Selling is continuing @ frenzied pace on weak economic data......
Selling is on lighter volume.......
What should you make of this selling.....Like I have always said...it is always a good time to buy stocks on Sale.....
2008 has started...so it is important to KNOW which stock is going to make you"serious money" vs some stocks which you happen to LIKE......there is tremendous difference between liking some stocks because they are also liked by many vs actually ending up making money.....
Some strong stocks are positioned to move UP...while others may NEED rest for a while...FA & TA will tell you which ones are ready to move UP......so your money is put to productive use ..vs sitting there and doing nothing.......
In my portfolio :
BIDU down $7.92...on market weakness.....first target $429.88.....
MA down 52 Cents.....after breakout earlier in the day....breakout point $217.79 with a target of $236.60....
CSIQ UP 52 cents...ready to breakout @ $29.51 with a target of $34.25....
RIMM UP 31 Cents ..first target $119.03....
LDK UP $2.36 on very heavy volume of 5.4million shares......Two sell side analyst were bad mouthing LDK as they were caught with their short position...Lazard & Piper repeated their sell on LDK.....
Personally I am amazed that they are pushing their sell rating still while LDK fundamentals improved big time......thier margin were expected to be 25% as per analyst consensus.... while LDK is guiding 26% to 31% for 2008 way higher than 25%.......this will push LDK EPS for 2008 to about $2.00 per share minimum...almost near STP EPS for 2008...guess where STP trades......
LDK for 2009 is almost doubling its sales with much higher margin of 42% to 50%...simple math will take LDK EPS to about $6 EPS for 2009 minimum as quick and dirty calculation....
So if we take guessed EPS of $6 per share for 2009 then LDK is trading @ PE of 8.23 forward earning 12/09...LOWEST of any Solar or Tech stock....????
LDK current price of $49.37 does NOT make any sense @ all.........
I am expecting other 3 BUY analyst to raise their target price big time for LDK in short order....
My portfolio was UP .2% and I will get more gain from my short CAD..which I will know when my account is updated in AM......
Good luck for Thursday...I am expecting it to be a "green day"......
BLOG does NOT give buy or sell.
Saleem
21 comments:
Thanks for the LDK analysis Saleem. I am still in RIMM, SOHU, BG and LDK. Thanks again. Doug...
Hi Doug,
LDK is the-stock for 2008...do not sell...until I have done some future target pricing.....which I will post.
BG was the superstar in your show today UP $5.69.....really happy for you.
Saleem
Saleem,
What do you do about stocks that will not retreat to their RSI 30 for an entry point; like VIP and PBR? What is the technical point to buy in?
Hi Stktrader,
Most strong stocks do NOT go to 30 RSI...only weak ones do.....
You have to see the RSI range for last 3 months and then figure out your buy point on strong stocks.
Saleem
tomorrow or next week will be big for LDK...!!
It does not make any sense that LDK is @ 50/- while JASO, STP and in 80s and FSLR 240/...!!
Thanks Saleem, I watched BG for weeks before I finally pulled the trigger and I was very fortunate to by it when I did. I am holding out for $130 and will probably sell then. How does that target sound to you?
I will DEFINITELY hold LDK until I hear further guidance and targets from you. Thanks again for all you do. I wouldn't have been in on LDK if it weren't for you. Doug...
Hello and thanks everyone. This truly is a great blog and board. I learn something new everyday. There are two markets right now. Despite a 200+ down day for the dow, multiple stocks (some which I own) were green on good volume today. I hope everyone has a great trading day tomorrow.
Just read this on IBD... Stuff we already know but that is always good to be reminded of...
"Once you’ve bought several toprated stocks, one or two may falter or be unproductive after a few weeks. Consider selling those and use the cash to buy additional shares of the stocks that are working best for you.
This is known as force-feeding your winners. It’s a strategy that shifts capital into a more aggressive mode, with the goal of concentrating capital into your winners. [...]
The force-feeding method requires investors to keep their hands on the wheel."
Stktrader, here is some information regarding VIP. I hope this helps. Doug...
Play Date: 01/02/2008
VIP (Vimple Communication--$43.74; +2.14; optionable): Russian wireless
http://biz.yahoo.com/p/v/vip.html
EARNINGS: Late February
STATUS: Test breakout. VIP continues to perform, breaking higher Wednesday on rising, above average volume after a nice, orderly test of the 10 day EMA (41.75) in the market selling. This test of the 10 day EMA is its second since breaking higher in early December, and that leaves plenty of upside still ahead for VIP.
Volume: 3.858M Avg Volume: 3.481M
BUY POINT: $43.95 Volume=3.4M Target=$52.95 Stop=$41.65
POSITION: VIQ DH - Apr. $40c (68 delta) &/or Stock
Good Morning Saleem, I am posting some IH buy watch alerts that may interest you or others on the board. Hope you find this useful. Doug...
Play Date: 01/02/2008
ESLR (Evergreen Solar--$17.44; +0.17; optionable): Solar power
http://biz.yahoo.com/p/e/eslr.html
EARNINGS: Late January
STATUS: Test 10 day EMA. Got a bit too antsy with ESLR Wednesday. It ended up holding the 10 day EMA on an intraday test as it made the second test of its mid-December breakout from a 5 week cup with handle base. Very nice action and looking to move in as ESLR continues its break higher.
Volume: 4.079M Avg Volume: 4.872M
BUY POINT: $17.71 Volume=5M Target=$21.75 Stop=$16.74
POSITION: QLU CW - Mar. $17.50c (58 delta) &/or Stock
New buy point on current positions:
Play Date: 01/02/2008
CF (CF Industries--$110.61; +0.55; optionable): Agriculture chemicals
http://biz.yahoo.com/p/c/cf.html
EARNINGS: Late January
STATUS: Test breakout. CF is making a low volume test of the mid-December breakout from its 5 week base. Great volume on the break higher, nice low volume on the test of the 10 day EMA (108.58) as CF uses market selling to set up its next move. Nice test and ready to see the next move higher to move into more positions.
Volume: 1.348M Avg Volume: 2.162M
BUY POINT: $112.05 Volume=3M Target=$128.95 Stop=$107.88
POSITION: CF BB - Feb. $110c (56 delta) &/or Stock
Play Date: 01/02/2008
RIMM (Research in Motion--$113.71; +0.31; optionable): Blackberries
http://biz.yahoo.com/p/r/rimm.html
EARNINGS: Announced 11-20-07
STATUS: Double bottom w/handle. RIMM continued its fade after gapping higher on earnings. It showed a doji at the 50 day SMA Wednesday, closing at that level. It has used the market fade to test the gap higher and set up the next upside break in its 7 week pattern. If it can show strong upside trade on a break higher we are looking to move in again.
Volume: 24.174M Avg Volume: 29.164M
BUY POINT: $115.32 Volume=30M Target=$136.95 Stop=$111.12
POSITION: RUL CU - Mar. $115c (55 delta) &/or Stock
Hi Doug,
Just looked @ BG chart.
$130 is a given...where it may stall to build another base....
www.stockchart.com has a P&F target of $159......which I concur where it is heading shortly.
Since you are a trader $130 is a good exit point....could come in 1 or 2 trading day.....
Plan on getting back in around $125 again.
Thanks for posting IH take on VIP for stktrader......
VIP & PBR are both good for quick daytrade.....as it is heading towards high end of RSI range...then it will go sideways to lower for few days imho.
RIMM should move UP now...as it has done a double bottom on wed...found support @ 50 DMA and closed UP.....
I may exit RIMM in this UP move...do NOT know @ what price yet...it all depends on tape....$122 is where I will pull trigger for sure...If I am so lucky !!!
As you know RIMM is my 2nd largest $ allocation.....need to see some DOUGH from my investment......
Saleem
Hi Doug,
I just read the IH alerts. Where do these come from?
Would appreciate a link to the service and also your opinion of it.
Many thanks and all the best for the coming year!
Bea
Hi Minaccess,
This BLOG is appreciated by many because we all care to SHARE our take on many many stocks...which helps traders/investors to make real time $$.
I personally like Q & A postings because it helps many...who may have the same Q.
You are a good contributor to our comments section.
SOLF announced 7 year deal for wafer supply with a Korean producer today.....stock UP in pre-market.....
RSI may get stretched after todays move UP.....FWIW
Saleem
GOOD MORNING SALEEM:
Have a great day!! I found this news on LDK . Seems like a rehash to me, but it may be news to others on your Blog!
I am still in RIMM, CHL, NYX, DSX, LDK, CSIQ. Looking at BABY and AMAZON what do you think about my stocks. Comments always appreciated. Good Luck to all
happy 2008....Madmax
Analysts are less sanguine about LDK's prospects for securing the polysilicon it needs for its solar panels at a discount to rising spot prices. The company, based in Xinyu City, China, and Sunnyvale, Calif., said on its last earnings conference call that it will buy 75% of its 2008 polysilicon supply at prices below the spot price.
In a press release, LDK estimated revenue of $960 million to $1 billion based on a projected 510 to 530 megawatts of multicrystalline solar wafer shipments in 2008, and predicted gross margins between 26% and 31% based on being able to produce 100 to 350 metric tons of polysilicon at a plant it's building in China.
In 2009, it expects to wafer shipments of 1,050 to 1,150 megawatts but the company reined in its forecast for polysilicon production to between 5,000 and 7,000 metric tons.
On Jan. 2, Jesse Pichel, an equity analyst at Piper Jaffray, upheld his sell rating on the stock, citing its high valuation and the lack of clarity around the cost of LDK's polysilicon supply and the timing of the ramp-up of its internal polysilicon production.
"LDK has not given any incremental transparency on its polysilicon plant startup," Pichel's note said. "We do not know where it will get the TCS feedstock plant design," a significant hurdle in producing its own polysilicon. (Piper Jaffray has provided investment banking services for LDK within the past 12 months and makes a market in its securities.)
Trichlorosilane gas is another major cost component without a closed-loop system that allows the TCS to be recycled.
Based on timetables for plant startups provided by a few domestic polysilicon manufacturers, Pichel questioned whether LDK would be able to produce meaningful volumes of the material until 2010, which would leave a hole in its supply needs for 2009.
If that turns out to be the case, the company's gross margin for 2009 would be less than half of its outlook of 42% to 50%, Pichel's note said. LDK may, however, have polysilicon contracts with reliable sources that haven't been announced, the note said.
Akeena's path to higher profits seems much more straightforward. Including the Andalay products, the company's revenue will nearly double this year to over $58 million from $31 million in 2007, said Yerger at Jesup. The licensing arrangement with Suntech will provide only a small boost in revenue, where the main benefit will be in the wider gross margins, he said.
Yerger estimates that Akeena will install roughly seven megawatts of Andalay panels in 2008, with another two megawatts worth to be sold through strategic distribution channels such as the Suntech deal. But the additional sales could be as much as 10 megawatts according to Suntech's estimate, he said.
While polysilicon prices continue to keep solar panels out of the price range of most consumers, technological advances that require less of the material to be used and cheaper installation options such as the Andalay technology may spur some customers to be more inclined to give solar power a chance.
And if that's not reason enough, rising oil prices may provide an extra incentive.
Bogoslaw is a reporter for BusinessWeek's Investing channel .
Hi Garrett, IH is investmenthouse.com. They pick break out stocks. They have completely changed my profit results dramatically. I use their service in my own way, but here is what they do for me: They pick stocks that are in the right sectors. They give entry points as well as exits and stop losses. They give nightly updates on each of the stocks that they are in. I tend to sell way before their target because I am more cautious to take profits when they present. The cost is about $140 per month. They also provide nightly reports on the markets as a whole. It is the only service that I would highly recommend. Best of luck. Doug.
Hi Madmax,
I like your current portfolio.
Do NOT try to have too many stocks.
If you must try to buy more of what you are comfortable with.
As you have noted my average is 5 stocks then go down to 4 only...
This way you make lot more money than trying to become a mutual fund.
Overdiversification is not very productive.
Check FA/TA & go overweight in those you feel confident....FWIW
Saleem
Hello. Looks like solar will be fun again today. SOLF up over $3 and CSIQ up 3% in pre-market. Hopefully, today we see a bottom in the market. Good luck to all.
Saleem,
I was going to make the mistake of having too many stocks. I was gunning for 5 or 6 but now it looks more like 3 or 4. Also, I must resist buying them all at once. I am just wondering how I should "split" my money between them (I was going to go 25% each stock). I saw in your ealier posts that your portfolio is not distributed evenly. Any insight for me on that matter?
Hi Frogvest,
You should divide your $ based on your expectation of each stock.
So...if you are very confident based on your FA/TA it should get say 40%..next 30% next 20% and last 10%...based on 4 stock format.
4 stocks I highly recommend...
Hope it helps.
Saleem
SALEEM:
This was such a good read on SOLAR plays that I had to post it for readers of your blog. GO SOLAR
And thank You so muchs for your review on my stocks that I own.
Wha t is you opinion of YGE??
Madmax
IBD's Energy-Other group, heavy with solar companies, currently ranks No. 1 of the 197 industry groups tracked. The 75-company group is up 70% since mid-August. Rankings are based on stocks' price performance in the last six months.
All nine of the top-rated companies in the group are solar-related, and IBD gives all of them a Relative Strength Rating of 99, the highest possible. The RS is based on price performance in the past 12 months.
"The solar sector has done extremely well," said Brion Tanous, an analyst with Merriman Curhan Ford. "It's seeing tremendous growth."
Analysts question whether the group can keep up this pace in 2008. There's much room for growth, but solar companies must continue to depend on government incentives. Old energy sources are still cheaper.
Stock prices have been volatile. It's not uncommon to see stocks in this sector surge, or fall, by 10% or more in one day.
Solar-product makers First Solar, (FSLR) SunPower (SPWR) and Suntech Power Holdings (STP) have emerged as sector heavyweights. All have U.S. market capitalizations that top $10 billion. That's more than such household names as bookseller Barnes & Noble (BKS) and battery maker Energizer Holdings. (ENR)
The high valuations have helped attract mutual funds and other institutional buyers to the solar game in the past three to six months, analysts say. Many funds only invest when companies hit market caps of $5 billion or $10 billion and daily trading volume of 1 million or more.
Besides, many solar companies are in the black and growing earnings.
Solar stocks also enjoy the unique position of being a pure-play investment for clean-energy companies in the U.S. Unlike Europe, wind energy and other green investments are harder to find on the U.S. markets. General Electric, (GE) for example, is one of the largest makers of wind turbines, but that unit makes up less than 15% of GE's total sales.
"There are more investment dollars . . . chasing clean energy," said Michael Carboy, an analyst with Signal Hill Capital. "Green energy and cleantech really is an enduring investment theme."
Photovoltaic solar products take the energy of the sun and convert it into electricity. Groups from homeowners to utilities use the technology. Solar industry sales are expected to jump to $69.3 billion in 2016 from $15.6 billion in 2006, says analyst Tanous.
The industry is scrambling to improve its technologies so that it can cut its power costs by half by early next decade. That would put it near the price of traditional electricity and free it from the need for government incentives.
In the meantime, solar demand is strong in many places, especially where incentives have been heavy, including Germany and Spain. Italy, Greece and parts of Asia also have been stoking demand.
The U.S. expansion has been led by California's aggressive solar program. Additionally, the federal government has been giving some tax credits to solar projects. The tax credits run out at the end of 2008, but Congress might extend them.
Rhone Resch, president of the Solar Energy Industries Association, says solar energy's installed capacity rose by 70% in 2007 in the U.S. He sees it rising another 50% to 80% in 2008.
"2007 was really the year of solar energy in the United States," Resch said.
Still, the prospect of government incentives beyond the near term is iffy, says Colin Rusch, an analyst at Broadpoint Securities.
"To predict the market past 18 months is very difficult," he said.
One thing is certain: The industry is facing shortages of the key material used to make solar cells, a type of silicon called polysilicon. Some analysts don't see the shortage working itself out until 2009 or later.
Polysilicon prices have risen to around $400 per kilogram from roughly $35 per kilogram earlier this decade, says Mark Bachman, an analyst at Pacific Crest Securities. He says prices should fall to less than $100 at some point.
The situation has companies working to land long-term supply contracts, analysts say. Companies with close ties to suppliers, such as JA Solar (JASO) and Yingli Green Energy Holding, (YGE) have seen big stock moves because they might be able to ramp up production faster than others.
The supply shortage has helped suppliers of the material, including investor favorite MEMC Electronic Materials. (WFR) Its stock more than doubled in 2007.
Some companies say investors should look beyond any possible supply shortages. First Solar, which saw its stock rise by more than 700% in 2007, has gained attention by avoiding the shortages. The company uses little or no silicon to make its cells.
First Solar has also managed to ramp up production faster than expected — and is finding new ways to improve the efficiency of its solar technology.
"They had a lot of things go right for them this year," Rusch said. "They were able to get efficiency gains."
Another favorite is SunPower.
It uses less polysilicon than others, according to analysts. It also boasts some of the most efficient solar cells in the industry — meaning it gets the most electricity from its solar cells.
Hi Madmax,
YGE is a buy based on chart pattern & RSI.....
Saleem
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