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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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To email Leo leo@tickertapedigest.com.For service, email Beverly Owen owen@tickertapedigest.com. TTD’s Tel: 1-480-926-1680.
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Total Buy Breakouts so far today - 3
Stocks Screened- 8,200
Bull side - Small list of breakouts today with overall quality below average. Bulls remain conservative.
Long-Term Environment for bulls: Unfavorable.
Market Status (Daily) - NYSE Bearish, Nasdaq Bearish
Market Status (Weekly) - NYSE Bearish, Nasdaq Bearish
SNHY, based in Sarasota, Fla., makes high-performance screw-in hydraulic cartridge valves and manifolds. They are used in construction, agricultural and heavy machinery. Annual revenues: $135 million. SNHY reemerges from a 16-week flat base today. SNHY is a thinly traded issues. One of the bullish omens on today's move is the expansion in volume despite a weak stock market.
So far today, SNHY is trading 88,158 shares. Its average daily volume is 30,200 shares. In the afternoon a big block of 1,506 shares crossed the tape on a sequence started by an up tick to $23.20 from $23.16. (see table)
SNHY has facilities in the United States, England, Germany, and Korea, as well as a joint venture company in China.
In business since 1970 and a public company since 1997, SNHY sells its products globally, primarily through independent distributors, to diverse markets of mobile and industrial equipment and machinery manufacturers.
To sustain future growth and continue to increase its market share position, SNHY is seeking to broaden the market for screw-in cartridge valve applications, to selectively expand its products lines, and to continue geographic expansion.
A look at TTD's daily chart shows SNHY's basing pattern with upside resistance around 22. The stock pushed through that 10 sessions ago. However, it stalled on a follow through. Today, TTD spots that and to us the stock is now breaking out to the upside.
SNHY set up its base after rally from 16 last year. The stock tends to be a slow mover. Its beta is 0.35 compared with the S&P 500 beta of 1.00. That means SNHY's stock is half as volatile as the stock market.
Although the stock would seem to be conservative, TTD is attracted to it because it is now acting much strong than the market and most other stocks.
Also, the stock's TTD momentum indicator is bullish (see top of the chart).
The accumulation - distribution line has hit a new peak confirming the strong buying supporting the rise in the stock's price. So, the technicals are in gear for the stock.
TTD's long-term chart of SNHY shows the stock still in a powerful up trend.
This year, SNHY's earnings should rise 14% to $1.65 a share from an anticipated $1.45 a share a year ago. The stock sells with a modest price-earnings ratio of 14.
Net for the fourth quarter of 2006 should come in soon. TTD expects 21% gain to 32 cents a share from 26 cents a year ago. The highest estimate on the Street is at 33 cents a share. TTD does not expect any surprises.
Strategy Opinion: SNHY is a conservative breakout play in a down trending phase of the stock market.
TTD sees SNHY with a shot to get to 28 within a few months. The stock is showing very good Relative Strength. We see low downside risk. However, a protective stop can be placed near 21. TTD rates SNHY an average intermediate-term play.
Sponsorship: Good. The largest fund holder is Royce Total Return Fund, 4-star rated, with a big 4.2% stake. It was a recent buyer of 47,000 shares. There has been very little selling by the top fund holders recently.
Insider Activity: Neutral. Some light insider selling around 23 recently. There has been no insider buying recently. Two analysts follow the stock, one has a buy and one is neutral.
| TTD's Breakout Profile
Rating Sun Hydraulics Corp. (SNHY) |
| TTD Check List | Bullish | Bearish | Neutral |
| Near 52-week High | YES | ||
| Volume | YES | ||
| Tick Volume | YES | ||
| Price Trend - Daily | YES | ||
| Price Trend - Long Term | YES | ||
| Price Daily Spread | YES | ||
| Base Structure | YES | ||
| Base - A-D | YES | ||
| Earnings-Quarterly | YES | ||
| Earnings-Long Term | YES | ||
| Earnings Outlook | YES | ||
| Industry Group | YES | ||
| Prior Breakout Success | YES | ||
| Fund Sponsorship | YES | ||
| Total Score | 11 | 0 | 3 |
(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 Digest’s 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 - 9
Stocks Screened - 8,200
Long-Term Environment for bears: Favorable.
Bear Side - Modest number of break down stock stocks today as market turns choppy after recent decline. Bears still favored by the new down trend. Bears be selective. TTD's recent bear play Accredited Home Lenders (LEND) tumbles 6.09 to 15.60 today - a great play. Also, Friday's bear play GMX Resources (GMXR) drops 1.55 to 29.76.
(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.)
AZZ, based in Fort Worth, Tex., is a specialty electrical equipment manufacturer serving the global markets of industrial, power generation, transmission and distributions It is also a provider of hot dip galvanizing services to the steel fabrication market nationwide. Annual revenues: $231 million. AZZ has the "double bearish whammy" on it. The stock is heading lower due to lowered earnings expectations and a bearish technical pattern.
So far today the stock is down 2 points. Volume is running at 52,000 shares, double its normal daily pace. The stock is thinly traded. A look at TTD's clip of the tape shows that AZZ got off to a bearish start today. A block of 2,500 shares crossed the tape on a down tick to $39.05 from the prior trade at $40.01.
AZZ said back on Jan. 19 that earnings this year should be $2.70 to $2.80 a diluted share, and revenues should be $275 to $285 million. The company said its estimate assumed a continuation of strong domestic markets, penetration of selected international markets and reduced volatility in the cost of zinc and other key commodities.
The market responded bearishly to the news back in January (see TTD's daily chart). That is because the forecast portends an 18% drop in net for the anticipated $3.35 a share in fiscal 2007.
TTD's daily chart shows AZZ evolving now into a typically bearish head-and-shoulders pattern, with the breakdown from support at 40. The tip off to the bearish pattern is that the accumulation - distribution line is extremely bearish. TTD is targeting AZZ for a decline to 32 within the next few months. The stock looks like a solid bear play.
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.”
For information to subscribe to the Ticker Tape Digest Services call: B. J. Owen at 1-480-926-1680. Distributed by Corona Publishing Enterprises. Ticker Tape Digest Inc. P.O. Box 2044 Chandler, Az. 85244-2044. TTD “Professional Report” is available on the World Wide Web: $100 per month. Password needed. “TTD Professional“ Faxed is $200 per month. The TTD Daily Report is $39.95. Credit cards accepted.
(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.)