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- CANSLIM.net's TOP 10 STOCKS -
With all due apologies
to David Letterman for copying his popular format,
here is CANSLIM.net's Top 10 List of
stocks that have been showing some very bullish
action, particularly in the past week.
Sure, a breakout can be a pretty clear
“buy signal”, but you still must employ smart
trading tactics to pick a point where you are
going to be comfortable knowing that the risk/reward
potential suits you.
Have a very close look at the following
stocks to determine whether or not they are
the right ideas for you, and pick a point where
you aren’t chasing them too far extended from
a good base.
What
is the backdrop for this special report we've
prepared? Well, collectively, the Dow
Industrials, Nasdaq Composite, and S&P 500 all
managed to close above their 200-day moving
averages, a point noted in the latest CANSLIM.net
Morning Market Commentary. While the major indices
closed out the past week with very strong gains,
it was widely noted that the Dow Industrials’
rise of 8.4% was its best weekly gain
since October 1982.
Need we remind anyone that in 1982 the
market was just beginning a major bull market?
The sustainability of the latest rally will
eventually be challenged.
It is only reasonable to expect pullbacks
along the way, so the important thing to realize
when an ideal stock blasts right by before you
got on board, there will almost certainly be
some backing and filling done by most of these
first ideas blasting out of the gate.
So, as long as the broad market is able
to maintain its broad based upward trend, you
might find an opportunity to buy into the best
high-ranked leaders on any normal dips in price.
There should also be many other winners coming
along in the following days and weeks.
So, recognize the chart characteristics
of the latest breakouts and be ready to have
quick reflexes when the next stock you are watching
crosses that important buy point. And since there are never any guarantees in this business, watch the
market closely, and if the market starts to
fail miserably and you see your stock breaking
down, always be willing to walk away with a
small loss to minimize the damage and protect
yourself from a more devastating loss that could
really cause you serious financial harm.
And the list below is in
no particular order, by the way....
Stratasys, Inc. (Nasdaq:
SSYS $13.00) is engaged in the 3-D imaging
business, which is referred to as rapid prototyping.
It makes prototyping devices that allow engineers
and designers to create models and prototypes
from computer-aided design (CAD) workstations.
Its customers include GM, Intel, Boeing,
Lego, Honda, Lockheed Martin, and Ford.
Analysts expect 2003 EPS to grow 48%
to $0.83. It has 4.5 million shares in the float, making it a small
and potentially explosive growth prospect. The
chart resembles a cup-with-handle, and it is
impossible to miss volume when it is more than
six times normal, as was the case on Friday
as it blasted off.
PRODUCED
GAINS OF OVER +346% SINCE REPORT WAS ISSUED
Stericycle (Nasdaq:
SRCL $39.42) has a fully integrated, national
medical waste management network. Its services
and operations are comprised of collection,
transportation, treatment, disposal and recycling,
while it also offers related training and education
programs, consulting services and product sales.
Unmistakably bullish volume has driven it up
substantially in the past week, allowing it
to break out of a 5-month base.
This action may be signaling the beginning
of a major advance in price, while short-term
we might expect a dip to be normal.
Support should be fairly solid in the
$37.00 range, so on any weakness you
can consider this idea for purchase and have
a close stop-out point.
PRODUCED
GAINS OF OVER +37% SINCE REPORT WAS ISSUED
PCTEL, Inc. (Nasdaq:
PCTI $8.82) is a provider of Internet access
solutions and wireless mobility software. Last week the company announced a new multi-year licensing agreement
with Boingo Wireless, the largest aggregator
of Wi-Fi hot spots for the wireless industry.
The action that followed was explosive,
and the stock blasted out of a better than 4-month
base on heavy volume.
Of course, low priced stocks are not
always the most predictable, and looking back
at this stock’s 2000 highs it is easy to see
its history as a concern.
However, fundamentals seem to justify
some of the recent strength as earnings growth
has a direct correlation with share prices.
PRODUCED
GAINS OF OVER +61% SINCE REPORT WAS ISSUED
FindWhat.com
(Nasdaq:FWHT $10.00) operates a bid-for-position
search engine that distributes its listings
to third-party websites, and also runs BeFirst.com
RankPro, a search engine optimization service.
This is an Internet stock without the
scary history that most others in the group
will have to continue living with, and the company
has the right kind of fundamental picture that
underlines and helps to justify its recent price
strength. We are not simply mentioning it because
Bambi Francisco of CBS MarketWatch said it “ended
the day with a price-to-earnings multiple of
16 times, which appears relatively reasonable
compared to the other search companies.” The internet group is included among those leading the rally,
while EBAY, AMZN, and YHOO are the sector’s
“Blue Chips”.
PRODUCED GAINS
OF OVER +179% SINCE REPORT WAS ISSUED
Brown Shoe Company,
Inc. (NYSE:BWS $29.23) is a footwear retailer
and wholesaler that operates retail shoe stores
and is involved in the sourcing and marketing
of footwear for women, men and children.
The Retail sector is helping lead the
market, with a number of issues in the group
looking like promising candidates to have continued
run-ups.
Reebok (RBK) has 60 million shares outstanding,
when speaking of others with confirming strength,
meanwhile the 17 million shares outstanding
for BWS may allow its stock to be more fleet
footed.
It lifted off from a long flat base with
a high volume breakout on Friday.
The company has solid fundamentals and
could be a step in the right direction for a
CANSLIM fan’s portfolio.
PRODUCED GAINS
OF OVER +43% SINCE REPORT WAS ISSUED
Advanced Neuromodulation
(Nasdaq:ANSI $39.32) makes advanced implantable
devices that deliver electrical current or drugs
directly to targeted areas of the body to manage
chronic pain. Above average volume has accompanied its recent rise to near
all-time highs.
It is in the Medical-Products group that
features numerous strong leaders, providing
confirming strength.
The past three quarterly reports have
included strong earnings increases over the
year earlier period ranging from 138%-160%.
Earnings growth like that can help to
justify a major rise in share prices.
A small 12.2 million share supply
of outstanding shares also might allow for its
shares to climb quickly when under accumulation
by institutional investors.
PRODUCED GAINS
OF OVER +84% SINCE REPORT WAS ISSUED
Endo Pharmaceuticals
Hldg (Nasdaq:ENDP $11.03) is engaged in
the research, development, sale and marketing
of branded and generic prescription pharmaceuticals
used primarily to treat and manage pain. Numerous
generic drug makers are showing similar strength
and bullish charts. Although ENDP
still faces important resistance at the $13
area where in 2002 it twice reversed and
had to regroup, the strong sales revenue and
earnings growth it is demonstrating make it
entirely likely to revisit and exceed those
historic highs while it now sits 15.5%
under its historic best. Percentage increases
in earnings over the year earlier have been
in the triple digits, as in the past four announcements
it came through with $0.05 vs -$0.02,
$0.22 vs $0.11, $0.25 vs
$0.10, and $0.29 vs $0.11
per share in earnings.
PRODUCED GAINS
OF OVER +146% SINCE REPORT WAS ISSUED
Open Text Corporation
(Nasdaq:OTEX $28.21) makes, sells, and supports
collaboration and knowledge management software
for use on intranets, extranets and the Internet.
Its principal product line is Livelink,
a product for global enterprises.
Sales appear to be increasing modestly,
and earnings increases in the past quarterly
reports were up 30%, up 67%, and
in the most recent December '02 quarter up
33%.
It is a high ranked leader with growing
institutional interest, as at least 16
additional mutual funds have bought an interest
in this company in the past 6 months.
One of the things fans of CANSLIM like to see
is growing interest from fund managers.
PRODUCED GAINS
OF OVER +133% SINCE REPORT WAS ISSUED
UTi Worldwide
Inc. (Nasdaq:UTIW $29.57) develops proprietary
information technology systems which enable
its customers to use the Internet to access
its Web-based suite of supply chain software
applications called UTi eMpower.
It is ranked second best overall in the
Transportation-Services group with Expeditors
Intl Wash Inc. (EXPD) and C H Robinson Worldwide
(CHRW) among others in the group providing confirming
strength.
Sequentially increasing sales revenue
and earnings increases over the past several
quarterly comparisons show clear acceleration
in the top and bottom line numbers.
Companies in the transportation sector
are often included among the first stocks giving
clues when the economy is improving, as shipments
of goods increase.
PRODUCED GAINS
OF OVER +161% SINCE REPORT WAS ISSUED
Career Education Corp (Nasdaq:CECO
$51.01)
is a provider of
private, for-profit postsecondary education,
with at least 42 campuses throughout
the United States, Canada, the United Kingdom
and other countries.
One of the striking characteristics of
this company’s extremely solid fundamental performance
is that earnings increases over the year earlier
period in the past eight quarterly comparisons
have ranged from 45% to 117%.
Also, a number of other issues in the
Commercial Services-Schools group are showing
similarly bullish charts.
That provides confirmation that industry
trends seem to be working in the company’s favor. Another encouraging trait is the increasing interest from the
institutional crowd the company is generating.
PRODUCED GAINS
OF OVER +178% SINCE REPORT WAS ISSUED
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