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CenturyTel CTL as a core of the portfolio

CenturyTel CTL as a core of the portfolio

The whole Sunday I spent rereading and polishing my stock pick strategy. Recently I deviated from several rules I originally used. I thought I already remembered them all or I could outsmart the market again. What a costly thinking! This time I, however, wrote them all down on the paper and created a checklist in Excel spreadsheet with data necessary to input manually (in this case I would really remember those rules).

What screening rules do I use?

It’s simple. As the Reverse Scale Strategy defines I use stocks which:

  1. Are making new 52-Week Price highs.
  2. Have the highest 1-year sales growth possible.
  3. Have the highest 1-year price/share growth ratio possible.
  4. Have the highest growth factor possible (this one is calculated based on the ratios as in items #2 & #3.
  5. The daily volume is above 300k.
  6. The stock price is not overextended more than 20% above 50 day MA.
  7. The stock is trending upwards without excessive volatility – checked on a daily (YTD), weekly, 1 year and 5 years chart.
  8. The stock has a reasonable price to sales ratio P/S – when I add all selected stocks together I calculate an average ratio of all stocks and then check the particular stock’s ratio with the average. For example the screen I ran today has an average of 1.29 and CTL has P/S of 2.73. This number is among those higher ones, but acceptable for telecommunication companies.
  9. The company is not among banks, miscellaneous, savings & loans, utility, mining and real estate (REIT) companies.
  10. Market capitalization 5B – 10B
  11. Sales growth (revenue) double digit growth ratio in the most recent year.

CenturyTel, Inc. (CTL)

CenturyTel is a company which fits my screening criteria. It has sustainable growth, it is trending up (the price is above 50-day MA and 200-day MA), it is not overextended, creating new 52-week highs. Its quarterly revenue growth ratio is at 188%, price growth at 62%. It is a telecommunication company operating a range of communications services, including local and long distance voice, Internet access, and broadband services in the continental United States.

Centurytel, Inc.

I decided to buy 9 shares of this stock tomorrow at market open.




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STEC in consolidation

STEC in consolidation

In my weekly Picks History post I mentioned STEC showing a reversal sign. Although I am losing my interest in this stock, because it doesn’t meet my picks criteria any more, I am just curious how the stock will develop and I may consider a small position as a swing trade based purely on technical analysis.

When I look at the chart of STEC I can see that the stock is still downtrending (1) even though the StochasticRSI indicator came up with a reversal signal (2). The stock moved higher, but then flailed again. The good sign is that the volume is declining (3). It is still significantly higher than prior November 2, 2009 but falling down. And more, the stock is creating a consolidation at its support line at $12.5 (4).

STEC

Now, four scenarios may happen:

  1. The stock will continue drifting down in slow pace and declining volume and all my technical analysis will be off. We will have to wait for new development.
  2. The stock falls down on higher than average or heavy volume (and todays action was close to this – even though the stock closed higher than yesterday, overall the trend is negative and volume was rising again, which may support further fall or support the reversal). If the stock falls further down on heavy volume, it would be a great opportunity to go short. I do not short stock so I will take no action.
  3. The stock will move higher on rising or high volume and will continue in uptrend on rising volume then I may consider opening a small position. However, when you look at today’s intraday movement, the most of the run happened in the morning and the rest of the day the stock was losing steam. I am not much confident about a strong buying power, but it may come.
  4. The stock will continue jumping at its support line (4) and no movement happens. It may be a positive sign at least in the case of losing selling pressure which we could experience several days ago. On the other hand the stock will have no buying power either and it will continue in its consolidation for several days or even weeks or months. We will have to wait some more days for confirmation or break out.
STEC
STEC intraday trading, MarketWatch.com

As I said, I am not interested in this stock much, but I am interested in seeing whether my assumptions will be correct or not. I may or may not enter in this stock or I may just watch if I was correct or not. My main criteria for the stock picking are that the stock must be trading above 50 day and 200 day MA or cross it over and this stock is not there at all. However, as a highly speculative swing trade this may be a great opportunity to make some bucks out of it.




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Posted by MartZee November 17, 2009
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Netezza (NZ) added to portfolio


I decided to buy Netezza (NZ) this morning:


11/17/2009    09:30:16   Bought  10  NZ  @  11.12




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Posted by MartZee November 01, 2009
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Picks 10/26 – 10/30


New [tag]stock picks[/tag] this week:

[tag]Medifast, Inc.[/tag] (MED)

Existing & new [tag]holdings[/tag]:

Symbol Qty Last Gain($) Gain(%)
[tag]JADE[/tag] 34 3.19 -9.86 -8.33
[tag]MED[/tag] 8 22.02 9.84 5.92
[tag]ORS[/tag] 6 0.78 -20.73 -28.40
[tag]RINO[/tag] 4 19.52 -12.84 -14.12
[tag]V[/tag] 11 75.76 80.53 10.70

Contribution this week: $0

Current [tag]capital exposure[/tag]: -5.00%     Learn more

New positions available to open: 0     Learn more

Starting [tag]account value[/tag] = $1,864.19

Account value = $1,805.64 (without margin)

Buying power = $557.32

[tag]Portfolio Gain/loss[/tag] this week = -3.14%

[tag]Portfolio[/tag] Gain/Loss for OCTOBER 2009 = 1.48%

Portfolio Gain/loss for 2009 = -25.07%

[tag]Annual Return[/tag] (CAGR): -30.57%

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Posted by MartZee October 29, 2009
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Medifast bought back


Medifast (MED) beats expectations on earnings. The consensus estimate was 19 c per share, MED reported 23 c per share. So I bought MED back at the market opening:

10/29/2009    09:30:29    Bought  8  MED  @  20.79




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Posted by MartZee October 28, 2009
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Medifast (MED) reporting earnings

Medifast (MED) reporting earnings

Medifast (MED) is going to report earnings tomorrow morning prior the market opening. The stock has been dumped by investors recently (maybe they were unloading prior reporting earnings) so I was stopped out. Since the peak on October 21, 2009 the stock lost almost 21%. When looking at the after hours trading, it seems the stock will shoot up tomorrow morning:

Medifast - MarketWatch.com

I consider this stock as good one and if it happens I am buying back. Let’s wait for tomorrow morning…




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Visa beats expectations

Visa beats expectations
OCT27 Visa (V) did better than expected, which makes me laugh. Not because I might be making more money holding this stock, but because I still have on my mind all those doomsday analysts predictions, analysts and traders overreacting and freaking about earnings and company’s sustainability. A few days ago, Visa was falling for no particular reason, or maybe there was a reason, but I couldn’t find it, and even after the company reported better than expected results, the stock went through a sell off at the very end of the trading day just to reverse and shoot up in after hours trading. Sometimes, I really wish to know what is behind the scene, what moves the crowd to sell the stock in one minute and buy it back in the second one.

Here is what happened:

VISA

Of course, you never know what will happen in the market. Wall Street is too obsessed with earnings and sometimes pays too much attention to it. However, there is no guarantee, that a stock of a company such as Visa, which posted better than expected result, increased dividends and announced buying back its stocks, will grow. Many times you could see that a stock of a company with great results was falling and a stock of a company with bad results was growing and making new highs.

Maybe, these results, Visa posted despite of all those who were recommending selling it, prove again, that this company has very little to do with credit crunch, so when credit card companies get into a trouble, it doesn’t necessarily mean Visa is in trouble too. People, maybe, do not use credit cards as much as they used to, but they started using debit cards, and just take a look what logo your debit card holds on it. Anytime you use it, Visa gets its share.

It still may not mean anything anyway…




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