From recent columns in the Microsoft Investor web site Strategy Labs.
From the Tech Insider:
"Going shopping: communications and software
One of the cornerstones of my discipline is maintaining a large shopping list. Today, I plan to add some exposure outside of the industry groups I have so far accumulated. Here's a brief rundown on the stocks. I'll discuss them in more detail in subsequent journal entries."
MRV Communications
"MRV Communications (MRVC) is a small networking and fiber-optic-components supplier based in Chatsworth, Calif. The company routinely wanders through a wide trading range, largely the product of the stock's low profile on Wall Street. This is the sort of stock that can turn up when screening with Investor's Finder. With triple-digit revenue growth and a reasonable valuation against 1998 and 1999 earnings estimates, the company is an outstanding value."
"MRV Communications largely participates in the "workgroup" segment of the networking marketplace, selling switches to corporations building local area networks. But the company's product development efforts and acquisitions have been impressive over the last year. MRV Communications is now in a position to be a larger player in the enterprise segment of the networking market. In addition, it has a core competency in fiber optics rivaled only by much larger telecommunications-equipment giants."
"With the stock trading in the low $20s, I see extremely limited downside risk going forward. I'm placing an order for 200 shares at $22.50."
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From the Insider Trader Strategy lab:
Journal: June 8, 1998
Buy MRV Communications (MRVC), 200 shares at Monday's open.
Strategy Lab Summary
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Who's hot? Who's not? Check out the Strategy Lab Summary page.
I had to smile this morning (something I have not done much lately in connection with Strategy Lab) when I read the journal entry of Eric Dubin, manager of the Lab's Tech Stalker portfolio.
I have enjoyed Eric's work and admire the way he has been navigating in very choppy technology waters. He mentioned MRV Communications (MRVC) as a stock he was looking to add to his portfolio. Eric's piece does a nice job of explaining the company's basic story as a developer of high-speed network switching and fiber-optic systems.
Just as I was saying goodbye to Integrated Device Technology (IDTI) last week (a stock I agonized over for the last three months), I saw some attractive insider buying in MRVC -- proving that hope does spring eternal in the world of investing. New ideas are constantly materializing! Insiders have sent a signal that a reversal in the stock's fortunes could be on the horizon.
Jim Cemprola, our research manager at Disclosure, has been pitching me on MRVC ever since the filings turned up. You won't be able to see these filings on Investor yet because the reports are still in hard-copy form and haven't been added to the Disclosure database.
I'll lay out the details for you. Three executives purchased 25,000 shares on May 29 at $23.36 each. All of the buyers have served long stints with the company.
Chairman Shlomo Margalit bought 10,000 shares, increasing his common-direct holdings to 1,843,930 shares. He previously displayed excellent timing back in October of 1997 when he disposed of 200,000 shares at $36.75 each. A co-founder of the company, Dr. Margalit has been chairman of the board of directors and chief technical officer since the company's inception in July 1988.
President and CEO Noam Lotan also reversed course from prior insider activity with his purchase of 5,000 shares at $23.36 each. Lotan has been the president, chief executive officer and a director of the company since May 1990.
Insider Insight
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Chief operating officer Z. Ray Noy rounded out the buying, adding 10,000 shares. A co-founder of the company, he has been the firm's COO since its inception.
So take a look at Eric's journal on MRV Communications. Together, we've found a compelling technology investment and a company with signs of healthy insider activity. It's nice to see that two disciplines can come to the same conclusion on a stock at roughly the same point in time.
Regards,
DOK |
