountain (GMTN) which stopped out with a 20% loss. But this one is so strong I’d buy shares right here.
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Wednesday, January 11, 2006
Look for Profits in This “Everyman’s IPO”
By Michael Brush
January 12, 2006
One of the most common questions I get as a market columnist is: “How can I participate in initial public offerings (IPO)?”
The allure of the IPO is understandable. Many IPO stocks grab headlines by rising dramatically right out of the gate (even if quite a few don’t work out so well).
Unfortunately, to join the IPO party you have to be a fairly high roller with a big brokerage account. Otherwise, you are out of luck.
There is one exception, and a solid pattern of insider purchasing points us to a promising example that looks like a solid buy right now.
The “Everyman’s IPO”
Here’s one way regular investors can break into the exclusive IPO club. Very small companies often come public by merging into shell companies that are already listed on an exchange. The beauty is that anyone can buy the shares of the shell company in advance – even without a big account at brokerage – to participate in this back door IPO. It’s a kind of “everyman’s IPO.”
This chain of events is about to play out next month at the Tampa, Florida-based CEA Acquisition Corp. (CEAC.OB) when a private biotech company called etrials Worldwide merges into CEA.
The result should be a publicly traded company that will likely be dramatically undervalued compared to a competitor. That – plus healthy growth -- should mean decent profits down the road for anyone who buys shares of CEA right now.
PDAs for guinea pigs
What does etrials Worldwide do? It sells software and electronic devices that human guinea pigs in drug trials use to keep track of things. Patients enter data into devices similar to personal digital assistants (PDAs), which transmit the information to labs.
Several giants of the pharmaceutical industry are etrials customers, including: Pfizer (PFE), Genzyme (GENZ) and Wyeth (WYE). The company’s equipment was used in the clinical studies on Viagra.
This electronic system of collecting data is faster, easier and more accurate than the traditional approach – patients using a pen and spiral notebook to keep diaries.
That’s why companies like etrials and DATATRAK International (DATA) – a public version of etrials – are growing so fast. And it looks like there is plenty of room for more growth. Right now, patients in about 75% of trials still use the spiral notebook approach. That should continue to fall. Meanwhile, the number of clinical trials is growing each year by about 15%.
Rapid growth
This helps explain why DATATRAK's revenue increased approximately 45% to $11.4 million for the first three quarters of 2005.
At etrials, revenue grew at between 50% and 72% a year for 2002 through 2004. These rates will slow down – since etrials has been growing off a small revenue base.
But investment bankers involved in the etrials deal – bankers who admittedly have a bias – use annual revenue growth projections of about 30% a year for the next four years, in their valuation models. If they are right, etrials revenue will grow to $45.6 million in 2009 from $15.8 million in 2005.
Undervalued shares
The way CEA shares are priced right now, at $5.40, it doesn’t look like the market sees what’s coming in the merger with etrials. Let’s walk through some numbers to see why.
DATATRAK trades for an enterprise value (market cap minus cash plus debt) of $86 million, or about 5.8 times its $14.8 million in sales.
But the new CEA, after etrials is folded in, looks like it will have an enterprise value of around $43 million, when all is said and done with the merger. That’s less than thee times sales, compared to the 5.8 at DATATRAK. And it’s half the enterprise value of DATATRACK, even though etrials has roughly the same amount of trailing revenue.
Good visibility
These companies also have solid backlogs. This isn’t surprising since clinical trials drag on for years. Still, the backlogs offer excellent revenue visibility. DATATRAK’s backlog of $17.4 million exceeds its trailing annual revenue of around $14 million. At etrials the difference is even greater. The company has about a $22 million backlog compared to about $15 million in revenue for last year.
The bottom line: It’s already a positive sign that CEA insiders – who already own a lot of stock – have purchased about $800,000 worth since mid-November, at prices near current levels, or $5.19 to $5.50. But insiders at CEA and etrials are also placing a simple and enticing bet which shows a lot of moxie. As part of the merger deal, they’ve agreed to put 1.4 million shares in an escrow account that will vanish unless the new CEA stock trades above $7 before February 2008. CEA should also get a boost right off the bat when it transfers to Nasdaq from the bulletin board later this year. I’d buy right here, while the market still hasn’t figure out all that’s about to happen.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
January 12, 2006
One of the most common questions I get as a market columnist is: “How can I participate in initial public offerings (IPO)?”
The allure of the IPO is understandable. Many IPO stocks grab headlines by rising dramatically right out of the gate (even if quite a few don’t work out so well).
Unfortunately, to join the IPO party you have to be a fairly high roller with a big brokerage account. Otherwise, you are out of luck.
There is one exception, and a solid pattern of insider purchasing points us to a promising example that looks like a solid buy right now.
The “Everyman’s IPO”
Here’s one way regular investors can break into the exclusive IPO club. Very small companies often come public by merging into shell companies that are already listed on an exchange. The beauty is that anyone can buy the shares of the shell company in advance – even without a big account at brokerage – to participate in this back door IPO. It’s a kind of “everyman’s IPO.”
This chain of events is about to play out next month at the Tampa, Florida-based CEA Acquisition Corp. (CEAC.OB) when a private biotech company called etrials Worldwide merges into CEA.
The result should be a publicly traded company that will likely be dramatically undervalued compared to a competitor. That – plus healthy growth -- should mean decent profits down the road for anyone who buys shares of CEA right now.
PDAs for guinea pigs
What does etrials Worldwide do? It sells software and electronic devices that human guinea pigs in drug trials use to keep track of things. Patients enter data into devices similar to personal digital assistants (PDAs), which transmit the information to labs.
Several giants of the pharmaceutical industry are etrials customers, including: Pfizer (PFE), Genzyme (GENZ) and Wyeth (WYE). The company’s equipment was used in the clinical studies on Viagra.
This electronic system of collecting data is faster, easier and more accurate than the traditional approach – patients using a pen and spiral notebook to keep diaries.
That’s why companies like etrials and DATATRAK International (DATA) – a public version of etrials – are growing so fast. And it looks like there is plenty of room for more growth. Right now, patients in about 75% of trials still use the spiral notebook approach. That should continue to fall. Meanwhile, the number of clinical trials is growing each year by about 15%.
Rapid growth
This helps explain why DATATRAK's revenue increased approximately 45% to $11.4 million for the first three quarters of 2005.
At etrials, revenue grew at between 50% and 72% a year for 2002 through 2004. These rates will slow down – since etrials has been growing off a small revenue base.
But investment bankers involved in the etrials deal – bankers who admittedly have a bias – use annual revenue growth projections of about 30% a year for the next four years, in their valuation models. If they are right, etrials revenue will grow to $45.6 million in 2009 from $15.8 million in 2005.
Undervalued shares
The way CEA shares are priced right now, at $5.40, it doesn’t look like the market sees what’s coming in the merger with etrials. Let’s walk through some numbers to see why.
DATATRAK trades for an enterprise value (market cap minus cash plus debt) of $86 million, or about 5.8 times its $14.8 million in sales.
But the new CEA, after etrials is folded in, looks like it will have an enterprise value of around $43 million, when all is said and done with the merger. That’s less than thee times sales, compared to the 5.8 at DATATRAK. And it’s half the enterprise value of DATATRACK, even though etrials has roughly the same amount of trailing revenue.
Good visibility
These companies also have solid backlogs. This isn’t surprising since clinical trials drag on for years. Still, the backlogs offer excellent revenue visibility. DATATRAK’s backlog of $17.4 million exceeds its trailing annual revenue of around $14 million. At etrials the difference is even greater. The company has about a $22 million backlog compared to about $15 million in revenue for last year.
The bottom line: It’s already a positive sign that CEA insiders – who already own a lot of stock – have purchased about $800,000 worth since mid-November, at prices near current levels, or $5.19 to $5.50. But insiders at CEA and etrials are also placing a simple and enticing bet which shows a lot of moxie. As part of the merger deal, they’ve agreed to put 1.4 million shares in an escrow account that will vanish unless the new CEA stock trades above $7 before February 2008. CEA should also get a boost right off the bat when it transfers to Nasdaq from the bulletin board later this year. I’d buy right here, while the market still hasn’t figure out all that’s about to happen.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Thursday, January 05, 2006
Globalize This!
By Michael Brush
January 05, 2006
Globalization is great if you like to buy -- or sell -- cheap goods.
But it is tough on managers at companies that make goods at plants around the globe.
They have to synchronize the flow of everything from raw materials and components, to finished goods. And they have to forecast demand accurately or know how to respond quickly – so they always have enough goods on hand without getting bogged down in margin-killing inventory.
That’s one reason the shares of “supply chain management” consulting companies caught fire in the late 1990s just as globalization hit its stride. But like the stocks riding many of the investment crazes of that era, supply chain management shares crashed and burned, leaving a few struggling survivors.
One of them is i2 Technologies (ITWO), a $15 stock which -- believe it or not -- once traded for more than $2,500 a share back in bubble days of 2000, adjusting for splits.
Unfortunately, the company took investors on the proverbial roller coaster ride yet once again last year. A series of troubles and mishaps spooked shareholders – from missed earnings and life-threatening debt levels, to a management overhaul and a forced exit from a stock exchange (since reversed).
Throughout the turmoil, insiders who believed the market was missing i2’s potential must have been champing at the bit to buy shares. Because when they finally got the chance in November as company rules allowed them to purchase, they did so in a big way. Several top insiders bought over $1 million worth of stock at the end of November, according to Thomson Financial.
That’s some kind of conviction. I think it’s a cue you will see decent gains over the course of a year or two if you follow their signal.
New leadership
In short, this is a company on the rebound that has burned investors in the past. So they’re passing up on the stock. But they’ll likely regret it a year from now since the company is now in competent hands, and it’s in the midst of a promising turnaround.
Since last March, i2 has been lead by Michael McGrath, who comes from a successful consulting company in supply chain management called PRTM, which McGrath he founded in the 1970s. His record shows he has a kind of Midas touch in this field. He’s now putting it to work in a turnaround that has many of the usual components.
Cost cutting and debt restructuring
First off, McGrath has cut costs by doing things like adjusting the size of the work force, cutting back on excessive billing for travel to visit clients in the flirtation phase, and even reducing the widespread use of corporate cell phones. McGrath has also cleaned up i2’s finances and restructured its debt. That’s brought down interest costs. But it’s also cleared concerns from the minds of potential clients who had worried that i2 might not be around in a year or two to keep its promises.
Revenue growth
All of this is good, but it won’t mean much without a solid kick to revenue growth. McGrath estimates the supply chain sector is growing at about 5% a year, a decent start. But he figures i2 will be able to grow much faster than that by taking share -- in part by moving into new sectors like pharmaceuticals, life sciences, government and defense.
“Even though we are largest in the marketplace, we still only have 8% of the market,” says McGrath. “It is very fragmented, and it does not need to be.”
McGrath sees potential in retail. Right now, Dell (DELL) uses i2 software to reschedule its factories every two hours. “They get new orders and have to determine where to make them and what material they will need to make them and where it is most cost effective to do this.” Big consumer electronics retailers like Best Buy (BBY) would love to have the same power, and McGrath believes i2 can provide it.
The company also has a new product line called Forecast Optimization which front-loads a consulting component. Theoretically, clients will see swift results in this phase, which will entice them into buying software in longer-term commitments.
The bottom line: JMP Securities analyst Patrick Walravens has a price target of $25 on i2, which would bring 65% gains for anyone who buys here. We may not see $25 in twelve months. But given the turnaround and the way insiders snapped up shares the first chance they got – at around $13.75 or near recent trading levels – this stock seems like a decent bet right here.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
January 05, 2006
Globalization is great if you like to buy -- or sell -- cheap goods.
But it is tough on managers at companies that make goods at plants around the globe.
They have to synchronize the flow of everything from raw materials and components, to finished goods. And they have to forecast demand accurately or know how to respond quickly – so they always have enough goods on hand without getting bogged down in margin-killing inventory.
That’s one reason the shares of “supply chain management” consulting companies caught fire in the late 1990s just as globalization hit its stride. But like the stocks riding many of the investment crazes of that era, supply chain management shares crashed and burned, leaving a few struggling survivors.
One of them is i2 Technologies (ITWO), a $15 stock which -- believe it or not -- once traded for more than $2,500 a share back in bubble days of 2000, adjusting for splits.
Unfortunately, the company took investors on the proverbial roller coaster ride yet once again last year. A series of troubles and mishaps spooked shareholders – from missed earnings and life-threatening debt levels, to a management overhaul and a forced exit from a stock exchange (since reversed).
Throughout the turmoil, insiders who believed the market was missing i2’s potential must have been champing at the bit to buy shares. Because when they finally got the chance in November as company rules allowed them to purchase, they did so in a big way. Several top insiders bought over $1 million worth of stock at the end of November, according to Thomson Financial.
That’s some kind of conviction. I think it’s a cue you will see decent gains over the course of a year or two if you follow their signal.
New leadership
In short, this is a company on the rebound that has burned investors in the past. So they’re passing up on the stock. But they’ll likely regret it a year from now since the company is now in competent hands, and it’s in the midst of a promising turnaround.
Since last March, i2 has been lead by Michael McGrath, who comes from a successful consulting company in supply chain management called PRTM, which McGrath he founded in the 1970s. His record shows he has a kind of Midas touch in this field. He’s now putting it to work in a turnaround that has many of the usual components.
Cost cutting and debt restructuring
First off, McGrath has cut costs by doing things like adjusting the size of the work force, cutting back on excessive billing for travel to visit clients in the flirtation phase, and even reducing the widespread use of corporate cell phones. McGrath has also cleaned up i2’s finances and restructured its debt. That’s brought down interest costs. But it’s also cleared concerns from the minds of potential clients who had worried that i2 might not be around in a year or two to keep its promises.
Revenue growth
All of this is good, but it won’t mean much without a solid kick to revenue growth. McGrath estimates the supply chain sector is growing at about 5% a year, a decent start. But he figures i2 will be able to grow much faster than that by taking share -- in part by moving into new sectors like pharmaceuticals, life sciences, government and defense.
“Even though we are largest in the marketplace, we still only have 8% of the market,” says McGrath. “It is very fragmented, and it does not need to be.”
McGrath sees potential in retail. Right now, Dell (DELL) uses i2 software to reschedule its factories every two hours. “They get new orders and have to determine where to make them and what material they will need to make them and where it is most cost effective to do this.” Big consumer electronics retailers like Best Buy (BBY) would love to have the same power, and McGrath believes i2 can provide it.
The company also has a new product line called Forecast Optimization which front-loads a consulting component. Theoretically, clients will see swift results in this phase, which will entice them into buying software in longer-term commitments.
The bottom line: JMP Securities analyst Patrick Walravens has a price target of $25 on i2, which would bring 65% gains for anyone who buys here. We may not see $25 in twelve months. But given the turnaround and the way insiders snapped up shares the first chance they got – at around $13.75 or near recent trading levels – this stock seems like a decent bet right here.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Wednesday, December 21, 2005
Five More Tax Loss Selling Plays to Buy Before the New Year
By Michael Brush
December 21, 2005
Only seven more shopping days left – to buy tax-loss selling candidates.
These are the 2005 losers that investors are dumping now so they can ring up tax losses before the year ends. They’re shopping for tax losses to offset 2005 capital gains in stocks.
The pressure they’ve been putting on stocks can create bargains -- especially if insiders are buying at the same time.
To find some of the best potential tax loss selling plays, I scanned the small-cap insider buy stocks to find the ones that are down the most for the year. This suggests tax loss selling is pressuring these stocks now as the year comes to a close. But they are potential winners for 2006 because insiders are bullish.
Here are five more to add to a list of five I wrote about in my last column here: click here
Tercica (TRCA) shareholders got a “baaa humbug” from the Food and Drug Administration a few days ago when the regulators took away marketing exclusivity for a growth hormone product. The stock got hammered, falling to $7 from $10. Then two insiders then stepped up and bought over $1.3 million worth of the stock. That’s pretty bullish!
Avanex (AVNX) shares have fallen to $1.11 from $3.50 this year, leaving plenty of shareholders disgruntled. More of them will be selling shares of this optical networks equipment provider as the year winds up to generate tax losses. But the chief executive recently bought $179,000 worth of stock at 90 cent a share – signaling value near current levels. For a brief walk down memory lane, consider that this stock once traded for $270 per share in the tech bubble days.
Inergy (NRGY) stands out among energy stocks because it is trading near its lows for the year. In contrast, most energy stocks have posted solid gains. The company processes and distributes propane and other derivatives of natural gas in the Midwest and Southeast. Insiders have been buying in the $26.50 to $28.90 range since the stock broke down. At recent levels this company -- which is a limited partnership -- offers a dividend in the 7.8% range. Be warned: Limited partnerships create special complications at tax time which you will have to deal with if you own this stock.
MCG Capital (MCGC), at $14.50, has an entire shareholder base that is looking at losses for 2005. That has to contribute to selling pressure as the year closes. But insiders, including the chief executive, are buying aggressively in the low $14 range. Down here, the company pays a hefty 11% dividend. MCG Capital provides financing and advisory services to smaller companies, especially in the media and telecom space. A.G. Edwards recently started coverage of the company with a buy rating.
MDC Partners (MDCA) shares have fallen to $6 from $11 since the start of the year. It’s been a long and grinding decline for shareholders of this Toronto-based company which provides marketing, and offers products and services that help create secure transactions. So there’s bound to be downward pressure on the stock now from investors who are throwing in the towel for the year. Down here, the stock trades cheap. It goes for .35 times sales and less than book value. Insiders, including the chief executive, recently purchased substantial amounts in the $6 range – or near current prices.
The bottom line: Buying these stocks now puts together two strategies that can give you an edge in the market: Picking up tax loss selling candidates and following the insider cues. I think all of these are buys right now for decent gains as a group in 2006 or beyond.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
December 21, 2005
Only seven more shopping days left – to buy tax-loss selling candidates.
These are the 2005 losers that investors are dumping now so they can ring up tax losses before the year ends. They’re shopping for tax losses to offset 2005 capital gains in stocks.
The pressure they’ve been putting on stocks can create bargains -- especially if insiders are buying at the same time.
To find some of the best potential tax loss selling plays, I scanned the small-cap insider buy stocks to find the ones that are down the most for the year. This suggests tax loss selling is pressuring these stocks now as the year comes to a close. But they are potential winners for 2006 because insiders are bullish.
Here are five more to add to a list of five I wrote about in my last column here: click here
Tercica (TRCA) shareholders got a “baaa humbug” from the Food and Drug Administration a few days ago when the regulators took away marketing exclusivity for a growth hormone product. The stock got hammered, falling to $7 from $10. Then two insiders then stepped up and bought over $1.3 million worth of the stock. That’s pretty bullish!
Avanex (AVNX) shares have fallen to $1.11 from $3.50 this year, leaving plenty of shareholders disgruntled. More of them will be selling shares of this optical networks equipment provider as the year winds up to generate tax losses. But the chief executive recently bought $179,000 worth of stock at 90 cent a share – signaling value near current levels. For a brief walk down memory lane, consider that this stock once traded for $270 per share in the tech bubble days.
Inergy (NRGY) stands out among energy stocks because it is trading near its lows for the year. In contrast, most energy stocks have posted solid gains. The company processes and distributes propane and other derivatives of natural gas in the Midwest and Southeast. Insiders have been buying in the $26.50 to $28.90 range since the stock broke down. At recent levels this company -- which is a limited partnership -- offers a dividend in the 7.8% range. Be warned: Limited partnerships create special complications at tax time which you will have to deal with if you own this stock.
MCG Capital (MCGC), at $14.50, has an entire shareholder base that is looking at losses for 2005. That has to contribute to selling pressure as the year closes. But insiders, including the chief executive, are buying aggressively in the low $14 range. Down here, the company pays a hefty 11% dividend. MCG Capital provides financing and advisory services to smaller companies, especially in the media and telecom space. A.G. Edwards recently started coverage of the company with a buy rating.
MDC Partners (MDCA) shares have fallen to $6 from $11 since the start of the year. It’s been a long and grinding decline for shareholders of this Toronto-based company which provides marketing, and offers products and services that help create secure transactions. So there’s bound to be downward pressure on the stock now from investors who are throwing in the towel for the year. Down here, the stock trades cheap. It goes for .35 times sales and less than book value. Insiders, including the chief executive, recently purchased substantial amounts in the $6 range – or near current prices.
The bottom line: Buying these stocks now puts together two strategies that can give you an edge in the market: Picking up tax loss selling candidates and following the insider cues. I think all of these are buys right now for decent gains as a group in 2006 or beyond.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site.
For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
Tuesday, December 20, 2005
Five Tax Loss Selling Candidates to Put in Your Shopping Bag This Holiday Season
By Michael Brush
December 20, 2005
We can’t let the year go by without applying our insider intelligence to a regular end-of-year activity for investors and traders alike: Picking up beaten down tax loss selling candidates on the cheap.
At the end of each year, many investors sell the year’s losers and “take losses” so they can match them up against gains and reduce their tax bills. This puts unusual downward pressure on stocks, pressure which may ease as the new year begins.
As usual when buying beaten down names, the trick is to avoid the notorious “value trap,” that is, the purchase of beaten down stocks that look cheap – but only stay cheap or get cheaper. How do we know which beaten down stocks from 2005 actually will come back?
We don’t.
But buying those which the insiders have been snapping up will definitely tilt the odds in our favor.
To find this season’s best tax loss selling candidates, I took two steps. First, I’ve scanned the smaller cap names to find stocks with some of the best insider buying profiles in recent weeks, according to my system. From that group, I selected the stocks whose charts look the ugliest for the year. A stock that’s now trading at or near its low for the year has the most shareholders underwater for the year. So they are more likely to be selling in the final days of the year to generate those tax losses.
Some of these names could begin to spring back right away in December once the tax loss selling pressure eases, and fresh 2006 retirement account money starts pouring into the market, looking for a home.
But as usual when following the insiders, it’s better to buy these instead with an eye for gains at some point in 2006 or 2007 – because insiders by nature tend to buy well ahead of the trends they think they see coming. In short, be patient with these names. But if you buy a group of them, the odds are good you’ll see a payoff that beats the market with ease over the next 18 months to two years.
Here’s this year’s crop of tax loss selling candidates.
GTX (GTXI) has fallen so hard this year, virtually anyone who purchased shares of this biotech company is now underwater. That’s a lot of potential sellers. But the buyers late this year include a director who purchased $744,000 worth of the stock in December. Directors also purchased over $10 million worth of stock back in October as part of a follow-on offering.
GTX is working on products that may prevent prostate cancer, treat the side effects of androgen deprivation therapy for advanced prostate cancer, and help with weight loss and muscle wasting associated with severe burns and cancer.
Chemtura Corporation (CEM), a specialty chemical company, saw its shares blow up in September when it announced poor results for the third quarter. The stock has rebounded from the lows it hit in October, but many people who bought this year are still looking at losses. Their selling is putting downward pressure on the stock right now. Insiders, however, have been actively buying in the $12 range – or near current levels.
Restoration Harware (RSTO) was a stock I featured here back on April 20 at just the right time (click here for article). Within three months this upscale home furnishings retailer had gained almost 50%. But now it’s back down to levels near where I first wrote about it, because of a slowdown in sales growth. Insiders, however, are buying again in a big way. One director, for example, has purchased about $4.8 million worth of the stock in the $5.40 to $6.50 range in the pull back. That’s a bullish signal if there ever was one. The retailer looks cheap again, with a
price to sales ratio of .42.
ActivCard (ACTI), which makes digital identity systems, has had such a tough year the stock is now trading down near its cash-per-share levels. How much lower can it go? After all, with $3.49 per share in cash, managers could close the company and hand over all the money to shareholders without causing them much damage – because the stock recently traded for $3.58. One insider recently plunked down $759,000 to buy 215,500 shares. The company is changing its name to ActivIdentity.
UTStarcom (UTSI), a major supplier of wireless and DSL equipment to Chinese telecommunications companies, has gotten pummeled this year. Shares have been slammed to $8.45 from $22. Around $8, a director bought nearly $400,000 worth of stock. The shares are cheap, at .33 times sales.
The bottom line: Buying these stocks now puts together two strategies that can give you an edge in the market: Picking up tax loss selling candidates and following the insider cues. I think all of these are buys right now for decent gains as a group in 2006 or beyond.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site. For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
December 20, 2005
We can’t let the year go by without applying our insider intelligence to a regular end-of-year activity for investors and traders alike: Picking up beaten down tax loss selling candidates on the cheap.
At the end of each year, many investors sell the year’s losers and “take losses” so they can match them up against gains and reduce their tax bills. This puts unusual downward pressure on stocks, pressure which may ease as the new year begins.
As usual when buying beaten down names, the trick is to avoid the notorious “value trap,” that is, the purchase of beaten down stocks that look cheap – but only stay cheap or get cheaper. How do we know which beaten down stocks from 2005 actually will come back?
We don’t.
But buying those which the insiders have been snapping up will definitely tilt the odds in our favor.
To find this season’s best tax loss selling candidates, I took two steps. First, I’ve scanned the smaller cap names to find stocks with some of the best insider buying profiles in recent weeks, according to my system. From that group, I selected the stocks whose charts look the ugliest for the year. A stock that’s now trading at or near its low for the year has the most shareholders underwater for the year. So they are more likely to be selling in the final days of the year to generate those tax losses.
Some of these names could begin to spring back right away in December once the tax loss selling pressure eases, and fresh 2006 retirement account money starts pouring into the market, looking for a home.
But as usual when following the insiders, it’s better to buy these instead with an eye for gains at some point in 2006 or 2007 – because insiders by nature tend to buy well ahead of the trends they think they see coming. In short, be patient with these names. But if you buy a group of them, the odds are good you’ll see a payoff that beats the market with ease over the next 18 months to two years.
Here’s this year’s crop of tax loss selling candidates.
GTX (GTXI) has fallen so hard this year, virtually anyone who purchased shares of this biotech company is now underwater. That’s a lot of potential sellers. But the buyers late this year include a director who purchased $744,000 worth of the stock in December. Directors also purchased over $10 million worth of stock back in October as part of a follow-on offering.
GTX is working on products that may prevent prostate cancer, treat the side effects of androgen deprivation therapy for advanced prostate cancer, and help with weight loss and muscle wasting associated with severe burns and cancer.
Chemtura Corporation (CEM), a specialty chemical company, saw its shares blow up in September when it announced poor results for the third quarter. The stock has rebounded from the lows it hit in October, but many people who bought this year are still looking at losses. Their selling is putting downward pressure on the stock right now. Insiders, however, have been actively buying in the $12 range – or near current levels.
Restoration Harware (RSTO) was a stock I featured here back on April 20 at just the right time (click here for article). Within three months this upscale home furnishings retailer had gained almost 50%. But now it’s back down to levels near where I first wrote about it, because of a slowdown in sales growth. Insiders, however, are buying again in a big way. One director, for example, has purchased about $4.8 million worth of the stock in the $5.40 to $6.50 range in the pull back. That’s a bullish signal if there ever was one. The retailer looks cheap again, with a
price to sales ratio of .42.
ActivCard (ACTI), which makes digital identity systems, has had such a tough year the stock is now trading down near its cash-per-share levels. How much lower can it go? After all, with $3.49 per share in cash, managers could close the company and hand over all the money to shareholders without causing them much damage – because the stock recently traded for $3.58. One insider recently plunked down $759,000 to buy 215,500 shares. The company is changing its name to ActivIdentity.
UTStarcom (UTSI), a major supplier of wireless and DSL equipment to Chinese telecommunications companies, has gotten pummeled this year. Shares have been slammed to $8.45 from $22. Around $8, a director bought nearly $400,000 worth of stock. The shares are cheap, at .33 times sales.
The bottom line: Buying these stocks now puts together two strategies that can give you an edge in the market: Picking up tax loss selling candidates and following the insider cues. I think all of these are buys right now for decent gains as a group in 2006 or beyond.
Disclaimer
At the time of publication, Michael Brush did not own or control shares in any of the companies listed in this column. Mr. Brush is an independent columnist for this web site. For more on Insiders Corner disclosure, see the disclosure section in About Insiders Corner: http://www.investorideas.com/insiderscorner/. InvestorIdeas.com Disclaimer: www.InvestorIdeas.com/About/Disclaimer.asp. InvestorIdeas is not affiliated or compensated by the companies mentioned in this article.
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