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Strategies & Market Trends : A.I.M. PIC List (Perverse Investment Candidates)

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To: OldAIMGuy who started this subject1/22/2002 3:40:13 PM
From: OldAIMGuy  Read Replies (1) of 127
 
The first new PIC stock for 2002!

Nautica NAUT joins the PIC list as a Timeliness #5 "Highest Growth Stocks" listing this week in Value Line. With that honor we've started the Buy and Hold record keeping and an artificial AIM account with last Friday's closing price of $13.95.

Although not ideal for use with AIM, it offers potential. Here's the way I'd analyze it using Value Line and the things I feel make a good AIM candidate:

- BETA - 1.05 (lower than I like)
- Inside Trading - in concert with Options, okay
- Officers and Directors common stock ownership - 18.2%; Very good
- LT Debt - only 4% of capitalization; very good survival
- Stock's Price Stability - 35 out of 100; a bit high but acceptable.
- Hi/Low Annual Share Price Ratio - 1.91:1; good
- Sales double last 5 years? Yes; good
- Book Value double last 5 years? Yes; good
- Projected 3-5 year Sales growth - 11%; okay
- Projected 3-5 year Book Value growth - 17%; Very Good

The annual share price ratio of nearly 2:1 would indicate that AIM would have had activity in the last 10 years and if the stock's "personality" doesn't change much, should keep AIM active in the future as well. With the price about 30% above its post WTC/Pentagon lows, it has recovered some of its distance to its previous 52 week high.

Value Line with a Timeliness rating of #5 is stating that the stock will underperform the general market during the coming 12 months. Well, the history of the PIC list indicates that buying these stocks when out of favor can be profitable, and if managed by AIM can even do better.

Best regards, Tom
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