|Written by Rob Goldman|
Missed It by That Much
I bought some tickets and after the drawing I believe I came as close as I ever will to winning the jackpot, should I choose to play again.
Although I may have had 2 numbers right on my tickets, the winning ticket was purchased at a 7-Eleven convenience store about 5 miles from my home. Probably the closest I will ever get to a few hundred million. Unless I break my cardinal rule and buy some of my own recommendations...but more on that later. I am a voracious and speed reader of anything related to stocks and finance and spend hours every day perusing all kinds of data and information that temporarily turns me into the main character from Rain Man. (12 hours til the market opens. No Wopner on TV anymore.)
With the end of the first quarter, I came across some key data points which do not bode well and further bolsters some of our recent comments on the near term outlook.
According to Barron's from the earnings perspective, 4Q11 results in the S&P 500 rose 13% but would have been only 10% without Apple. If you look at 1Q12's projected earnings figures, excluding Apple, there will be no earnings growth year-over-year. Ouch. With no earnings growth, high oil prices, and other economic uncertainty, we need solid sequential quarterly earnings and other catalysts to keep the market going. For now, we are handicapping flat to down 2% for the S&P 500 for Q2.
Select Research: Small Cap Picks
The table above is surprising and telling. For 4Q11, our small cap picks dramatically outperformed the microcap (sponsored) research picks. This quarter, the reverse occurred. The stocks in the table above were all recommendations mentioned in 1Q12 editions of The Goldman Guide. While as a whole it appears that the recommendations slightly underperformed the Russell 2000 Index, one must take into account that recommendations were made throughout the quarter, as compared to the static performance of the index from 1/2/12. These figures reflect quarter-end prices returns and peak returns achieved post-recommendation. The peak price performance reached 17% versus the 12.4% YTD numbers and would be even higher if the last 2 stocks, introduced only a week ago, were not included.
Micro Cap Picks Up an Average of 97%
Admittedly, these Opportunity Research performance numbers are skewed, but regardless, it is impressive as these four stocks rose an average of 97% for the period. We remain very positive on all 4 stocks.
SSIE: Although Q1 was likely very challenging for SunSi Energies, other solar players are starting to bounce back. We think new business and business development initiatives will enable SSIE to return to its former levels.
ECTH: ecoTech has its ducks in a row with respect to executing its business plan and we expect more news, including some revenue recognition in Q2.
MIMV: With its biggest competitor acquired by Apple, Mimvi is ripe for a takeover at a premium to its current price. A former Google controller just joined the MIMV team which is a huge plus. Once liquidity increases, the stock should move higher.
NVLX: Once the SG Austria deal closes the overhang on the stock and naked shorts will be removed, causing a short squeeze. Nuvilex’s current value is still less than what the pancreatic cancer treatment is worth alone. It likely goes to $0.15 once it breaks through $0.08 again.
Little known fact:
I am also the editor of pennystockjunction.com and for Q1, we had at least 10 stock picks up over 30% in 30 days!!!
Until next week...
Analyst: Robert Goldman
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 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.
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