Please read carefully our disclaimers at the end of this newsletter. Market Stance: BULLISH (since August 18, 2004) Contents
Year-To-Date Performance
* An average of managed accounts, net after commissions and fees. Individual account results may vary. See also www.deencapital.com/perform.htm. For information on managed accounts, see www.deencapital.com/mgdaccts.htm.
* The "Net buy price" is the total net purchase cost after commissions for all managed accounts divided by the total number of shares. Today, Wednesday, November 24, 2004, I bought SIFY, first for client accounts, then for my personal accounts. Sify Limited is an Internet, network and electronic commerce services company in India. They deliver services and solutions over a common Internet backbone infrastructure. Here's why I bought this stock: + News: Yesterday, Tue Nov 23 before the open, the company announced a partnership with Global Crossing. Effective October 18, Global Crossing IP VPN customers gained access to 63 major commercial centers in India, while Sify gained worldwide service reach to more than 50 countries and 500 major cities. + A "true surprise"*: Prior to the news, the stock was bouncing around within a 2-month trading range of $5.28 to $6.41. Then, yesterday, the stock soared on very heavy volume. * "True surprise" is my term to describe a company news item that ignites heavy buying and that was not preceded by a short-term run-up in the stock price (i.e. not preceded by rumor). + Yesterday's jump in price was a breakout to a 5-month high. + Excellent recent sales growth: Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +57%, +51%, +44%, and, most recently, for the quarter ended Mar 31, +49% to $19.1 million. + Recent emergence into profitability: Here are the quarterly EPS figures for the last eight quarters: Jun 03 vs Jun 02: (13c) vs (37c) Sep 03 vs Sep 02: (5c) vs (39c) Dec 03 vs Dec 02: (6c) vs (27c) Mar 04 vs Mar 03: 2c vs (9c) + Strong, though falling, estimates: According to recent data from First Call, the consensus earnings estimate for FY 05 (Mar) is 9c, down from 10c 90 days ago; and the consensus estimate for FY 06 is 25c, down from 26c 90 days ago. I consider this a positive in spite of falling estimates, because that's still a 178% jump in projected earnings from this year to next. + Valuation: At 28 times next year's estimated earnings, the stock is moderately priced. + The company's industry group ("Internet - ISP") has risen sharply in relative strength over recent weeks and months, according to data from Investor's Business Daily. It now ranks #85 out of 197 groups. (No earnings-surprise history data was available.) -KD, November 24, 2004
* Net buy prices shown are the total net purchase cost after commissions for all managed accounts divided by the total number of shares. ** Current prices are at least 20 minutes old. Welcome to The Deen's ListTM, an e-mail stock newsletter from Deen Capital Management, Inc. My intention is to inform you as quickly as is practical regarding my stock market moves. When I buy or sell a stock, first I take care of client accounts, then I buy/sell for my personal account(s), and then, third, I send out this newsletter. Your feedback is welcome. Send e-mail to deenslist@deencapital.com. To subscribe or unsubscribe, include the word "subscribe" or "unsubscribe" in the Subject line. This newsletter is free to managed account clients. For a limited time, it is also free to all interested parties. Your personal information, including your e-mail address, will be held in strict confidence by Deen Capital Management, Inc. We will not share it with or sell it to others. All stocks discussed in The Deen's ListTM involve a high degree of risk. It should not be assumed that any stock discussed in The Deen's ListTM or purchased by Deen Capital Management, Inc. will be profitable. Past performance is not necessarily indicative of future results. The information contained herein has been compiled from sources deemed to be reliable; however, we are not responsible for its accuracy or completeness.
Ken Deen Copyright © 2004 Deen Capital Management, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||