[ Contrarian Issue: OME, Omega Protein, Edited ]
Unloved and undervalued: A Peter Lynch principle oh-my-gosh-what-a-boring-company-type situation. Here is a company that is growing well in a boring industry with its fair share of its market. The growth history appears steady in a year to year comparison:
yahoo.marketguide.com
And you can't be mad about those valuation ratios, low debt, nice ROE (hmmm), good cash as a percentage of its share price, and other goodies. Here's the Market Guide report:
biz.yahoo.com
Trend definitely negative (shouldn't we be learning our lesson?). However, the Takuri Line at yesterday's trading is interpreted as a Bullish Hammer. Active Balance Channel showing signs of a short term reversal. A little bit of digging in from the news shows a massive 796,300 share block was crossed yesterday (average volume about 89,000 shares). News today indicated a share buyback program from the company:
biz.yahoo.com
Baseline estimates a 12% growth rate, and yet the stock is priced at 6 times earnings. This is a situation opposite to Legato of a few days back, and again I am moving in for the contrarian position. I am looking for at least a snap-back to the $7.60 level, subject to constraints of the time/price dynamics of the bottom channel boundary. Interesting short interest ratio is icing on the cake.
We'll see. Apparent risks involve the price being tied to a commodity product that is in decline, and managerial issues that remain unsettled according to some Yahoo posts.
RT |
