|Written by GSCR Staff|
|Tuesday, 30 September 2014 06:00|
With world events spilling over into what appears to fast becoming a bear market there may be trepidation in putting one’s hard earned cash into the market.
However, as we mentioned in yesterday’s Goldman Guide, there are some opportunities for some gains with plays on seasonality and 2015 valuations.
It’s hard to believe, but the malls have already started to ramp up for the holiday season, and it will be full bore after Halloween. Now is the time for the holiday trade. Restaurant chains offer an alternative to the retail sector as Q4 revenue can benefit greatly from the holiday season shopping and consumer trends to eat out more during this time of year. Good Times Restaurants, Inc. (NASDAQ – GTIM - $6.04) looks like it can offer the upside on the holiday trade.
First off, the Company through its subsidiaries, develops, owns, operates, and franchises hamburger-oriented drive-through restaurants under the Good Times Burgers & Frozen Custard name in Colorado. It also has franchised restaurants in North Dakota and Wyoming and as of August 04, 2014, the company operated and franchised 36 restaurants.
GTIM appears to have entered a solid accumulation phase. The stock has climbed 60% over the last three months on nearly 75,000 shares traded per session. The chart below illustrates the great upside on the technical side as the stock is trading over the 20, 50, and 100 day EMA.
GTIM 20, 50, 100 Day EMA
(Source: Yahoo! Finance)
Finally, the top line revenue is expected to jump nearly 40% from FY14 of just over $27 million to $37 million in FY2015.
We think GTIM continues its run through the end of the calendar year with an increase of 25% from its current price level.
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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