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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.
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Total Buy Breakouts so far today - 16
Stocks Screened- 8,200
Bull side - Good number of breakouts today with some interesting plays. Nasdaq index weakening. Bulls be selective.
Long-Term Environment for bulls: Favorable.
Market Status (Daily) - NYSE Bearish, Nasdaq Bearish
Market Status (Weekly) - NYSE Bullish, Nasdaq Bullish
CRNT, based in Tel Aviv, provides wireless solutions for cellular and fixed wireless operators. Annual revenues: $74 million. CRNT breaks out powerfully from a 16-week, cup-and-handle base today to make a 52-week high. The move was triggered by a strong earnings report. So far today, CRNT is trading a giant 1.6 million shares, 16 times its normal daily volume. Impressive!
One of the largest trades crossing the tape was a big block of 10,899 shares, which went off on a big up tick to $7 from the prior trade at $6.84.
The company's network access systems, which combine microwave transmission terminal hardware (FibeAir) and network management software (CeraView), are used by communications service providers to offer high-speed wireless Internet access to subscribers.
CRNT sells its products directly and through alliances with other equipment makers.
The company came in with net for the first quarter of 11 cents a share, up sharply from 4 cents a share a year ago. The 11 cents topped the consensus Street estimate of 7 cents a share and the highest estimate of 8 cents a share. The big upside earnings surprise was taken in a very bullish way despite a sell off in the overall stock market.
Revenues for the quarter surged 59% to $34 million from $21.3 million a year ago. The company benefited from strong demand from emerging economies. It said bookings were very strong.
The strong profit growth should continue. For the upcoming second quarter, analysts expect net to jump 144% to 7 cents a share from 3 cents a year ago. The highest estimate on the Street is at 8 cents.
Net for the year should leap 60% to 30 cents a share from 19 cents a year ago. The stock sells with a price-earnings ratio of just 23. TTD sees that as attractive for value-growth investors.
Strategy Opinion: CRNT is a low-priced speculative play, but one that is acting extremely strong. TTD is very bullish on CRNT and we see it as a good stock to play as a breakout.
However, we would be a bit cautious due to market conditions. One can scale-in to this play. TTD is targeting CRNT for a move to 9 within the next few months, or sooner. A protective stop can be placed near 5.80 giving it room.
TTD rates CRNT a very good intermediate-term play because of its strong earnings outlook.
Sponsorship: Very Good. The largest fund holder is 4-star rated Perrit Micro Cap Fund with a 1.8% stake. Also, 4-star rated Brazos Small Cap Fund was a recent buyer of 58,000 shares.
Brothers Zohar Zisapel (chairman) and Yehuda Zisapel (former director) collectively own 25% of the stock.
Insider Activity: Not available. Five analysts follow the stock, 3 have a buy, one is neutral and one has a sell. RBC Capital put out an outperform rating on April 12. They have a target of 8.
|TTD's Breakout Profile
Ceragon Networks Ltd. (CRNT)
|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 - 3
Stocks Screened - 8,200
Long-Term Environment for bears: Unfavorable.
Bear Side - Very few breakdown today. Bears be conservative. TTD short Omnicare (OCR) falls 1.27 to 33.62 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.)
Ormat Technologies Inc. (ORA), based in Reno, builds geothermal and recovery energy power plants. ORA gaps lower today in heavy volume after forecasting a loss for the first quarter. TTD sees the stock as a good "shock short." By that we mean a stock falling after some shockingly bearish news. So far today, ORA is down about 4 points so far today. Volume is running at 955,400 shares, seven times its normal daily volume of 138,000 shares.
ORA's tape shows some heavy selling late on Friday. A big block of 60,600 shares crossed on a big down tick to $41.19 from the prior trade at $41.24. The action indicated aggressive institutional selling pressure.
ORA said it will report a loss for the first quarter between 14 and 17 cents a share. It blamed increased maintenance costs and lower revenues due to delays.
The company, established by Israel-based Ormat Industries, also sells power units for both types of plants. Ormat operates geothermal plants in 20 countries. The Bronicki family owns 30% of the company.
For the upcoming second quarter, ORA is expected to show a 21% drop in profits to 19 cents a share from 24 cents a year ago.
The stock's gap drop today was preceded by a breakdown in the TTD momentum indicator (top of the chart). The stock's accumulation - distribution line is extremely bearish and breaking down again. TTD sees ORA as a very good short. TTD is targeting the stock for a drop to 30 within the next few months, or sooner.
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.)