Market Monitor

On a side note, it is a scary thought that today’s headline is becoming a dated cultural reference!  But, we digress…

Earlier this week Facebook (NASDAQ – FB) purchased WhatsApp for $19 billion and immediately there was a lot of buzz around the social media space.  In what appears to be a little more of a sideways market for 2014, stock picking in active sectors will be key in attaining premium returns.  Today, we decided to take a look at some of our old Market Monitor picks in the social media sector.

In yesterday’s Goldman Guide we highlighted the changing world of the financial reporting and analysis industry.  The important takeaway is that change and innovation are inevitable in sectors of the economy where large amounts of capital flow and millions of motivated people work to gain an advantage over competitors.

The same can be said with the asset management sector of financial services.  Mutual funds have almost become passé with the advent of the ETF and firms that lead the way have gained the upper hand in capital inflow from retail investors.

We rarely highlight financial stocks, primarily because they usually do not dwell in the small cap space, but about a year ago we featured Wisdom Tree Investments, Inc. (NASDAQ – WETF - $15.46) in the Market Monitor and the stock is up nearly 65% over that time.  The bull run influx of capital from John and Jane investor has been the main culprit for the Company’s growth over this time.

Though some bears may say it might indicate that news like the company’s Europe Small Cap Dividend Fund (DFE) has reached $1 billion as bad sign, we feel the stock still has room to run.  Wisdom Tree has a diverse product line and has taken some proactive steps in the anticipation of a possible slowdown in stocks.  For example, the Company introduced the Bloomberg Floating Rate Treasury Fund (USFR) fixed income product designed to help investors reduce their interest rate risk, while generating income backed by the full faith and credit of the U.S. government.  New products to meet the times will be key in keeping revenue growing.

We say to target $17 and anticipate WETF should hit that mark sometime in 2Q14.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

No doubt today’s headline is imprinted into the pop culture lexicon from America’s favorite under achiever, Homer Simpson.  Another classic is an episode where Lisa states that she is going to become a vegetarian and not eat any animals anymore.  Homer asks her if she is going to give up ham, pepperoni, and most importantly bacon and Lisa replies that these all come from the same animal.  Homer replies chuckling in disbelief,”…right Lisa, a wonderful, magical animal!”

Where are we going with Homer?  Yesterday there was a great article in MarketWatch about the bacon industry and how, despite a poor economy, it is generating unprecedented revenue for restaurants, food suppliers, and kitchenware manufacturers.  Here is the link below.

http://www.marketwatch.com/story/bacon-sales-sizzle-to-all-time-high-2014-02-11

The market research firm Information Resources, Inc. (IRI) reported that bacon sales have increased annually over the last four years and in 2013 alone, sales climbed 9.5% to an all-time high of nearly $4 billion.  Another tidbit from the article we enjoyed is the appearance of bacon related gastropubs popping up in major cities, like BarBacon in NYC’s Hell’s Kitchen district.  Clearly the rough economy is not affecting this industry.

The question is why is this important for John or Jane Q investor/trader and what macro-economic forces will benefit related stocks.  Clearly the rough economy creates an atmosphere of the consumer ingesting comfort foods like bacon and even spirits.  Case in point, last April we highlighted Craft Brew Alliance (NASDAQ – BREW) and the stock is up 106% since!  The second factor in play is the overall rise in price in food and commodities associated with food products.  At the basic level there can be no substitution as everyone needs to eat.

We looked over some stocks with some exposure to the pork industry, and yes bacon, and with an overall diversity in products.  Tyson Foods, Inc. (NYSE – TSN - $36.89) may be out of our market cap and price range but is a solid play on our themes above with a diverse portfolio.  On a micro technical level TSN is very bullish all the way out to the 50-day DMA.  Additionally, forecast revenue for the rest of FY14 and Q1 FY15 put the forward 12-month P/E at 12, under the trailing 12-month P/E of 15, a great signal in basic valuation.

Tyson is a strong brand with a presence in almost every grocery chain in the United States.  Additionally, the Company continues to try and grow organically, with introductions like its first breakfast line Tyson Day Starts™.  We think the stock is great play this year in the food industry.  The $45 level is an achievable target.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

In yesterday’s Goldman Guide we stated that we have seen some preliminary signs indicating a slow down to a meltdown in the consumer tech sector.

Right on cue, our Market Monitor pick from January 2013 Photronics, Inc. (NASDAQ – PLAB - $8.18) issued downward guidance for its FY14 Q1 financial results in EPS.  Additionally, consensus revenue for FY14 Q1 was downgraded to $101 million from $105 million.  The news sent the stock on a tail spin and the trading was actually halted at one point yesterday.  The Company cited slower than expected holiday sales in the U.S. and Europe as reasons for the lower guidance.  Just as a reminder, Photronics manufactures and markets photomasks which are high precision photographic quartz plates containing microscopic images of electronic circuits used in semiconductors and flat panel displays, and this may be a precursor for other firms in the segment as well.

PLAB is up a very solid 35% since our pick last January.  Still, on the heels of this news, and the poor technical performance of late, it is time to take profits.  Plus, the ripple effect from the big players like AAPL and SNE mentioned in the Guide could have a short term detriment on stocks like PLAB.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

For those who keep track, Punxsutawney Phil saw his shadow Sunday morning which means six more weeks of winter.  We are not sure how well a groundhog can predict the weather.  To quote Phil Connors, aka Bill Murray, from Groundhog Day, “I think winter will last until March 21^st.”  We mentioned that movie’s famous insurance salesman, Ned Ryerson, a few weeks back in the Guide so thought we would throw in another reference.

As far as thinking spring, or new, kudos to the NFL for coming into the 21^st century on the halftime show with Bruno Mars.  On the flip side, I am not sure what Chrysler was thinking by digging up Bob Dylan for its commercials.  Anyone under 35 probably had no idea who that was.

We bring these tidbits up as a lead in to doing some spring cleaning in our own Market Monitor ‘portfolio’ as the market has been giving many investors and traders the old man winter treatment for a month.  We will take a look at a 2013 pick.

We featured Ultra Clean Holdings, Inc. (NASDAQ – UCTT - $10.88) back in the middle of October and the stock closed yesterday up nearly 54% over that time.  The Company is a supplier to the technology industry with manufacturing systems and solutions that are tailored for original equipment manufacturers in the semiconductor capital equipment, flat panel, medical, energy, and research industries.  In essence that Company builds the equipment that these OEM use to build their products.

The stock itself looks like a keeper for the time being.  The technical analysis pertaining to the DMA indicates a bumpy ride or possible down turn in the short term, but turns bullish in the intermediate and long term.  Another huge plus is the simple valuation.  With the run on the stock the trailing 12-month P/E nearly 108, but 2014 revenue forecasts of nearly $500 million puts the forward 12-month P/E under 13.  Still a great value.

The bottom line is technology will still be a sector to be in for 2014.  UCTT is a nice play on this theme and the stock has room to run to $12.50 by the middle of 2Q14.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

In Monday’s Goldman Guide we mentioned that there were two important reports coming out this week that will give some idea of where the economy is going.  The Consumer Confidence Index came out Tuesday and the news was encouraging.  The index increased to 80.7 for this month marking the second straight month of an upward trend.  On Friday, the University of Michigan’s Consumer Sentiment Index is released as well and an uptick would be welcome news for anxious investors.  A play on select beaten-down, consumer discretionary and other retail related stocks might be in order.

Libbey Inc. (NYSE – LBY - $20.77) is a solid play on an increase in consumer discretionary spending in our small cap world.  The glass tableware product manufacturer is headquartered in Toledo, Ohio and has been around since 1818.  Not much cache here.  So in this ultra hype Super Bowl week with multi-million dollar ad campaigns the pick may not have sex appeal, but the brand is solid and the Company appears poised to meet the pent up demand that may be unleashed as the economy continues to improve.

Libbey has a variety of products that consumers will look to purchase as they re-vamp their kitchenware after several years of keeping that old ‘stuff’ around.  The Company offers glass tableware products, including tumblers, stemware, mugs, bowls, vases, salt and pepper shakers, shot glasses, canisters, candleholders, and various other items; glass bakeware; handmade glass tableware; and other glass products for original equipment manufacturers, such as blender jars and washing machine windows.  Libbey also offers higher end stemware, glassware, crystal, and China.  The Company’s distribution channel includes foodservice distributors, mass merchants, department stores, retail distributors, national retail chains, specialty housewares stores, candle and food packers, decorators, breweries, distilleries, craft industries, gourmet food-packing companies, and floral companies.

LBY appears very strong from a basic valuation perspective.  The forward 12-month P/E of 9 is less than half the forward P/E of 21 as the consensus revenue forecast for 2014 is expected to grow 2.5% to $840 million.  A current ratio of 1.87 indicates the Company has plenty of cash on hand to expand this year as well. Moreover, the Company is set to release its 4Q13 results tomorrow, so the combination of good results and a solid survey numbr could drive the shares higher.

We like LBY as a solid play with limited downside on an increase in consumer discretionary spending in 2014.  A 25% increase in price is within reach sometime in 3Q14.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

In Monday’s Goldman Guide we offered some hope in a somewhat miserable time in the market and recommended 1 to buy and two to sell.  Along those lines we think we have one to keep from our 2013 Market Monitor picks.

Back in early March, we highlighted Rambus Inc. (NASDAQ – RMBS - $9.58) as a solid play in technology and specifically the LED space.  The stock is up over 77% in just under an eleven month span.  Yesterday, the Company reported 2013 and 4Q13 financial results and the news was very positive.  In addition to meeting 4Q13 EPS and revenue, Rambus reported nearly a 28% increase in revenue from 2012 to 2013.  Finally, the firm estimated that revenue will be approximately $295 to $305 million for FY2014 above current analysts’ consensus of $288 million.  Deal flow was great in 2013 and should maintain positive momentum in 2014.

The LED space continues to be red hot as applications for smartphones and tablets are in high demand.  Rambus was able to capitalize on this with new license agreements signed with SK Hynix, Micron Technology, ST Microelectronics and LSI Corporation during 2013.

The stock looks strong from a technical perspective as the options contracts indicate the smart money is bullish on the stock over the next several months.  Additionally, RMBS looks as if it has entered another accumulation phase with a 13% rise over the last two weeks with about 900,000 shares traded per day.

With a great deal flow and a gross margin of 89%, 2014 should be another banner year for Rambus, Inc.  The $12 level is definitely within striking distance by 3Q14.

Have a great day!

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

Disclaimer:

This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports. 

Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.

It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations. 

The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.

This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.

ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS   INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.

For more information, visit our Disclaimer: www.goldmanresearch.com

It seems that these days everyone is looking for alpha whether it be in th einvestmenr world or on the football field. We hope we are not offending any of our readers, but anyone surprised by Seahawks defensive back Richard Sherman’s post game antics need a reality check.  NFL football has created an ultra competitive environment with multi-million dollar contracts as rewards for achievement at the highest level.  This ‘spirit’ is part of what makes these athletes elite.  Wouldn’t it be funny if we had some of these antics at the World Economic Forum in Davos, Switzerland this week? It certainly would spice up the ratings on the financial networks.  The egos here are just as large and include alpha females as well.

Along with any alpha is the end, omega.  Our Market Monitor pick from a few months ago, Omega Protein Corporation (NYSE – OME - $11.30), may be have already passed the end of its run.

One sector that was great for us and the small cap investor in 2013 was biotechnology.  We had some huge winners including LCI (+490%), TSRX (+111%) and MGCD (+95%) among others.  There is no reason to believe even that even Obamacare should derail this momentum for the right stock for 2014.  In addition, looking for a stock that had somewhat a disappointing 2013 could offer nice returns this year per the Goldman Guide New Year’s addition.

TG Therapeutics (NASDAQ – TGTX - $5.10) is a development stage biopharmaceutical that has some innovative products in its pipeline geared primarily toward the treatment of cancer. 

Back in late August we highlighted Dryships Inc. (NASDAQ – DRYS - $3.99), the bulk shipper, as a micro play on an improving European and global economy.