General Commentary

Pacific Ethanol, Inc. (PEIX) has been one of my most popular research reports for 2010.  I have the software that allows me to track clicks and time spent reading the info and PEIX has been very popular.  And, I can see why.

PEIX has made two major “stair steps” in their chart on their way from 40 cents to a 52-week high of $2.75.  Now, the stock is trading around $2.00 which seems to be a good support level for it.  It is perched on the 50-day MA which could give support to the “next leg up”.  The question is “will PEIX make the next leg up?”

My annotated chart makes a good case for some short term gains:

PEIX has coped very well through all of its troubles over the past few years.   PEIX seemed to be the poster child for the problems with the ethanol industry.   In early 2009, the bankruptcy of its operating subsidiaries was a desperation move for a company that was in deep trouble.  Here is a link to a Chapter 11 summary.

The ethanol industry crawled off its death bed with the news that the U.S. EPA made positive comments relating to a reports regarding E15 gasoline, which if approved, would boost the legal percentage of ethanol in gasoline by 50%.   The resumption of operations at several of its plants was news that the market approved of.  A drop in corn prices, increases in the price of oil and an easing of the ethanol oversupply all contributed to a positive sentiment in the minds of investors.

Of course, any bad news will drop a hammer on PEIX.  I think that it is a little fragile given the history of the ethanol business.  The shorts are around 10% of the float, so there is a constituency is hoping that the hammer falls.   It may fall long-term, but I am not a long-term investor.

The chart, to me, looks good for a little “pop”.  Any break below the support that I charted and the stock should be avoided.

Trade like you mean it!

Jeffrey Dean

Editor

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Investor Soup

DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

StemCells, Inc. (STEM) has been the poster child for the stem cell industry since late 2008.  It has made many people rich speculating on the ups and downs of this particular stock.  With its ticker symbol that seems to represent the entire industry, investors and traders have made this a very popular stock.

Their is an old saying that says “when the media sneezes, the whole world catches cold”.  That has certainly been a huge factor in the rise (and fall) of STEM and other stem cell stocks.  Stem cell hysteria has hit several times over the past few months with investor interest being peaked by media hype.

Here is a description of the company from Yahoo! Finance:  StemCells, Inc., a clinical-stage biotechnology company, focuses on the research, development, and commercialization of products derived from stem cell technologies. It focuses on developing cell-based therapeutics to treat diseases of the central nervous system and liver.

Most stem cell companies that I have seen are very far away from making their particular take on the propagation or use of stem cells profitable.  STEM is no different.  It does have some revenues, but expenses far outweigh revenues.  The good news for STEM is that management has used all of this hype and interest in stem cell stock pay dividends in the form of equity raises and fundraising.  STEM has an impressive cache of cash (over $28MM as of 9-30–09), but at a $7MM quarterly burn rate that cash will last them a year.  STEM will probably never seen penny stock land again and I could see it upgrading its listing in the future.

Chart analysis:

STEM has an interesting chart that bears watching.  See my annotations below.

The stock appears to be basing at this level and performance of this stock could depend solely on what news comes out regarding stem cells in the next few weeks.

For those traders who want to be ready for the next stem cell explosion, here are some tickers that you should hold on to:

ACTC  * ALXN * AOLS * ARIA * ASTM * BHRT * BMSN * BTIM * CBAI * CCEL * CELG * CRIS * CUR * DNDN * GERN * IART * INCR * ISCO * KOOL * MCET * MEDS * OCHT * OSTE * OSIR * PKI * PPMD * PSTI * SPPI * STEM * VODG

I have previously blogged ACTC, ARIA, CBAI, PSTI and now STEM.

There is a strong short sentiment about STEM with the latest Yahoo! stats showing a short percentage of 15.6% as of 2-12-10

In my opinion, STEM has a nice setup.  Any strength in the stock and the short squeeze will only accelerate the gains.  The stock should be avoided on any break below the current support of $1.16

Good luck and good trading,

Jeffrey Dean

Editor

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

One of the places that I find stocks to blog about is on Google Finance.  On the first page is a listing of the stocks that are “in the news”.  These are the stocks that are getting the most searches or maybe are a leader in volume, price change or some other measure.  One penny stock that caught my eye was:

Newport Digital Technologies, Inc.  (NPDT)

NPDT, for the purposes of this blog, is primarily a chart play.  The company has yet to generate revenues, but from the PR’s it sure sounds like they are the  next Microsoft (jk).   They are a technology company allied with incubators in Taiwan and are creating products to match their competencies in WIMAX, RFID, Digital Signage, VOIP  and Security and Surveillance.  The technology is very interesting and has the potential to be HUGE.  Personally, I would like to see more PR’s touting sales, sales commitments, contracts, etc….

But, as a chart play, it might make sense.

I actually like the technology behind what NPDT is offering.  It recently announced that A WIMAX/RFID Alpha site is being brought online with a medical complex in Newport Beach, CA.  I will watch with interest to see how that goes and if it can be a springboard to other projects.  In the RFID arena, their goal is to replace bar codes and bar coding.

Here are some sites for your own due diligence:

Yahoo! Finance link

Company website

Good luck and good trading,

Jeffrey Dean

Editor-in-Chief

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

That will come crashing to earth soon!

MedCareers Group, Inc. (MCGI) has been a great story to watch over the past few days.  Lots of PR and a frothy stock price and some very impressive gains.  The question for me is it real and will it last?

It appears that it only became active recently after changing its name from RX Scripted, Inc. in early 2010.

They must have been saving up press releases because they have flooded the airwaves with several in rapid succession.  With the purchase of medcareers.com, they became Med Careers, Inc.  That book of business has been enhanced with the announcement of the purchase of two additional companies: Staff MD and workabroad.com.

It appears that they are in the online medical staffing business based upon the PR’s I’ve read.  The website gives some amorphous description of the business they are in. …that doesn’t really match their recent PR’s.

As you can tell, I am highly skeptical of their business. It seems like it is a phenomenon of some good PR and the expectation that this company is going to be a “player”.  The challenging thing is to put some kind of revenue and profits numbers to all this PR.  MCGI isn’t telling us, so I am assuming that the company is more sizzle than steak.

For as fuzzy as I think their website is, you can’t argue with this chart:

Note:  The issue is so new that my old charting standby, Stockcharts.com, hasn’t even listed MCGI in its database

Will this stock be a penny stock before it is a $5 stock?  I think so.

The Stochastics are very overbought, but until we get more trading history it is almost impossible to point to that indicator to say that it is going to fall.  What can they follow this hype up with?  Eventually traders will become numb to news about MCGI. Financial transparency, real revenues and profits will keep this stock afloat.  When the good news runs out, so will MCGI.

Good luck and good trading,

Jeffrey Dean

Editor

Oh, by the way:  The answer to the question I posed above (The question for me is it real and will it last?) is NO and NO!

You would have to live on the moon not to see and be impressed by Zanett, Inc. (ZANE)

A $0.31 cent stock YESTERDAY, ZANE issued some great news about landing a huge number of new contracts (Read it here) and it took off.  It reached a HIGH of $2.50 before closing at $2.09. That is impressive by any measure.

The caution here is this is a company whose average daily volume was 16K shares and it has traded 7.9MM shares today!…on a public float of only 3.3MM shares.

Here is the chart:

Wow and Wow! This ship will crash to Earth at some point, but not yet.  Anybody doing a Tim Sykes and shorting the stock today is in a world of hurt.  Watch the trailing indicators (MACD, RSI and Stochastics) to see when the right time to short is.  Be careful, this could be a multi-day runner.  The first day of something THIS BIG with real news and HUGE investor interest could mean that this hangs around here…or even advances.

ZANE has made some people fortunes today.  Let’s see if we can make a fortune on the way down, too.

Good luck and good trading,

Jeffrey Dean

Editor

Cord Blood America was one of my best picks for 2009 (not my best, but close).  I had correctly called its September move (as the chart below will indicate).  I think that it might be time to take another look at Cord Blood America, Inc. (CBAI). Here is a link to my earlier blog.

Truthfully, it has been flogged unmercifully in the penny stock press.  It has been hailed as everything from the next Genentech to the next Spongetech.  I think the truth is somewhere in the middle.

CBAI is a stock built on hype.  It really hasn’t proven that its business model can actually work.  My wife and I have 4 kids and after each birth we were given the opportunity to harvest cord blood.  We declined each time…too expensive, the value to our children wasn’t clear in our mind, logistics of storing and accessing it….a whole host of reasons.

Having said all this, I think that CBAI might actually make it….at least long enough for traders to make some money. I have been reading the press releases and the company is taking great pains to both dazzle and teach.  Glitzy Las Vegas-style openings are contrasted with PR’s that tell of debt extinguishments, agreements signed, alliances gained, etc…  The truth is that CBAI lives a hand-to-mouth existence.  It has little or no cash and negative cash flow.  Debt is less of a problem than it was in ‘09 with some debt being retired, but they are not “out of the woods”.

I think the chart is positive and if CBAI can catch fire, I would expect to see some strong gains.

Here is the chart

CBAI seems to be consolidating at this level (as my chart indicates).    Any break below the current price of $.009 and the stock should be avoided.  I don’t believe that it will weaken, but, then again, my crystal ball is in the shop.

Good luck and good trading,

Jeffrey Dean

Editor

Sirius XM Radio (SIRI) has made an almost miraculous comeback from irrelevancy (and penny stock land) over the past few months.  SIRI has seen its stock rise from the low $.50’s at the end of 2009 to a recent high of around $1.15 just a few days ago.  This was very good news for the company.  Since it was facing a NASDAQ delisting and with the stock trading above the magic $1.00 mark for a period of time, SIRI was thinking it was “scot-free”.  Think again.

Last week’s drop (and this week’s continuing drop) was not surprising given the overheated condition of the stock from all indicators.  It is not clear what effect short sellers had in the decline since the short squeeze had been on for many months with the advance of the stock price.  SIRI fought through all of those challenges….that is until now.

SIRI has one more chance to regain compliance with NASDAQ regs if it can trade above $1.00 for 10 consecutive days before the March 15th date imposed by the exchange.  I don’t see that happening.  The reverse split that has been discussed seems the only option now despite management’s contention that they will be able to get a variance on appeal.  NOT BLOODY LIKELY.

SIRI should have executed the reverse split when they were so strong late last year.  The market was really pumped on SIRI and its progress.  Institutions were buying and retail investors were very happy with the run-up.  Now with a delisting notice sure to come, short sellers will be circling SIRI like sharks looking for blood.  I think the short term outlook for SIRI is definitely bearish.

Here is a chart that shows what I mean.

Is SIRI a dead dog?  Will shorters drive this one right back down to 50 cents (or lower) again.  I don’t think so.  SIRI is in a “stew of its own making”, but I think will be a good stock to buy on dips.  Right now, I would hold off (unless you are shorting the stock).  The boards and investor sentiment are telling me that this one has farther to fall.  Retail investors might not like it when they do the reverse stock split, but IMO it is inevitable.

Do your own due diligence.  It continues to be a hot topic on the boards that I monitor and it is fun to read what people write.  Make up your own mind.

Good luck and good trading,

Jeffrey Dean

Editor-in-Chief

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

First a personal update:  Friday’s blog was kind of “doom and gloom” when I was stuck in the middle of a power outage (second year in a row for NH).  Even thought I got power back relatively quickly, I am still shopping online for an emergency generator.  Family is fine, house is safe and my section of NH is no longer a third-world country.  It is amazing how we take important things (like power) for granted.

Now…on to stocks.

My scans today produced NightHawk Radiology Holdings, Inc. (NHWK). Nighthawk is at the end of a prolonged decline in its stock price IMO.  This might be a good time to put it on the radar.  If it recovers from its February swoon and embarks on a climb like last year, you will like me very, very much.

Here is what I am talking about (1 yr. chart for NHWK)

NHWK is actually a very impressive company.  They have a dominant market position in their industry.  They provide services to radiology groups and hospitals throughout the United States.  NHWK provides a complete suite of solutions to doctors and hospitals, including professional services, business services, and its advanced, proprietary clinical workflow technology.  The company claims to provide round-the-clock services for for approximately 1,560 sites or 27% of all hospitals in the United States.   That is pretty impressive!

What is also impressive is that they make money.  Revenues of $162 million in ‘09, but a loss in 2009 due to a $68.7MM  goodwill impairment charge (so, I wouldn’t hold it against them).  L-T debt of $77MM, but great liquidity ratios.  Plenty of cash in the bank ($32.29MM) and over $1.37 in cash per share.

Here is the 3 month chart so traders can see in greater detail what is going on.

Here is my final analysis.  The table below is a chart of NHWK’s highs and lows during the last year.  Lots of volatility and nice bounces off lows to post highs again.  A trader could make a great profit of trading these swings.

Do you see why I say that this is a great radar stock?

I will be watching it myself.

Good luck and good trading,

Jeffrey Dean

Editor

I am sitting in Panera working on my computer because my home is in the dark.   My part of New Hampshire got hammered by a wind and rain storm of epic proportions last night.  I spent a fun evening bailing out my basement and was winning the battle until I lost power (Wet/Dry Vacs don’t work without power).

At 11:45 p.m., I finally gave up.  My kids were sleeping snug in their beds and I just threw another blanket on them and went to bed myself.

When I woke up this morning, my property looked like a war zone.  Branches were strewn everywhere and a number of trees were down.  The wind was so intense it  even tore parts of my siding off.  It even tore the caps off of the railings on my front porch.

The good news in all this is that my family is safe.  We will get power back and life will return to normal.  Or, maybe not.

I am very concerned about the world that I live in.  I feel that American society and world society is balanced on a knife’s edge.  Economic forces beyond my understanding control my life.  If another AIG, ENRON, Merrill Lynch, etc. hits the skids what will happen too my world?  I make a very good living in the stock market.  What happened if this depression deepens and is extended.  What if there is a financial meltdown?  I am too far down the financial totem pole for anyone in Washington, D.C. to care.

Last year, New Hampshire was hit by an record ice storm.  We lost power for 5 days then and  our house temperatures inside were below freezing.  I was not prepared for this disaster, but kind friends took us in and we made it through o.k.  But, for several days last year, large parts of NH was a “third world country”.

I have started researching subsistence living since  I am responsible for my family.  I have 4 wonderful kids and a beautiful wife.  They need me to have the answers to questions that are not comfortable to ask.  Can I care for my family if some cataclysm hits? (natural or man made)  What happens if we have a Haiti-type disaster.  Total anarchy had sprung up in that country by the third day after the quake.  Why should the U.S. be any different?

As you can tell, my head is spinning.  I will follow up on this…count on it!

God Bless,

Jeffrey Dean

American Sierra Gold Corporation (AMNP) was all over the boards just a few months back.  An exciting new issue with two strong gold properties in Nevada and Mexico, it seemed to have no limits as to how far it could go.  However, like all promoted stocks the promotion eventually stopped, traders took profits and the stock “came back to earth”.

AMNP is at an interesting place right now.  The stock chart seems to indicate that the stock has stabilized from looking at the MACD, RSI and its price action recently.  Having said that, it made a similar base at around 47 cents in late January, but then pushed through that to now trade around 38 cents.  Is this the bottom?…I hope so!

Let’s take a look at why AMNP captured traders’ imaginations in ‘09. AMNP has two projects that seem to have great potential.  Its Urique project in the Sierra Madre Mountains of Mexico is their home run.  It is contiguous to NYSE listed company Gold Corp’s (GG) El Sauzal mine which is very profitable.  To the end of 2008, that mine had produced 1,072,000 ounces of gold and Goldcorp has reported proven and probable reserves of 470,000 ounces left on the property.  the Urique Project, encompassing 71,334 acres, has the potential to be as prolific as the El Sauzal mine according to the company.  However, the earliest revenue from that mine is expected to be 2012.

Its Discovery Day project in Nevada is small in comparison to the Urique project, but is projected to be revenue generating much, much sooner.  In fact, estimates I have read claim that the mine will produce significant revenues for AMNP by the end of the 2010 fiscal year (7-31-10).  Recent press releases touted the fact that the mine has been reopened and they are working towards production in the near term.

AMNP has what every mining and exploration company needs: Financing. The company announced, with great fanfare, an equity-based financing agreement with Tobermory Holding Ltd., a European institutional investor.  According to the latest Q available, AMNP has made two draws against that agreement totalling $800,000.  The initial commitment is for $6MM with up to an additional $10.5MM of financing available.  Of course, AMNP must hit certain milestones, but the fact that they have the financing is huge.  I will read their latest Q (whenever it is issued) to see just how the company is progressing.

AMNP’s Chart…with my annotations

AMNP has got some real potential IMO.  However….remember that for every surge in price, traders who are stuck in  losing position will sell into any strength.  There are a lot of angry traders out there….from reading the boards.  If the company decides to promote their stock again, that could make this thing fly.  Don’t forget to factor in the price of gold into your equation.  Now that the hype and hysteria have died down, AMNP actually looks like a good company with some exciting prospects.

Good luck and good trading,

Jeffrey Dean

Editor-in-Chief

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DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither InvestorSoup.com nor its affiliates have a beneficial interest in the mentioned company; AMNP was previously subject to a now terminated promotion agreement. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.