By Leo Fasciocco -- TTD
Ticker Tape Digest presents its daily breakout and Short Selling report. It contains Breakout Stocks and Stocks under Significant Accumulation.Data is from tape action for the day. These stocks are most suitable for aggressive investors seeking ideal entry points for leading stocks.
These stocks will do very well during bull markets and strong market rallies.
TTD also presents Stocks To Sell or Sell Short.These issues are suitable for aggressive investors willing to take short positionsboth as trades or for longer-term plays. These stocks will do very well during bear markets or market corrections
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Total Buy Breakouts so far today - 3
Stocks Screened- 8,200
Bull side - Very few breakouts today as market falls sharply and broadly. Bulls be very conservative now as market needs time to heal itself.
Long-Term Environment for bulls: Unfavorable.
Market Status (Daily) - NYSE Bearish, Nasdaq Bearish
Market Status (Weekly) - NYSE Bearish, Nasdaq Bearish
RIMG, based in Minneapolis, Min., makes CD recordable (CD-R), DVD recordable (DVD-R), and digital tape (diskette) production and duplication equipment. Annual revenues: $100 million. RIMG breaks out from a 10-week, cup-and-handle base today after reporting favorable earnings. The stock is one of the few breakout issues today - a day which saw a sharp decline in the general stock market.
RIMG is trading 65,147 shares, tripled its normal daily volume of 18,900 shares. The stock is thinly traded. TTD's clip of the tape shows there was a good push up in the price in the morning on low volume.
TTD highlighted RIMG as a breakout play at our midsession show on the Web.
RIMG reported fourth quarter net up 55% to 34 cents a share from 22 cents a share ago. Revenues increased 26% to $30.5 million from 24.2 million a year ago.
The majority of Rimage's sales come from its line of CD-R and DVD-R equipment, which includes systems for premastering, recording, and labeling CDs, as well as thermal printers for labeling and decorating recorded media.
The company, which offers separate product lines for high-volume production environments and smaller office applications, also makes diskette duplication and labeling systems. The company sells directly and through distributors and resellers in the Americas, Europe, and Asia.
The company said all aspect of its business performed at a high level during the quarter. RIMG said its global channel generated sales of mission-critical Producer disc publishing systems across a wide spectrum of markets. In addition, RIMG said it continued making excellent progress in our targeted retail, medical imaging and businesses
TTD's daily chart of RIMG shows the breakout today. The stock was higher during the session but was dragged back due to the bearish action of the general stock market.
Nevertheless RIMG's TTD momentum indicator (top of the chart) remains extremely bullish. The accumulation - distribution line (Bottom of the chart) is acting well and supporting technically the price of the stock.
TTD's long-term chart of RIMG shows the issue had a powerful advance past 30, then a pull back. Now it appears set to push higher again.
For the year, RIMG posted a 15% improvement in profits to $1.26 a share from $1.10 a year ago.
Looking ahead to this year, TTD sees a 10% increase in net to 1.38 a share. There is a potential for the company to do even better.
The key for the stock near-term is that net for the first quarter should soar 63% to 26 cents a share from 16 cents a year ago. The highest estimate on the Street is at 26 cents a share.
Strategy Opinion: The general market is now weak after today's big selloff. Nevertheless, RIMG is doing well. TTD suggests a partial position in this breakout stock with a view to averaging up quickly. TTD is calling for RIMG to advance to 33 within the next few months. A protective stop can be placed near 26 and should be honored.
TTD rates RIMG an average intermediate-term play.
Sponsorship: Very Good. The largest fund holder is 4-star rated Pennsylvania Mutual Fund with a 4.4% stake. It has held its position steady. 4-star rated Bridgeway Ultra-Small Fund was the largest buyer recently picking up 113,000 shares.
Insider Activity: Neutral. Some light insider selling late last year. Not much action this year. One analyst follows the stock and has a buy.
|TTD's Breakout Profile
Rimage Corp. (RIMG)
|TTD Check List||Bullish||Bearish||Neutral|
|Near 52-week High||YES|
|Price Trend - Daily||YES|
|Price Trend - Long Term||YES|
|Price Daily Spread||YES|
|Base - A-D||YES|
|Prior Breakout Success||YES|
(The breakout List gives all stocks breaking out of a base of five weeks or more. These stocks have a good chance to trend higher. However, a stop should be used to avoid those that do not work.
(Trading strategy: One should buy breakout stocks at breakpoint by using market order or stop buy)
Ticker Tape Digests Daily List of Stocks To Sell or Sell Short ranks stocks well timed to be sold immediately based on daily trading. The list can be used as an alert to reduce current long-term positions.
Shorts from tape action so far today - 14
Stocks Screened - 8,200
Long-Term Environment for bears: Favorable.
Bear Side - Big selloff and breakdown list expands sharply. Bears now have the upper hand. Bears can be aggressive now as the major averages on a weekly basis for stocks turn down. Several TTD short plays recently falling today. Recent short play Shuffle Master (SHFL) falls 4.22 to 20.37 today. Also, following to the downside were Cohen & Steers (CNS) off 2.20 to 41.20 today. CNS was TTD's feature short on Monady.
(Trading strategy: These stocks can be sold short, or if held should be sold. If a stock is sold short, a protective stop buy should be placed. Short plays work best when the stock market is in a down trend.)
RYL, based in Calabasas, Ca., builds homes. Annual revenues: $4.8 billion. RYL falls today to trigger a TTD short play. RYL's decline reignites its overall down trend that began after the stock topped out near 80 last year. The stock's decline also coincides with the big selloff in the general stock market. So far today, RYL is trading 1.2 million shares. Its average daily volume is 1.3 million shares.
The stock got off to a bearish start. A big block of 27,800 shares crossed the tape on a big down tick to $48.83 from the prior trade at $50.
RYL annually builds about 15,200 homes that range in price from $92,000 to more than $600,000 (averaging $278,000).
Subcontractors perform virtually all of the construction, which is monitored by Ryland supervisors. The group also provides mortgage-finance services, including title search, settlement, escrow, and homeowners insurance through Ryland Mortgage.
Homebuilding stocks are now showing a decline in earnings. This year, analysts predict RYL's net will decline 55% to $3.56 a share from $7.94 a share a year ago. The first quarter will be especially with with net expected to plunge 78% to 42 cents a share from $1.86 a year ago.
Strategy Opinion: RYL is a good looking and solid short play for bears. The weakness in the market, weakness in the homebuilding sector and weakness to be in RYL's earnings are the key. Three cheers for the bears! The technicals are weak too. TTD's daily chart shows RYL's TTD momentum indicator (top of the chart)deeply bearish. The accumulation - distribution line (bottom of the chart) has been in a down trend showing the stock is under clear selling pressure.
TTD is targeting RYL for a decline to 40 within the next few months.
TTD columnist Leo Fasciocco has covered the stock market for over 20 years. His articles appear in many publications. He is also a speaker at the Intershow conferences. He has been on television and radio. He is author of many educational articles about stock investing and the book Guide To High-Performance Investing.
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(The information contained has been prepared from data deemed reliable but there is no guarantee of complete accuracy. Ticker Tape Digest Inc. is not affiliated with any broker, dealer or investment advisor. Nothing in this publication constitutes an offer, recommendation or solicitation to buy or sell any securities. Further research is advised. This report is copyrighted and no redistribution is permitted with out permission. Some of the charts are from Telescan, Insight Trading, First Alert and other sources.)