Please read carefully our disclaimers at the end of this newsletter. Market Stance: BULLISH (since September 6, 2005)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. Bought Ventiv Health Inc. (VTIV)
* The "Net buy price" is the total net purchase cost after commissions for all managed accounts divided by the total number of shares. Today, Tuesday, September 20, 2005, I bought VTIV, first for client accounts, then for my personal accounts. Ventiv Health, Inc. provides sales and marketing solutions for the life sciences industry. The Company's clients include pharmaceutical, biotechnology, medical device, and diagnostics companies throughout the world. Ventiv offers healthcare sales, market research, and strategic planning and educational communications services. This stock is a component of the IBD 100 Index. ("IBD" = "Investor's Business Daily") Here's why I bought this stock: + Second breakout attempt: The stock hit an all-time closing high of $26.17 on March 10. The next all-time high was $27.22 on September 12 (last Monday). That was a breakout, but then the price fell back down over the next few days. The stock briefly traded below $25 last Friday. Now it's on the rise again, and today it is poised to once again close above that March closing high. + The stock price has been rising on heavy volume days and falling on light volume days for the past couple of months. This is a bullish pattern. + Back on August 8, the stock met the stringent technical buy criteria outlined in my Research Update of June 26, 2004: http://www.deencapital.com/newslett/2004/040626.129.html#3 . The high on August 8 was $25. I'd prefer to buy at $25 or less, but other factors are sufficiently strong that I am persuaded to pay up at today's price. Valuation, after all, (see below) is still quite modest. + Excellent and accelerating recent sales growth: Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +50%, +56%, +71%, and, most recently, for the quarter ended June 30, +75% to $131.8 million. + Excellent recent earnings-per-share growth: Here are the quarterly EPS figures for the last eight quarters: Sep 04 vs Sep 03: 20c vs 12c Dec 04 vs Dec 03: 49c vs 20c Mar 05 vs Mar 04: 27c vs 20c Jun 05 vs Jun 04: 32c vs 19c + Rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2005 is $1.29, revised upward from $1.19 90 days ago (and up from 2004 actual earnings of $1.10); and the consensus estimate for 2006 is $1.49, revised upward from $1.31 90 days ago. + Valuation: At 18 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 22%, the stock is attractively priced. + History of earnings surprises: This company has reported earnings at least 4c ahead of estimates in each of the past four quarters. (Most recently, the quarter ended June 30 came in 7c ahead.) + The stock's 200-day moving average is rising, indicating a long-term uptrend. I chose to buy the stock in spite of the following negative factor: - The company's industry group ("Commercial Services - Healthcare") is ranked #68 for relative strength out of 197 industry groups tracked by Investor's Business Daily. This ranking changes daily, and it has been generally falling over recent weeks and months. -KD, September 20, 2005
* 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 © 2005 Deen Capital Management, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||