|Written by GSCR Staff|
|Monday, 09 September 2013 23:15|
In Monday’s Goldman Guide we offered seven key insights to playing the market in September. One of our points was the discussion centered around stock indices and weighting, and the fact that if a narrow segment of tech is weighted heavily in the NASDAQ Composite, and that group is on fire, it does not necessarily translate to all or even related tech stocks. Our play is to follow the volume leaders.
Today we are highlighting 3 picks, two old ones previously featured in the Market Monitor and a new one. We set our screeners to filter out small cap tech stocks that have averaged over 750,000 on the volume side.
Here we go:
Rambus, Inc. (NASDAQ – RMBS - $8.94)
We featured this stock back in early March and it is up nicely, nearly 66% as of the close of the market yesterday. The stock has traded on average over a million shares over the last three months and from a technical analysis perspective the 5-day and 20-day DMA are very bullish. As a refresher, Rambus plays in the LED space, which continues to remain on fire, and is expected to get into the black in 2014. A nice pop to $10 is possible by October 1.
RF Micro Devices (NASDAQ – RFMD - $5.38)
RF Micro Devices is a fairly mature company in the small cap space with a diverse offering line with several products used in smart phones and other telecommunications devices. RFMD has traded a little sideways since we highlighted back in early April, up just 3.85%. Again the momentum and technical analysis are very bullish, as the stock is trading nearly 4.5 million shares per session, and the 5-day, 20-day, and 50-day DMA are very bullish respectively. RFMD could hit $6.25 by October 1.
Applied Micro Circuits Corporation (NASDAQ – AMCC - $12.26)
This is a new pick with the application of our September volume formula. AMCC is averaging over 900,000 trades per session over the last three months as the stock has been accumulated. The technical analysis is also showing a very bullish signal all the way to the 50-day DMA. The company manufactures connectivity products for the next generation of data centers and network hubs. Even in the slow growth economy many large companies are spending money upgrading systems to keep up with ‘the cloud’. AMCC is expected to get into the black with earnings at $0.12 per share for FY14 (ending March 31 2014) and spike up to $0.46 per share in FY15. AMCC has room to get to $13.25 by October 1.
Keep on riding the train.
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.
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