Steve,
I was going to post the same info as soon as I got to the end of the thread. I just subscribed to Zacks and I asked their rep. about Zack's system. His program is heavily weighted to revisions in earnings estimates. Several analysts have recently revised their earnings downward. Even if their long term outlook is positive, I think the near term downgrades heavily influence Zack's model. I didn't ask about this, but if TA also figures into his model, it would also influence his number downward. I don't know squat about TA but there is a very obnoxious but apparently knowledgeable poster on the AOL Claires board who has been making the case that Claire's techicals are terrible.
I first bought Claires at 14 in late Nov. and watched it quickly rise to 17 before the year end tax loss selling, etc. kicked in. Interestingly, 17 is what the TA people say is the upside resistance point. Perhaps we might see that as soon as the overhead clears out. There are an awful lot of small investors out there who bought at prices considerably higher than todays level. It seems like every time the bid and ask volumes get equal or the bid side gets larger, another big block pops up on the sell side. On the positive side it seems like the sellers are not selling at market because I've noticed a fairly large imbalance in recent days with the price holding pretty steady.
For those of you who are new to Claires, I would suggest you print out a weekly or monthly (weekly is better) price chart for four or five years. You'll notice a pattern of a low in late fall and a run up in the late winter/early spring. There was a poster on AOL who said this pattern holds true back 10 or 11 years if I remember right. I only went back about four years but it was enough confirmation to give me some positive expectations for the next few months. The large teenage demographic bubble that is coming along should bode well for this company regardless of the short term glitches. Lastly, I would suggest that, if you have access to AOL, you go back to Aug or Sept and log all the messages to date. You may have to go to several archived folders to get all of this because Claires is very actively followed on AOL by a mostly helpful group. If you print these posts out you'll have a pretty good historical picture of what's been going on with the stock. I first looked at Claires when I heard that Louis Navellier held 1 mil. shares. I then realized that it was on the Motley Fool Investing for Growth 10 stock portfolio. It has recently fallen to # 13 in the standard IFG ranking because Value Line has lowered it's group rank slightly. It was still ranked 1 for timeliness last time I checked. The only explanation I could come up with for Claire's price drop was the CEO's stock sale. My guess is that the stumble in the stock's price caused some of the momentum players (though not Navellier) to bail and thus increased the downward momentum. Eventually the bottom has to be reached and I think we are close. Then the positives will kick in for the benefit of the patient.
Happy Investing,
Bob |
