This is what we sent to our free alert Email subs last week on the 16th— looks timely no?
Based on our Models, we think the market has hit our 1650-1664 topping zone. A projected correction from here is very likely and could be over a few weeks of time.
We also think GOLD may be within a few days of a low and re-test of 1322 lows, giving Gold stocks a possible near term entry point again…
Taking profits on high fliers like HIMX, YY, INVN, and or others not a bad idea…
Shipping stocks also rocking today, a call we made back in march… they rallied hard after our call, then pulled back, and now rallying again.
Gold stocks next??
May 23rd update to subs below: (Email alert members only)
So now you see the market topped briefly at 1686 intra-day but closed below our 1664 top zone. You also saw GOLD bottom out and GOLD stocks are moving higher. We try to be a bit early. The SP 500 could drop to the 1614 areas and after that we will go from there.
We also suggested taking profits on those high fliers… now you see why. You want to sneak out the door while everyone is high fiving themselves at the stock party around the water cooler. Then when the party ends and everyone is looking around at the mess, you already cleaned your stock profits up…
The reality is the drop in gold over 21 months is a normal part of a bull bear cycle. At 1923 Gold had rallied for 34 months from 686-1923. A 38% retracement is near the 1451 area, and a 38% retrace of the entire bull is near 1304-1310 roughly… and we are simply bouncing in these areas in our opinion. Sentiment is at decade lows, put to call ratios at decade highs and on and on… insiders buying like crazy in mining sector at 13 to 1 vs sellers. So this is all part and parcel of how a sector completes a BEAR phase, and then will turn to a new bull phase. Its no different than 2000-2002 stocks, 2008-2009 stocks, bear cycles are common. The key is knowing when the final stages of capitulation are here… and that seems alot closer than farther…
Editors note: This was emailed May 9th to our Alert members, and membership is FREE! No string… we just pay it forward. Our last 2 trades prior to this HIMX up 53% and YY up 53% both within 2-4 weeks each. Join us using the subscribe button for the next alerts!
INVN- InvenSense-11.91 at time of Report
We are suggesting long positions in INVN here anywhere in the 11.70-12.15 areas as entry points.
INVN if you are not aware, is rapidly emerging in our opinion and others as THE LEADER in motion sensing technologies. These vary from the motion sensing WII games you or your kids play, to gyroscopic devices, controllers, chips and more that will be going into smart phones, tablets, games, and soon wearable computing devices.
INVN came public not far from where it trades now with a high of 22 and a low around 9.
Last week they reported YET ANOTHER amazingly strong quarter of 65% sales growth and 110% earnings per share growth. The stock lifted from 9 to 12 and we see a base pattern here that will soon emerge with projected higher prices into the 15-16 area for 25-33% gains from here prior to the next earnings report.
They are taking market share from their main competitor STM, which went so far as to file a baseless patent infringement suit against them last year. 8 of 9 claims have already been laughed at by the patent office. STM is worried that INVN will take their Apple business away, and they should be because its going to happen based on what we are reading and management is indicating.
Already, INVN has 30% of their business from Samsung alone…and have over 7,000 developers working on products from their technologies.
We would advise you read up on them at seekingalpha.com for a lot of good articles. Type in INVN in the search box and read.
In the meantime, we look for this stock to explode higher in the coming months from this $12 area. Currently trading at 15 x earnings estimates with projected 30-50% growth well into the future… its not going to stay cheap for long.
In the past few quarters institutions and mutual funds are increasing their positions aggressively while its cheap, we know, we read the filings.
Below is the chart patterns we like…. the weekly MACD is about to break to the upside confirming a new uptrend… we plan to be on board.
YY and HIMX- Free Trade Alerts Update
YY- This stock was E-mailed to our free alert subscribers on April 25th at 16.35 per share with a chart.
After earnings today we are up 43% so far on this position as of May 8th trading. Our targets were $20 plus and we did a chart showing same with an arrow.
Our trade prior to this was HIMX, which was March 27th–which has run up as much as 53% and we still like it.
We just put out a new trade this week, so join us to get details and E-mail us for the password to open the report.
Editors Note: This was originally sent to Email Alert members only on April 29th. Also this article was published on Seeking Alpha on May 1st that we authored. You must subscribe to our Email alerts to get reports. Our last two HIMX is up 45% and YY so far 13%.
After our alert… and our article… we saw 2 more positive articles on ATOS published on Seeking Alpha, A positive update from Zacks Research, and a PR from ATOS on a new sale to a medical distributor. We like to be early…
ATOS Genetics (ATOS)-A Breast Cancer Paradigm Shift in the making?
Current Price $6.90 as of 4/29 Report
Short Term-Intermediate target is $9.00-$9.50 for a potential 30% plus gain
52 week high 12.40; 52 week low 3.44
13mm shares o/s ;800,000 float ; 75% insider held ;
Market cap: 90 million
Addressable Market: 100 Billion (Per CEO Steven Quay)
Potential to be the “Pap Smear” test for Breast cancer detection
Some of the best gains in growth stocks if not most, start off with a healthy dose of skepticism and or misunderstanding of business models. The list is very long, but to mention just a few: Amazon (AMZN), Apple (AAPL), Linked-In (LNKD), Green Mountain Coffee (GMCR), Netflix (NFLX) and on and on. It takes guts and foresight to sit through some of the drama, misinterpretations, skepticism, and pullbacks that occur along the way to great gains. All of those companies had huge addressable markets in front of them, and they had the mousetrap everyone wanted. ATOS Genetics we think fits the same bill right now in the huge worldwide addressable market of Breast Cancer detection, testing, and therapy.
ATOS is a medical diagnostics company focused on the prevention of breast cancer through the development and commercialization of diagnostic tests that can detect precursors to breast cancer, and through the research, development and ultimate commercialization of treatments for precancerous lesions. If you want a company that has the potential to create dramatic change in the way Breast Cancer is treated, detected, and managed then we think it requires further consideration and due diligence by investors. The recent pullback in the shares we think is a combination of traders, confusion, and misinterpretation of very good news and developments.
One of the ingredients we look for prior to entering a position in a small cap growth stock is skepticism, misinterpretation of news or filings, and or confusion by investors ahead of major catalysts or fundamentally meaningful changes that are just around the corner. Samples recently include our article on Wearable computing and HIMX, (HIMX) which rallied some 50% in the weeks after our article pointing out the opportunity. There was confusion there regarding supplying components to Google and a bit of research and digging would have cleared that up.
Atossa Genetics we also think represents a dramatic opportunity for long term investors and is at a psychological buy point right now. Small Cap Biotech-Healthcare Analyst, Grant Zeng of Zacks Research recently projected a 79% annualized compounded growth rate over the next 5 years alone and upped their target to $15. There is skepticism, a lack of awareness, and in a recent case a misunderstanding of a stock filing to boot. Let’s examine the Bull case for Atossa and why we think the shares represent extreme value and timeliness for purchase.
Confusion: Recently on April 5th for example, a headline from Fly on The Wall was totally misleading and probably led inexperienced investors to sell the stock. The headline read : “Atossa Genetics files to sell 2.83m shares of common stock for holders”. This headline could not be further from the truth, a perfect sample of confusion and an inappropriate use of the English language. As part of their recent share purchase agreement with the Institutional Investor, Aspire Capital LLC, it was agreed that a prospectus would be filed and therefore shares would be “registered” for future sale under SEC regulations. When the registration was filed on April 5th by ATOS, it was to meet the terms of the agreement, and not for any shareholder to be selling anything near term. Aspire in fact has only just begun to purchase shares from ATOS, most recently at $12.00 per share for 83,000 shares. These shares are now fully registered and the 2.8 million figure is simply a mathematical guesstimate of the number of shares that may be sold to Aspire in the future based on a weighted average price at the time of the filing and the $30 million investment agreement.
If you read that headline, you may have assumed that insiders were selling 2.83 million shares of ATOS, when in fact the opposite is true. Insiders are holding some 10 million shares of the 13 million total outstanding, and in this case, Aspire Capital is expected to purchase millions of shares at varying prices going forward, and those prices are actually dictated by ATOS, and not the market nor Aspire. These shares were approved and registered by the SEC on April 24th this past week, yet another filing headline that probably caused selling late in the trading week. Those who don’t take the time to research and understand SEC Filings probably assumed 3 million shares are about to hit the market, when the opposite is actually true.
Aspire Capital is a well respected investment firm with a history of being a long term holder and investor in biotech and health related companies. They are also an active shareholder and will be sure to assist ATOS in reaching their long term potential. Per the CEO of Aspire, “Over the past few months we have spent a lot of time with the management team and done significant due diligence on Atossa as well as talked with physicians and users of its products. During this process, we have come to see the tremendous opportunity that Atossa presents as the ‘Pap Smear’ for the breast and for early non-invasive treatment of breast cancer,” commented Steven G. Martin, Managing Member of Aspire Capital.” (Source: Market Wired Press Release March 28th, 2013)
Other catalysts and value propositions to consider:
May 4th-8th Conference: Atossa will be exhibiting and presenting at the upcoming 61st annual Clinical Meeting of the American Congress of Obstetrics and Gynecology in New Orleans. The ForeCYTE Breast Health Test, developed and marketed by Atossa Genetics, detects reversible precancerous conditions in the breast up to eight years before they become cancer. The test uses a hand-held, FDA Class II medical device that is quick, painless, and non-invasive and can be administered during an OB/GYN office visit. Unlike mammograms, which are commonly recommended for women starting at age 40 to 50, the ForeCYTE Breast Health Test is more age agnostic, uses no radiation and does not require invasive biopsy needles or surgical incisions.
Insider ownership: Extremely high on ATOS at over 75%. The CEO himself owns nearly 5 million shares of the 13 million share count. Dr. Steven Quay is the original brains behind the various breast cancer tests themselves, and the $50 million invested over 14 years with 179 patents and quite a few more pending represents real value by itself. Chief Scientific Officer Shu-Chih Chen holds nearly as many shares as the CEO.
Share Float: Only 800,000 shares were sold in the IPO at $5 per share, so barely 6% of the shares outstanding are freely trading. 83,000 shares were recently sold to Aspire Capital at $12.00 per share, a 140% premium to the IPO price. Therefore less than 1,000,000 shares of trading stock is available and often why for now, the shares can move sharply higher or lower on any given day. This also though is an ingredient we look for in small companies that have a lot of catalysts and developments to drive shares much higher.
Nationwide Rollout: The company is aggressively rolling out 4 Breast Cancer detection and RNAi based tests this year, with 2 already being met with rapid adoption and 2 more to come. (two early detection tests (ForeCYTE and FullCYTE) and two cancer survivor tests (NextCYTE and ArgusCYTE). With 40 million mammograms administered each year, Atossa’s aim is to eventually replace these with their own tests. This revenue potential alone at even a fraction of that market is many multiples over the total market cap of the company today. In fact, two major health provider and management organizations have already signed on for reimbursement and distribution related agreements with FedMed, which covers 40 million Americans, and Multi-Plan with another 20% of Americans covered under their diagnostic management plans. As the company rolls out the additional two tests this calendar year we expect wider adoption and further share price appreciation.
Growth: One the top small cap biotech analysts in the country is Grant Zeng, who is with Zacks Research. He has written about or commented on ATOS a few times in the past 4-6 weeks. Recently he upgraded his 12 month target to $15 per share based on the recent agreement with FedMed and his expectations of 79% compounded growth rates in sales over the next 5 years. His upgraded price came with ATOS trading at $10.90 per share only 4 weeks ago, and now you can enter at a much better discount near $7.00. Any additional agreements with HMO providers or others this year are likely to spark a sharp rally in the shares of ATOS in our opinion. In addition, Sidoti recently recommended the stock on April 15th with their own buy rating, joining Mr. Zeng in early coverage.
Technicals: The stock has just recently retraced a Fibonacci 61% of the gains from the 3′s to the 12′s over the several weeks as traders have moved on. We argue that these types of retracements are commonplace in emerging growth stocks and usually the tail end of them revolves around poor interpretation of news, filings, or misunderstandings and low sentiment. Often traders who chased the stock up to $12 placed stop loss orders and they finally trigger, ushering in a new wave of stronger hands from the weak hands.
In summary, we like ATOS Genetics to accumulate during this pullback with the potential to rally towards the 52 week highs in the low 12′s in the coming months as further developments are announced. Sidoti and also Grant Zeng of Zacks Research are early in coverage and we would like to join them as well while the opportunity presents itself. Once investors re-interpret recent developments correctly and put 2 and 2 together, and with only 800,000 shares in the public float, we think the shares will quickly recover.
(We alerted this trade to buy 4.60 or lower on the pullback on Mar 27th via e-mail alert to our free alert subscribers, if you didnt subscribe, let alone open your e-mail we can’t do much more)
Editors Note: March 28th closing, one day after our alert… HIMX rallied 17% in 1 day on massive volume of over 8 million shares
We see a huge volume and price spike warning on HIMX this week, and we think it presages a big move in April if we are right in this Japanese Semi-conductor fab chip firm. We see traders running and tripping over themselves to get on board in the coming weeks.
Our targets are 6.25-7.25 out of this 4.55 area pullback.
It appears either that a B wave has completed already and C wave up or wave 3 has started… or its close—
Never any guarantees, but with the Google Glass contract lined up, this has all the ingredients for a hyper move