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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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Total Buy Breakouts so far today - 11
Stocks Screened- 8,200
Bull side - Modest number of breakouts today. However, some very good looking plays. Bulls be venturesome.
Long-Term Environment for bulls: Favorable.
Market Status (Daily) - NYSE Bullish, Nasdaq Bullish
Market Status (Weekly) - NYSE Bullish, Nasdaq Bullish
UCTT, based in Menlo Park, Ca., makes customized gas delivery systems used in the production of semiconductors. Annual revenues: $147 million. UCTT breaks out from a five-week, flat base today with a very good expansion in volume. The stock hits a new high and could well attract more buying from the "new high-crowd."
Generally, TTD prefers stocks with longer-bases. However, with UCTT we make an exception because of the strong volume we are picking up. The stock did breakout from a longer base at 16. So, the overall continuity of the up trend makes us bullish on the stock.
So far today, UCTT is trading 922,975 shares, double its normal daily volume of 437,000 shares.
The stock is showing good tape action in the afternoon. TTD's clip of the tape spotlights a big block of 5,900 shares crossing on a modest up tick to $19.34 from the prior trade at $19.32.
Ultra Clean Holdings helps chip makers handle gases under ultraclean conditions. It is a play on the semiconductor industry. TTD has spotted several semiconductor stocks which are doing well. So, we are comfortable with UCTT.
UCTT has a catalytic steam generator designed for use in several chip production steps that call for high-purity steam.
The firm was a unit of Mitsubishi Corporation. UCTT gets 40% of its sales from Applied Materials and 31% from Lam Research,
A look at TTD's weekly chart of UCTT below shows the stock's bullish pattern. The past two years it has climbed from 5 to 19.
Today's breakout appears to be a continuation of the overall up trend. The strong volume is extremely bullish.
The stock's TTD momentum indicator (top of daily chart) is solidly bullish.
The accumulation - distribution line rose sharply in February and is now poised to move higher.
This year, UCTT's profits should climb 33% to $1.11 a share from 83 cents a year ago. The stock sells with a price-earnings ratio of just 17. That is half of the projected growth rate in net and makes it an extremely attractive value-growth play.
Going out to 2008, profits should jump 37% to $1.51 a share. Based on a p/e ratio of 20, the stock has a potential volume of $30 a share.
UCTT's net for the upcoming first quarter should soar 79% to 22 cents a share from 12 cents a year ago. The highest estimate on the Street is at 27 cents a share. That says some analysts see a real big quarter possible. The stock could well be moving higher in anticipation of the quarterly numbers.
Strategy Opinion: TTD is very bullish on UCTT. We are looking for the stock to climb to 25 within the next few months, or sooner. A protective stop can be placed near 18, which is tight. TTD rates UCTT an excellent intermediate-term play provided earnings meet expectations.
Sponsorship: Very Good. 5-star rated Bridgeway Ultra-Small Company Market Fund was a recent buyer of 118,000 shares. The largest fund holder with a 2.3% stake is 4-star rated Munder Micro-Cap Equity Fund, 4-star rated.
Insider Activity: Neutral. Insiders were recent buyers using stock options. They turned around and sold. Four analysts follow the stock, 3 have a buy, up from none three months ago.
| TTD's Breakout Profile
Rating Ultra Clean Holdings Inc. (UCTT) |
| 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 | 14 | 0 | 0 |
(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 - 1
Stocks Screened - 8,200
Long-Term Environment for bears: Unfavorable.
Bear Side - Only one breakdown stock today. Bears be conservative. TTD's lone breakdown yesterday is working for bears. Neurochem Inc. (NRMX) is down 0.32 to 12.02 today.
(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.)
FIC, based in Minneapolis, offers statistics-based predictive tools for the consumer credit industry. Annual revenues: $831 million. FIC breaks down hard today to trigger a TTD short play after forecasting weak earnings. So far today, FIC is trading a hefty 5.2 million shares, 12 times its normal daily volume of 421,000 shares.
The selling pressure on the stock is intense. TTD's clip of the tape shows a big block of 96,700 shares crossing the tape in the morning on a big down tick to $37 from the prior trade at $37.34. That showed heavy and urgent institutional dumping.
FIC said net income for the fiscal second quarter would be 35 to 37 cents a share, down from 48 cents a year ago. The consensus on the Street was at 50 cents a share. So, the forecast was a surprise disappointment.
FIC's customers include credit card companies, retailers, commercial lenders, insurers, and healthcare and telecommunications service providers.
The company provides applicant scoring for insurers, and financial risk and database management products for financial concerns.
The stock's gap drop today on big volume is extremely bearish. TTD is targeting FIC for a decline to 30 within the next few months. We see the stock as an excellent 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.)