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Please read carefully our disclaimers at the end of this newsletter. Market Stance: BEARISH (since April 27, 2010) Contents
Typical Client 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.
* Buy prices shown are net after commissions and fees. Today, Thursday, June 17, 2010, I bought IGTE, for both client and my personal accounts. iGATE Corp. works with client companies to optimize their businesses, secure year-on-year cost benefits, and tie costs to business needs and results. Their iTOPS model (integrated Technology and Operations) assures clients of year-on-year savings by process and technology optimization, access to proprietary tools, and migration to enhanced processes. Here's why I bought this stock: + Recent breakout: Last Friday, June 11, the stock was up 7.5%, closing at $13.52, on almost 4 times average daily volume. This was a marginal breakout from a seven-week trading range to a new 9-year high. We are buying today just slightly above this price. + Turnaround in recent sales growth. Here are the quarterly year-to-year sales growth rates from the last four quarters, in chronological order: -17%, -11%, +2%, and, most recently, for the quarter ended March 31, +29% to $57.9 million. + Turnaround in recent earnings-per-share growth. Here are the quarterly EPS figures for the last eight quarters:
Jun 09 vs Jun 08: 11c vs 13c Sep 09 vs Sep 08: 16c vs 15c Dec 09 vs Dec 08: 15c vs 12c Mar 10 vs Mar 09: 18c vs 9c + Strong and rising earnings-per-share estimates: According to recent data from First Call, the consensus earnings estimate for 2010 is 77c, revised upward from 68c 90 days ago (and up from 2009 actual earnings of 51c); and the consensus estimate for 2011 is 88c, revised upward from 79c 90 days ago. + Valuation: At 16 times next year's estimated earnings and a projected 5-year annualized earnings growth rate of 20%, the stock is still, even after recent gains, attractively priced. + History of earnings surprises: This company has reported earnings-per-share at least 2c above estimates in three of the past four quarters. Most recently, for the quarter ended March 31, they "beat the Street" by 4c. + The company's industry group ("Computer - Tech Services") is ranked #77 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, June 17, 2010
* Buy prices shown are net after commissions. ** 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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