Opnext, Inc. (OPXT) has seen a huge drop in its stock price due mainly to bad financials for their last Q. I think that the market has overreacted and that OPXT might be a great radar stock.

OPXT is a technology spinoff from Hitachi Corporation’s Fiber Optics Division.  OPXT specializes in the manufacture of a portfolio of 10G and higher optical products and solutions. They sell communications modules, optical transport subsystems, laser diodes and infrared LED’s.  Their biggest customer is Cisco Systems (almost 40% of their business) which is a scary fact.  As long as Cisco doesn’t go anywhere, they will be o.k.  What is happening to OPXT is symptomatic of the entire industry and until it comes back, OPXT will continue to struggle.

OPXT has a very dull website, but there is a lot of information there.  Here is a link: OPXT site

The good news is that OPXT can struggle and it will be o.k. Traders hammered the stock when it missed guidance last Q, Analysts downgraded it and the CEO says that next Q won’t be much better.  So what, I say.

OPXT are running a cash-rich business. They are very well situated to continue to weather these economic storms.  According to Yahoo! Finance, OPXT has $1.62 in CASH per share. The stock is only trading for $1.82.  Reviewing their balance sheet shows me that they have got strong Quick and Current ratios.  Debt is manageable and coverage is strong.

The chart is very telling, too:

• Steep price drop with sellers dominating
• A heavily oversold stochastics indicator
• MACD is actually turning positive after the selloff
• MACD is still bearish, but intensity of signal has decreased dramatically

Has OPXT found the bottom?  I am not sure, but I think they are close.  You can look at the chart and see where it was “basing” at around $1.85 and $1.90.  The stock didn’t hold that level though.  I think the next few days will be telling.

I recommend putting OPXT on the trading radar and watching it to see if it has a “bounce” in it.

Good luck and good trading

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It seems that with all the hysteria and hype surrounding gold, our email boxes are being flooded with mail about the next “hot Gold stock”.  Arguably, some are very “hot” and others are “not”.  One of my more regular and enthusiastic members, Michael K. sent me an email alerting me to a Gold play that I had never heard of:  Constitution Mining Corporation (CMIN).

On its face, it is no different than most gold plays.  CMIN has 2 gold fields (in their case the Gold Sands Region of Northeastern Peru) that, according to the company, has proven reserves of over 72 MILLION ounces.  They are busy “proving out” these claims and, while they have no current revenue, are hoping to be a producing gold mining company in 2010.

Here is a link to their website which has a lot of information: CMIN site. They have a nice intro video on the first page that gives good info about their plan and prospects.

What sets CMIN apart is that investors are backing them whenever they need money….and, that is all the time.  With a burn rate of an average of a $1,000,000 per quarter, bank accounts shrink rapidly.  But, CMIN has been able to raise the capital they need WHEN they need it.  They have done several rounds of financing since they “came back to life” as CMIN two years ago.  Rumor has it that they just recently completed a $5MM round recently at a very good price for the investors.

A little aside here (and a teachable moment) - CMIN is the 4th incarnation of their public shell which started out 9 years ago as Crafty Admiral Enterprises (a seller of classic auto parts).  Two other failed ventures (oil and gas, nickel) completed the resume until CMIN took over.  So you see…..these companies rarely go away, they just change names.  There is no guarantee that an investor in the first business back in 2000 would still have valuable shares (due to recapitalizations, reverse splits, etc…), but CMIN’s situation is highly instructive to what happens with penny shells.

O.K. back to CMIN! - Here is the chart for CMIN.

CMIN is not a low-priced stock. It has a hefty valuation for a company that is still an exploration company.  I talked with the company and they are very bullish about their prospects.  The geology and potential of their gold fields could make them a high flier, the financing (and their ability to raise funds not once, but several times) speaks volumes about the efficacy of their claims.

I recommend watching CMIN. It would be nice to see if it could retest its recent high of $1.90, but this might be a longer term play.  I would definitely play the volatility, but keep this one on your target list.

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.

Just a quick heads up on one of my favorite stocks:  Legend International Holdings, Inc. (LGDI). I blogged it back on September 14th when it was at 60 cents…….good timing on my part because it ZOOMED to $1.11 in just a week after I blogged it. I believe the setup is very similar and a short-term bounce is possible.

I love this stock and this company.  LGDI is a very boring natural resource play….they are an exploration company that is exploring and mapping giant deposits of  Phosphate Rock….a crucial component of fertilizer and industrial products.  They own millions of acres of land in Australia (in proven mining zones) and are a well-capitalized, well-managed mining operation.

I will have more about LGDI in the future, but they announced some strong news today, too.  The company announced the formation of a strategic alliance with Wengfu Group Co. Ltd (Wengfu) for the development of LGDI’s phosphate mine, a beneficiation plant and a phosphoric acid plant in the Mt Isa region, Queensland, Australia.  Wengfu, once the DD is completed, will become an equity partner (joining an already prestigious group of institutional investors, including George Soros) and lend its technical expertise to LGDI.

Here is the chart….you can see the stock has given back much of its gains and has an attractive chart.

I expect that you will hear a lot about LGDI from me in the weeks and months to come.  I really like it!

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BlueWave Advisors, which is the owner of this website has been compensated a total of seven-thousand five hundred dollars by Legend International Holdings for coverage of LGDI.

I spent hours every day looking through stock screens searching for companies that I can share with my readers and members that I believe present “profit opportunities”.   I could be looking for a stock to fall or rise.  When I select it, I try to do the underlying research and then do the chart analysis so my readers can make their own decisions.

Today’s stock actually is a little bit scary…..it is in the midst of a prolonged selloff and I can’t quite understand why.  The selling pressure is so high right now that I expect it to bounce in the near term.  Once it finds a bottom (therein lies the challenge).

U.S. Concrete, Inc. (RMIX) has shed over 60% of its stock value since early November.  One share costing$1.90 stock on November 1st can be bought for only $0.74.

Take a look at the chart:

The chart ix painful to look at, but I think that there is an opportunity with RMIX.  Don’t catch the falling knife, but radar this one.  IMHO, the stock will find a bottom soon and then begin adding back value to its shareholders.

RMIX is in a depressed industry (Ready Mix Concrete), has been forced to write-off huge amounts of goodwill for acquisitions it has made previously, has issues with noteholders and banks (liquidity problems and covenant breaches) and faces an uncertain future.  In other words…..they are just like any other company in today’s economy.

I am not trying to trivialize their situation, but I feel that shareholders are overreacting and that could mean an opportunity for traders.  I have searched the news and boards to check and see if RMIX is headed for BK or something dire and can’t come up with anything.  All of the sellers are about out of the stock….time to be a contrarian and take a look at RMIX.

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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.

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 find banks really boring.  It doesn’t help that I used to work at a bank and when I was a CPA, I used to audit banks.  Every day on the bank audit it was like pouring hot coffee in my lap….excruciatingly painful.

Doing my nightly chart scans, I came across a bank that has an interesting chart, seems to be faring reasonably well financially and is a multi-billion dollar bank selling for around $5.

The bank is Marshall & Isley Corporation (NYSE: MI) I know!  A NYSE stock on my little blog.  It calls itself a diversified financial services corporation, but scratch the surface and it says “bank”.   I like the chart and think it should be watched for some more bounces, but I also like the news.

MI seems to be very handy at raising capital. They are getting oversubscribed for their issues (2 so far this year) and they are using some of those funds to pay off their dreaded TARP loans.  MI is not out of the woods yet.  They continue to post operating and net losses and still have the same issues that face all banks these days, but they have done a good job cleaning up their balance sheet.  Their “mark to market” adjustment was only $1.5 billion!  That is a lot of bad loans!

The chart:

As you can see from the chart, the pressure on the stock is to rise.  The Stochastics are deeply oversold, but now turning up.  The MACD is bearish, but the histogram indicates the lessening of the bearish trend.  It is still well below the zero line and I would like to see the MACD give more positive indicators before trusting it too much.  Both up and down volume have picked up lately….maybe it is under accumulation again.  You can see from the chart how far it has fallen from its recent high.

Much of this “evidence” of a bounce is anecdotal.  Yesterday, the stock was up 10%.  I would watch it to see if that trend continues.

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

I monitor a number of boards including our own Stock Hideout.  “Supposed” hot stocks are flying all over the board, so that I almost have become immune to all of the hype.  However, one name that keeps popping up (so much that I can’t ignore it) is Atlantic Wind and Solar (AWSL).  I must admit that I first heard about AWSL in mid-August when it was around $1.20.  Looked interesting, but seemed extended. Boy, was I wrong.

AWSL reached an intraday high of $4.84 today. It was a rocking stock, too.  Short sellers hit it and it dropped down to $3.02 only to recover strong and close at $3.89.  The question that it begs is are the short sellers going to rule or not.  Tim Sykes was all over AWSL and, while he is right that it has been promoted vigorously, I am not convinced that it is going to fall.

AWSL (The Company) - Whoever wrote their website copy majored in expressive writing in college, but I was able to cut through the flowery speech and figure out what these guys do.  They are aiming to be in the forefront of the wind and solar revolution that is sweeping the world.  By partnering with corporations, associations, land and business owners, AWSL will install, service, manage solar and wind installations that can range from a single rooftop to a full parks.  They are touting relationships that they are working on that will drive them to profitability and a pre-eminent position in the industry in a short time.

The important thing to remember that solar is not the answer to our energy dilemma, just part of the answer.  Most solar installations have a hard time running…um, in the dark for instance.  However, a combination of tax incentives, energy savings, profits from sale of excess energy and the cachet of being green should make this a hot commodity to their intended customers.

Keep in mind that AWSL has two things going for it:  News and Chart

The latest release proclaims that “AWSL Strengthens Alliances and Declares Dividend”

AWSL has a small float (under 20MM shares I am told) and this dividend will increase their market liquidity.  The release went on say, AWSL has “declared a 1-for-3 stock dividend, payable on December 7, 2009 to shareholders of record on November 23, 2009. For every three (3) common shares held on the record date, shareholders will receive 1 free additional share on the payable date.”  That to me will spur more buying in the stock.

Another release that I find encouraging is that they have retained an SEC auditor to get them compliant as part of their plan to upgrade their stock listing (AMEX would be my guess).  It is about time!

Here is their chart with my comments:

Also of note are several insider buys.  Two insiders have purchased a combined $3.2 million in stock at prices ranging from 50 cents to $1.54.  Obviously, they are betting that AWSL will go a lot higher.

My conclusion is that traders should radar list AWSL.  If you trade it, make sure you have a tight trailing stop on it.  Take the gains as they present themselves.  If the stock goes up appreciably, you can relax the trailing stop so you don’t get “stopped out” on any dips (and there will be some IMO).  If this stock gets hot, it could be a $10.00 stock based upon the buzz about it…..Don’t trust buzz though.  I would like to see AWSL start booking deals, signing contracts, getting necessary financing, become a reporting company, etc…, but until then I still remain a fan.

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.

After several days off, I am itching to get back in the markets.  As I was doing my screens this morning, I came across Nephros Inc. (NEPH.OB). The company is a small cap company in the medical device business and has a chart that I found interesting.

The company was a penny stock until it  had a huge run up starting in late May when it ran from 12.5 cents to $2.50 in mid-August! Since then, the stock has cooled off and dropped down to $1.38.  Looking at the chart, it looks to me that the profit takers have driven the price down and now might be a good opportunity to profit on the bounce that I believe is coming.

Why do I think their might be a bounce? NEPH appears to be a pretty solid company.  They have a solid balance sheet….cash in bank and no long-term debt.  They have revenues, but no profits yet.  With two main product lines, NEPH appears to have good potential.  Their main business is End Stage Renal Disease products in the area of filtration.  They also have patented (and received FDA approval on) a line of water filters that just recently received $2MM from the Office of Naval Research to expand development of their water microfilter for military use.

The stochastics indicate that the stock is oversold, but the MACD is still solidly bearish.  This stock may trend down for a few more days, but it appears to me to be ready for a bounce.  The news on the company has been very positive and I can see why investors bid this up from $12.5 cents to $2.50.  I don’t see this stock going back to penny stock status.  If NEPH can commercialize its water microfilter product, the “sky would be the limit”.

Radar list this one…check back daily and see if it is turning

Ecototality sounds like the commando wing of Greenpeace or some radical environmental group. The name, to me, doesn’t really speak to what it does.   Ecotality, Inc. (ETLY) is another one of those penny stock “Green” companies that is going to save the world! Here is their corporate description:

ECOtality, Inc. (OTC BB: ETLY), headquartered in Scottsdale, Ariz., is a leader in clean electric transportation and storage technologies. Through innovation, acquisitions and strategic partnerships, ECOtality accelerates the market applicability of advanced electric technologies to replace carbon-based fuels.

Despite my kidding tone, I am actually impressed by what Ecototality has done.  They are a “real” company that does business in 4 separate divisions (at last count).  I won’t go into a full description of the company.  You can click here to go their corporate overview page which will give you an idea of the scope of what they do.  Their eTec division is the one that is garnering them the most attention (and cash!).

Two things make it a penny stock that I want to share with you:  Chart and News

Let’s look at the chart:

The stock was a high-flyer very recently and has taken a steep dive since the heady days of early August.  Good news and strong buzz drove the small cap stock from 12.5 cents to 46 cents in the matter of a few days.  Since then, ETLY has given all of that gain back.   The chart indicates that the selling pressure has driven the stock to an oversold position.  The sentiment was so high that the recent PR about an $8MM grant from the State of California didn’t lift the stock.  The MACD is still bearish, but the angle is decreasing, as the histogram indicates.  The penny  stock is at a good support level and if it holds here, it could turn up quickly.

I mentioned news.  Well, we have the recent PR about their CA award to build charging stations for electric vehicles in San Diego County.  The scope of the project and the partners that e-Tec (an Ecototality subsidiary) is working with is very impressive.  Further news has to do with the U.S. Department of Energy awarding the company approximately $99.8 million to undertake the largest deployment of electric vehicles (EVs) in history.  ETLY has even signed a separate agreement to create a grid and charging stations in China!

As a trader and a recovering CPA, I have seen my fair share of “green companies” come and go.  The promise of  green technologies cannot be overlooked, but it seems that too many companies slap that tag on their company and expect that good vibe to translate to their stock price.  ETLY is committed to being “Green”, but they also want to make money while they are saving the environment. That is good news for investors.

ETLY is a small-cap, penny stock company that might not be one for very long! Keep it on your radar and look for this promising penny stock to turn.

Geron Corp. (GERN), a biopharmaceutical company, develops therapeutic products for the treatment of cancer and chronic degenerative diseases, including spinal cord injury, heart failure and diabetes. The Company develops a range of anti-cancer therapies, including anti-cancer therapies based on telomerase inhibitors and telomerase therapeutic vaccines, and also focuses on the development of products using telomerase as a marker for cancer diagnosis, prognosis, patient monitoring and screening. continue

A drop in new jobless claims and the growth in retail sales gave Wall Street a kick in today’s morning and mid-day sessions; today’s stock alert features several market movers, most of which secured gains by noon.

Today’s Stock Alerts Include: U.S. Steel (NYSE: X), AK Steel Holding Company (NYSE: AKS), CR Bard Inc. (NYSE: BCR), Sprint Nextel Corp. (NYSE: S), NVIDIA Corp. (NASDAQ: NVDA) and Ford Motor Co. (NYSE: F).

U.S. Steel (NYSE: X) Stock Alert – U.S. Steel Upgraded by Morgan Stanley

Shares of U.S. Steel (NYSE: X) and its steelmaker competitors have enjoyed investor enthusiasm for the sector during the sharp rebound in basic materials commodities. Additional fuel for investors came Wednesday following Morgan Stanley’s announcement of its upgrade of U.S. Steel, as reported by the Associated Press (AP). Shares of U.S. Steel gained 3.36% this morning, trading at $41.47. continue