I must apologize first for not blogging on Monday and Tuesday, but I was on a ski trip with the family and not thinking about the markets.  My alert for Monday (BLGW) is doing very well I’m happy to report.

I jumped back in to my research this morning and came across a great company that has solid prospects:  Cytomedix, Inc., a leading developer of biologically active regenerative therapies for wound care, inflammation and angiogenesis:physiological process involving the growth of new blood vessels from pre-existing vessels).

GTF’s AutoloGel System utilizes a unique technology that enables rapid isolation and activation of platelet rich plasma (PRP) from a patient’s own blood. The PRP is subsequently processed to produce a gel for application to the wound bed, re-establishing a balance needed for natural healing to occur. AutoloGel contains growth factors, cytokines and chemokines that are essential for normal wound healing. The AutoloGel System is used at the point-of care and is the only PRP System indicated for use in exuding wounds such as leg ulcers, pressure ulcers, diabetic ulcers and for the management of mechanically or surgically-debrided wounds.  The AutoloGel System is the only PRP system that is FDA cleared for the care of wounds.

The company is generating revenues and those revenues are increasing significantly.  They have cash-in-the-bank and NO long term debt….always a positive sign for me.  With the 2009 capital raise, that bought the company some time to execute on their plan.  Based upon what I have seen, they have high expectations for their AutoloGel System.

The chart indicates that the stock is trading near the bottom of its most recent trading range.

• After a steep selloff, the stock might be ready to run again
• An Amex stock, GTF is trading at attractive levels
• The strongest support is at 40 cents (see the chart)…. I don’t think it will drop that far, but it could
  

I am recommending that traders put GTF on their radar screens.  I think the downside risk is low, but the upside is strong.

As always, do your own due diligence.

Good luck and good trading,

Jeffrey Dean

Editor

I have known about Adaptec, Inc. for many years…even traded it once or twice.  It has mostly fallen off of my radar screen lately because it really hasn’t been that attractive.  I was doing screens on Stock Fetcher this morning and I was amazed to see that ADPT was on my screen for stocks that are down 8 days or more.  That speaks opportunity to me, but not in the way I normally speak about stocks.

Adaptec, Inc. provides hardware and software data center solutions globally.  Founded in 1981, it may not be around very much longer.

If you were going to put a company in your “back pocket” for awhile, this might be the one.  I am typically a short-term holder and after the most recent market meltdown, I am going to stick to that philosophy.  A long term trade to me is a month.  But, it might be a good strategy to put some Adaptec shares away in an account that is long-term.

Why?  Because of several simple reasons:

1. The company is for sale.  In December of ‘09, ADPT announced the engagement of Blackstone Advisory Partners to ” assist in the sale of the company’s assets and operations”;
2. The company is currently trading at less than its net cash position
3. The company is trading for less than tangible book value

At $3.16 in cash at the latest Q, ADPT is clearly a “free stock”.  It is unclear what premium its operations and assets will command, but I don’t think I am going out on a limb by saying that ADPT will sell for more than cash.

Here is a chart that tells the tale of the once-mighty ADPT:

• Sellers are dominating clearly…very few up days over the past two months
• The MACD is strongly bearish, but the histogram indicates that the strength of the signal might be waning
• The stochastics are oversold (no surprise there)

Here is ADPT’s website so you can do your own due diligence.

ADPT may have some bounce in the near term, especially if the stochastics continue to show an oversold signal.  However, the pay day for traders in ADPT will be the sale.  I am very curious about how the company is valuing itself.

Good luck and good trading,

Jeffrey Dean

Editor-in-Chief

P.S. - I am working out of the home today and I got one of those special stories that every work-at-home parent dreams of.  My absolutely adorable 4-yr. old Daughter, Teagan, needed to be in my lap while I wrote this blog.  Needless to say, I wasn’t very efficient.  Who cares?  I am reminded how blessed I am…by her and her three siblings.

Here is a picture so you can see just how blessed I am.

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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.

Investor Soup experienced a “phenomenon” the other day.

I did a research report on Washington Mutual (WAMUQ) and posted it to my trade alert section.  Link to my research report.  The response was overwhelming!  I have had literally thousands of unique users follow that link and view it on my site.

That report was a straight forward research report, but I recieved a number of emails asking for my OPINION of the stock.  Well, here you go…

First off, I must repeat the warning that is posted at the beginning of the research report:

Washington Mutual Inc. is in bankruptcy. Investors should be cautious in buying common stock of companies in bankruptcy. It is extremely risky and is likely to lead to financial loss.

Any questions?  No?  Good. It is clear that WAMUQ is not out of the woods, yet.  I find it interesting that a penny stock has a market cap of $354 Million and its branches still number in the thousands.  But WAMUQ’s problems may be much bigger than their branch network.

A particularly harrowing article I read on Seeking Alpha quoted the ongoing legal battles between debtors and WAMUQ and stated that “In their motion to disband, the debtor’s counsel revealed – for the first time – that WaMu’s debts could surpass $50 billion making hopes of any recovery for the equity, “extremely remote.””

There you have it….Equity holders have NO chance with this one.  And, I believe it.  Does that mean that WAMUQ should be avoided?  Not at all, but do not make the mistake of thinking that WAMUQ might be a good position for your IRA.

The chart is telling me several things that nimble traders will want to look at.  I have laid out those items on the annotated chart below:

With WAMUQ, it pays to keep an eye on the chart and on the news.  WAMUQ has been a great trader and could conceivably turn (and turn quickly), so watch the chart.  Look for confirmation that the trend is reversing.  The candles are indicating that buyers are still interested in the stock because it has not been closing at the low of the day.  However, the trend is clearly bearish.

The other thing to watch is news.  WAMUQ has a blizzard of lawsuits, injunctions, and motions between itself and the Fed, FDIC, Goldman Sachs, Regulators, etc…  The Government could pull the plog on WAMUQ at any time.

Lastly, WAMUQ is a sad story.  A proud, venerable institution that traces its origins back to 1889, it fell victim to the its own poor banking practices and the financial tsunami that wiped out so many banks.  WAMUQ is gone for good….what is going on now are just the death throes.

Good luck and good trading,

Jeffrey Dean, Editor-in-Chief

Friday’s biggest price decliner on the NASDAQ was Yucheng Technologies Limited (YTEC). The only PR I could find was that the stock got downgraded from Market outperform to Market perform by Avondale, a research firm.  The stock was trading for under $7.00 on Thursday at close.  Friday saw a massive selloff and is now trading for roughly half that.

A typical market overreaction?  Maybe, but I thing that YTEC won’t be down too long.

Yucheng Technologies Limited (YTEC) describes itself as the “Leading IT Solutions Provider for the Chinese Financial Services Industry”.    Essentially, the company provides information technology (IT), software, solutions, and services to the banking sector in the People’s Republic of China

Here is what I was able to glean from the financials (9-30-09 Q)

• $1.18 in cash per share
• No long-term debt
• Strong cash position
• Great ratios
• Profitable Operations

True, the rampant growth of the company has slowed, but it is still a very strong company.  Traders and investors seem to be punishing the company for its dismal earnings report for 2009 and a less ambitious outlook for 2010.

Here is an annotated chart to demonstrate just how steep the drop was.

Of note: The stock dropped hard on Friday, but it gapped up at open today by 7 cents.  It appears that others suddenly saw YTEC as a bargain and bid the stock up.

Interesting stock to watch and now it is priced much more attractively for traders.  Will YTEC recover and close the bearish gap?  I am watching it with interest myself to see.

Be careful not to “catch the falling knife”.  My gut is telling me that the knife has stopped falling.  However, it may limp slightly downhill or sideways for awhile before it re-establishes a bullish trajectory.

The faint of heart need not apply.

Good luck and good trading

Jeffrey Dean

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China did not have a good week last week.  The overall market stunk and China really got hammered.  One of those stocks getting hammered was GC China Turbine Corporation (GCHT).

However, GCHT didn’t stay hammered.  It rallied strongly the last two days of last week, but it still at an attractive entry point (IMO).

GCHT is a licensee and manufacturer of a proprietary two-bladed wind turbine.  Their initial product is a 1 MW turbine that has been a “hot-seller” for the company (according to the company that is).  It is much different that last week’s wind power blog topic, Helix Wind (HLXW).  GCHT is doing utility grade turbines that are being purchased by utilities and regional governments in China.

What is exciting about GCHT is not contained in its historical financials….it is in their press releases. The company didn’t deliver its first turbine until the 4th Q of 2009, but they are on an accelerated pace.  They are estimating revenues and profits of $19.6 MM and $1.5MM respectively.  That is after ZERO revenues the previous 3 Q’s.  The release (read it HERE) goes on to state GCHT is forecasting initial orders of 160 wind turbines, worth in excess of US$135 million and a 2010 revenue forecast of $87MM. The release went on to state that the product line will expand with the addition of $2.5MW and 3.0MW wind turbines.

Here is the chart so you can see what I am talking about:

GCHT is at a crucial juncture…If it can penetrate resistance at around $2.90 and hold above there, I could see it running and retesting the 52-week high of $4.07.  The news is certainly positive for the company and it appears to be heading in the right direction.

Good luck and good trading,

Jeffrey Dean

I was tempted to have a title that said something like “Helix Wind…that company really blows”, but I thought better of it. That wouldn’t be too professional.  I am serious, however, when I say that my readers should take a look at the company.

Helix Wind Corporation (HLXW) is engaged in the design, manufacturing and sale of “small wind” vertical axis turbines (VAWT) designed to generate clean, renewable electricity from wind.  The key for HLXW is the term “small wind”.   The company makes its case for the small wind strategy on its site:

“Small (or “residential”) wind energy systems typically generate just enough power to meet the demands of a home, farm or small business. They range from 400 watts to 500 kilowatts or more and typically consist of a single turbine (vertical or horizontal). They can be significant power sources and have proven records of performance, even in locations with modest winds.”

Here is graphic evidence on how they are different:

This is not the typical propeller blade turbine that is used on the wind farm installations that are so popular these days. This is a uniquely designed, niche product that is scalable from a single residence (the S322) to the D15000 which produces enough electricity for 10 homes or a medium size commercial facility.   Helix believes that the VAWT configuration is superior due to the fact that functions in wind that comes from all directions and is well suited to gusty wind conditions which typical blade wind turbines are not.

Here is a link to HLXW’s website. It is a very well done site and has a great deal of interesting information on it.  They also have a Fact Sheet nested on their site that makes for good reading.

Now, lets talk about the company and the chart. The company is long on promise and good news, but short on cash.  While the company is booking revenues, it is losing millions of $ every quarter.  The Balance Sheet is no help.  The company is essentially insolvent according to their last quarterly statement.  I have confirmed that the company is raising capital and is actually in a “quiet period” before the announcement which could happen as early as next month.  The key shareholders are subject to a lock-up of their shares in conjunction with the capital raise.

The company has released info on potential orders, but it is sparse.  The Argentinian deal sounds good for the company, but near term it doesn’t appear to help too much.  I would like to see more press releases about sales and distribution.   The company has not issued revenue guidance for 2010 yet, but says they plan to later in the year once the financing is wrapped up and at least one more acquisition is closed.

The chart makes for interesting study:

HLXW is a company worth watching. The stock may have farther to fall based upon momentum and trend lines.  In their industry, there is no market leader in the small wind category.  HLXW wants to become that market leader and in my conversations with the company, they feel that it can be achieved.   Certainly, government and utility subsidies and credits will continue to help drive wind power forward.   But, HLXW has to achieve their financing goals first before “world domination” is possible.

Honestly, I have fallen in love with the product and think that, on its face, it makes a great deal of sense for the market.  If the company wants to install a Helix wind turbine on my house, I will love them even more.

Good luck and good trading,

Jeffrey Dean

Editor

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I can’t quite understand why the market is so down on Newmarket Technology, Inc. (NWMT) Despite having a very solid company, the market (and traders) continue to sell the “hell out of the stock”.  As you will see in the accompanying chart, sellers are dominating and have turned a $1.00 into a penny stock over the past year.

A little about the company (from one of their PR’s):

NWMT is a reporting company with audited financial reports filed with the SEC. NewMarket provides systems integration, technology infrastructure services and emerging technology worldwide. NewMarket has a focus on providing technology and support services to rapidly growing economies where technology purchasing is on the rise (Emphasis added). In addition to its base of operations in North America, NewMarket has operations today in the growing economies of China, Southeast Asia, Brazil and Northern Latin America. Last year the Company reported over $40 million in revenue from Asia and over $20 million in revenue from Latin America. Overall, NewMarket reported over $95 million in revenue for 2008.

NWMT has been a victim of their own press release machine.  When we did an alert on NWMT a few months back, I fully expected it to be a good trading stock.  Well, it continued to freefall,  so today you can pick up shares for around 7 1/2 cents.  NWMT has hyped itself so much that traders have turned a deaf ear to their PR’s.  They continue to trumpet the fact that they were on the Deloitte and Touche Fast 500 as one of the fastest growing companies…..that is old news.  Move on, NWMT.  You are no longer a growth company.  Get over it and move on.

Let’s talk about what you are.  NWMT has got a lot of good going for it.  It should book around $100MM in revenues for 2009 in line with 2008.  No longer a growth company but in light of the current economic malaise booking the same revenue year over year is not bad at all.  It has a strong balance sheet with low debt and great debt coverage ratios.  NWMT has 19 cents in cash per share (and the share price is only 7 1/2 cents)!!!! They are a typical IT firm with razor thin margins, but they have shown the ability to turn a profit quarter over quarter and year over year.  Their focus on under-served foreign markets seems to be a good one.

Here is the chart that I mentioned:

This is a chart for a company that has lost the hearts and minds of traders.  And, they need us! They have no institutional ownership and insiders hold less than 2% of the shares.   Stop hyping the hell out of the stock and let traders know what a good, solid company this is.

I don’t know how much farther this stock can fall (my guess is “not much more”), but trying to guess a bottom on a stock has never been one of my talents.  I am looking at the indicators and thinking “bounce”.  Time will tell if I am right.  According to the company, the 4th Q is traditionally the strongest for the company.  Let’s see if NWMT can break the magic $100MM barrier and issue some news that traders actually care about.

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,  Investor Soup had previously been compensated to cover NWMT in previous months.  That agreement has expired. 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.

Intellicheck Mobilisa, Inc. just rolls of the tongue….doesn’t it? Nope! I am sure there is some great reason for such a clunky name, but that really doesn’t matter.  As a trader I am most concerned about how I think the company will do as a short-term trade.  And, I think that Intellicheck Mobilisa (IDN) might be a very good trade.

The chart indicates a company that is in decline (stock price wise).  See for yourself:

IDN is a profitable company, with money in the bank and growing revenues (year over year).  It has relevant technology to today’s security conscious world.  In fact, here is a short overview of what the company does that I took from its website:

IDN is a leading technology company in developing and marketing wireless technology and identity systems for various applications including: mobile and handheld wireless devices for the government, military and commercial markets.

Products include the Defense ID systems, an advanced ID card access control product that is currently protecting over 50 military and federal locations and ID-CHECK a technology that instantly reads, analyzes, and verifies encoded data in magnetic stripes and barcodes on government-issue IDs from approximately 60 jurisdictions in the U.S. and Canada to determine if the content and format are valid.

IDN provides total package security systems for access control to protect airports, government and commercial buildings, military installations and other critical sites as well as for first responder initiatives.

You can view the full website by clicking HERE.

The major fly in the ointment that I see currently is an antitrust lawsuit that has been filed against the company for its Defense ID product.  According to the company and to the people on the boards I monitor, the lawsuit is baseless.  I am not an attorney, so don’t take my word for it.  I can’t see any other strong or compelling reasons why the stock has lost so much value, so quickly.

I do notice that their is little buzz about IDN on the boards, meaningful/exciting news has been absent lately from their PR’s….maybe people are just bored with it.  Maybe investors are looking for better places to put their money.  Volume  is light (30K shares/day average) and a month ago 11.3% of the shares were being held short.  The shorters got what they wanted.  Could it be time to go long?!

IDN is worth taking a look at.  With a 52-week high of only $2.10, IDN could be an early Christmas present for the savvy trader.  Be aware that the trend is still down.  I never try to call the bottom on a stock, but I like the fundamentals on IDN.

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.