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Please read carefully our disclaimers at the end of this newsletter. Market Stance: BULLISH (since July 17, 2008) Contents
Performance
* An average of managed accounts, net after all commissions and fees. Click here for more performance data. Click here for information on managed accounts. Bought VisionChina Media Inc. (VISN)
* Buy prices shown are net after commissions and fees. Today, Thursday, August 21, 2008, I bought VISN, first for client accounts, then for my personal accounts. VisionChina Media Inc delivers content and advertising on mass transportation systems in China. number of displays. This stock is a component of the IBD New America Index. ("IBD" = "Investor's Business Daily") Here's why I bought this stock: + Technical: After a huge price/volume spike on July 25, fueled by an earnings surprise, the stock has been trading generally lower. However, the three heaviest volume days from July 25 to now have been up days. One of these was August 15, when the stock was up 12% on 3.5 times average volume. This came one day after the stock closed at a post-July-25 low of $17.29. It is my suspicion that August 15 marks a turning point, a resumption of the stock's long-term uptrend. If I'm correct about that, then today is an excellent entry point. We are buying at a price still within the intraday range of August 15. + Explosive recent sales growth. Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: +995%, +495%, +304%, and, most recently, for the quarter ended June 30, +333% to $20.3 million. + Excellent recent earnings-per-share growth. Here are the quarterly EPS figures for the last eight quarters:
Sep 07 vs Sep 06: 5c vs (2c) Dec 07 vs Dec 06: 8c vs (3c) Mar 08 vs Mar 07: 8c vs (1c) Jun 08 vs Jun 07: 12c vs 1c + Strong and rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2008 is 63c, revised upward from 58c 90 days ago (and up from 2007 actual earnings of 14c); and the consensus estimate for 2009 is 93c, revised upward from 80c 90 days ago. + Valuation: At 21 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 45%, the stock is attractively priced. + History of earnings surprises: This company has reported earnings-per-share at least 2c above estimates in each of the past three quarters. Most recently, for the quarter ended June 30, they "beat the Street" by 3c. + The company's industry group ("Comml Svcs - Advertising") is ranked #171 for relative strength out of 197 industry groups tracked by Investor's Business Daily. This ranking changes daily, and it has been generally rising over recent weeks and months. + The stock's 200-day moving average is rising, indicating a long-term uptrend. -KD, Thursday, August 21, 2008 Model Portfolio
* Buy prices shown are net after commissions and fees. ** 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.
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