China Nepstar Chain Drugstore Ltd. (NPD)

Good morning!

It seems lately that China Nepstar Chain Drugstore Ltd. (NPD) had an anchor around its neck.  The stock has been on a persistent decline for well over a month fueled by some disappointing financial news.  It is a NYSE stock that seems intent on becoming a penny stock

NPD has been its own worst enemy posting disappointing results for the first Q on expansion costs, increased expenses and a management shakeup, etc…

BUT, this is a company that has $1.58 in cash,  great debt and liquidity ratios and has the clout of having over 2,500 stores in its Mainland China drugstore empire .

Eventually buyers get exhausted….and, that may be what has happened with NPD.

Here is the chart for NPD!

The question you have to ask yourself “Is this rally real?”.  It might be….or it might fall back.  If the stock falls back to $3.00 again and THEN climbs, popular consensus is that is when to really jump in.  That is confirmation of the trend being broken and a great buying signal.

I would watch NPD.  The stock is down now, but it won’t be forever.  I expect bigger and better things from NPD….maybe soon.

Good luck and GREAT trading,

Jeffrey Dean, Senior Editor

 
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Disclaimer

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.

RIMM, JBLU, JOSB, ISCO, HEAT, HON, ZZ, ATSG, MU, RAD

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Jos. A. Bank Clothiers Inc. (NASDAQ: JOSB) $54.72 +5.80% Jos. A. Bank Clothiers Q4 earnings, sales top estimates (NASDAQ:JOSB), ($JOSB)

International Stem Cell Corp. (OTC: ISCO) $2.26 -11.02% ISCO subsidiary signs distribution agreement with Veritas Corp. to distribute its human cell culture products throughout Japan (OTC:ISCO), ($ISCO)

SmartHeat Inc. (NASDAQ: HEAT) $10.74 -14.22% SmartHeat earnings fall short of estimates (NASDAQ:HEAT), (NASDAQ:HEAT)

Honeywell International Inc. (NYSE: HON) $45.27 +0.71% Analysts boost price targets on HON after strong Q1 guidance (NYSE:HON), ($HON)

Sealy Corp. (NYSE: ZZ) $3.49 -4.38% Piper Jaffray reiterates “Overweight” on Sealy; ups price target to $5

Air Transport Services Group Inc. (NASDAQ: ATSG) $3.34 +44.81% Air Transport Services subsidiary ABX Air has entered into a new five-year agreement with DHL (NASDAQ:ATSG), ($ATSG)

Micron Technology Inc. (NASDAQ: MU) $10.37 -3.89% Micron Technology turns a profit in Q2, helped by higher DRAM sales (NASDAQ:MU), ($MU)

Rite Aid Corp. (NYSE: RAD) $1.50 -11.24% Rite Aid shares decline on Q4 results, weak outlook (NYSE: RAD), ($RAD)

I was looking for a title for an analysis of shipping stocks and what better words than “Anchors Aweigh”.  Of course, the minute I said it, I started to sing the Navy Anthem.  My Dad served in the Navy during WWII and I will always be a Navy man.  Right now, that song is running through my head.

I picked 4 companies that, to me, represent the best in the shipping industry: SHIP, OCNF, DRYS and SINO.

Seanergy Maritime Holdings Corporation (NASDAQ:SHIP) – A company that is flying under the radar.  It is profitable, 95% of its fleet has contract coverage (meaning they are leased out under contract for all of 2010), they recently raised capital, they are retiring debt, etc…  Definitely one to put on the radar!

DryShips Inc. (NASDAQ:DRYS) - the most well known of the shipping stocks – DRYS has been trading sideways since May of 2009 in a band between $5 and $8.  That is great if you are a short-term trader.

OceanFreight Inc. (NASDAQ:OCNF) – OCNF has been a disappointing trade for most of the year.  Like DRYS it is highly volatile…which is a good thing for traders.  Their financials are a mess, but the global economic recovery might keep them “afloat”.  Definitely the “weakest link in the chain”.

Sino-Global Shipping America, Ltd. (Nasdaq:SINO) – Don’t make the same mistake I did.  SINO is not a shipping company in the sense that these other three companies are.  They actually provide shipping agency services and are firmly entrenched in some of the busiest Chinese ports.   They are highly profitable and have a rock-solid Balance Sheet.  What originally got traders fired up about the stock was that they had more cash per share than share price (before the recent run up).  Might be a good stock to keep an eye on.

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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.

In the stock screening software that I use, I can slice and dice information in seemingly millions of ways.  Today, I searched for companies that were on a prolonged downtrend of 8 days or more.  Many of the companies that I found in the inauspicious group deserved to be there.  One didn’t:  Ariad Pharmaceuticals, Inc. (ARIA)

ARIA has had an distressing TEN (10) down days in a row. I searched news for reasons for such a prolonged decline and couldn’t find any.  They had no FDA turndowns, no going concern issues, no debt restructuring that will wipe out all common stockholders….NOTHING.

All I could find was a company that had a strong balance sheet, good liquidity and some VERY promising drug candidates.   ARIA is a biotechnology company focused on developing drugs to fight cancer.  They have two drugs: Ridaforolimus and AP24534 that, according to the company, look have great potential.  The links are for my readers to read about these drugs themselves.

The main issue facing the company is financing…because of their high cash burn rate.  The company is not under any going concern cloud currently, but they are going to need more money either through an equity raise, debt or co-development funds from partners like Merck (on Ridaforolimus).  Based upon what I see and my conversations with the company, I don’t think that will be a problem.

The chart speaks volumes to me:

The stock has rallied slightly today, but after such a long decline, I wouldn’t be surprised if it roars back.  Long-term this could be a very good stock to own, but since I am not a long-term investor forget I said that.

Short-term doesn’t look bad though.  ARIA is a very well put together company, IMO.

Good luck and good trading!

As a pure chart play, NCI Building Systems Inc. (NCS) is very interesting.  I had posted a in-depth review of NCS to the site a few weeks back and think that now is the time to take another look at the company.  The company is a manufacturer of metal products for the non-residential construction industry in the U.S.   Full description:  click here

My quick review of the company is that they have good revenues, decent margins, are making a profit (on reduced sales) but had some major balance sheet problems.  The main revolves around their debt structure.  They were in default under their agreements and the latest extension was due to lapse in late November.  Did you notice that I said “had” some major balance sheet problems.  Their white knight, in this case Clayton, Dubilier and Rice (CDR), rode in and “saved the day”.    Here is what NCS got:

• $250 Million Equity Investment
• Debt reduction of $323 Million
• Exchange offer for convertible notes completed

Here is what they gave up: 68.5% of the company. Shareholders got whacked, but now NCS has “the resources to sustain future growth” according to the press release announcing the deal.  Click here to read it.

Now that the debt and liquidity issues have been resolved, where is the lift in the stock?   Let’s look at the chart and see if one might be in the offing:

• MACD is giving a bearish signal – Below the zero line
• MACD, however, looks to be turning positive and if this trend continues could cross in the near term
• Stochastics are emerging from a strong oversold position.  It appears that the stock could be under accumulation again
• Recent chart history suggests that the stock usually rallies from chart setups like its current one.

Since I typically only look at short-term price action, I am looking at NCS for a near term bounce.  The company fundamentals have improved with the recapitalization by the private equity firm, CDR….in fact, that is a huge endorsement of NCS by CDR.

Read both reports to understand NCS well and watch the chart.!

Good luck and good trading

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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.

I have a Rite Aid near my home that I have stopped in to on several occasions.  I can tell you I am in no hurry to go back. The store looks old and tired and is not laid out very well.  The store personnel didn’t seem to care that I was even there.

I don’t know if my local store is a valid indicator of the state of Rite Aid Corporation around the country, but my experience seems to be indicative of RAD’s larger problems.  Customers are staying away in droves.  Whether it is strictly the economy or other issues,

Financially, their balance sheet is still a mess. Their income statement, while showing signs of improvement (sales holding steady, operating profits the last two Q’s) still doesn’t contain lots of good news.  RAD Corporate issued a corporate update (considerably more upbeat than my quick analysis) – you can read it by clicking HERE

I did not come to kill Rite Aid as a stock or a company, but my belief is that the company is not “out of the woods” yet.

However, as a chart play, there might be a reason to look at RAD.

My chart analysis shows me that:

• The stock is sitting near a good support level
• Accum/Dist indicates that the stock may be in accumulation again
• Stochastics indicate that RAD is oversold
• Bearish MACD signal is lessening

See for yourself!

To my mind, RAD is a short-term play only.  Big profits were made in its 2009 run from 20 cents to over $2.00.  I don’t know if RAD has that kind of move again or not (I kinda doubt it), but watch for any surges.  I would never recommend buying RAD on the HOPE that it will go up, but if the chart is any indicator then there MIGHT be a bounce in it.

Good luck and good trading

Featuring RAD’s Q1 results; TJX’s $9.75M data breach settlement; XDSL’s nanobattery technology; C’s decision to boost employee salaries to offset bonuses; and SVU’s Q1 profit.

Today’s Stock Alerts include: Rite Aid Corp. (NYSE: RAD), The TJX Companies Inc. (NYSE: TJX), mPhase Technologies Inc. (OTCBB: XDSL), Citigroup Inc. (NYSE: C) and SUPERVALU Inc. (NYSE: SVU).

Rite Aid Corp. (NYSE: RAD) Stock Alert – RAD Narrows Loss, but Issues Downside Guidance for FY10

Retail drugstore chain Rite Aid Corp. (NYSE: RAD) today announced its first-quarter results, posting a loss of $98.4, or 11 cents a share, for its fiscal first quarter ended May 30, 2009, its eighth consecutive quarterly loss. However, thanks to recent store closures and cost cuts, the company’s loss came in smaller than expected. continue

Today’s Stock Alerts include: Pall Corp. (NYSE: PLL), Texas Instruments Inc. (NYSE: TXN), Mattel Inc. (NYSE: MAT), Seagate Technology Inc. (NASDAQ: STX), Rite Aid Corp. (NYSE: RAD) and Palm Inc. (NASDAQ: PALM).

Pall Corp. (NYSE: PLL) Stock Alert – Pall Corporation Secures Water Filtration Project in Philippines, the Largest in Philippines Ever

Pall Corp (NYSE: PLL) shares slipped .19% this morning, trading at $26.55. The global leader in water filtration and purification systems recently announced it has been awarded a $14.7 million contract to design and install a Pall Aria (TM) microfiltration/reverse osmosis membrane water treatment in the Philippines capital of Manila.  The Manila project represents the largest filtration project ever undertaken in the Philippines, and establishes the East Hills, NY-based Pall as the leading filtration company in Southeast Asia, said Pall in a news release.

One of the two privatized water suppliers in Manila Metro area, Maynilad Water Services Inc., awarded the contract aimed at servicing an area population of 8 million to 9 million people in parts of Cavite province and western Metro Manila. continue

Wall Street slipped after an early-morning advance, driving stocks down; TNL surged 6%.

Google Inc. (Nasdaq: GOOG) Stock Alert – Acer Offers ‘Netbook’ Buyers Google’s Android

Google Inc. (Nasdaq: GOOG) shares slipped .43% to $426.89 in today’s early trading. The Associated Press reported “netbook” computers made by Acer Inc. will now offer Google’s new operating system, Android, as well as Microsoft’s Windows, giving buyers of DOS machines a choice of operating systems outside of the Windows/Linux hold.

Android’s break into the operating system market is greatly boosted by the decision of the world’s third-largest PC maker to promote the clear choice between Google and Microsoft.

Android is already freely distributed by Google for mobile phones, giving sellers and consumers a cheaper alternative to Windows, Acer executive Jim Wong said at the Computex computer show in Taiwan.  Wong also cited Android’s fast boot-up time as a positive feature. continue