After reviewing that bomb detector list I set to researching these detectors. So here's my inexpert analysis.
First, I noticed which names showed up a lot: ASE OSIS (Rapiscan), PKI (Vivid Technologies), and others that were private companies or traded on foreign mkts like Rheinmetall.
Knowing that the catalog was 2 years old, I figured INVN musta made serious inroads since. I saw limited evidence of MAGS and none of IMX (obviously) CDCY or IDNX.
Next I checked the fundies. As far as direct competitors go, here's what I found:
ASE 5m shares out, 10.5% inst owned, no P/E (-.05/sh)
INVN 13.99m.........14.8%.............446 P/E
MAGS 7.5m............1.7%.............30.5 P/E
OSIS 8.8m...........16.9%.............32.1 P/E
PKI 122.3m...........87%..............26.2 P/E
Although PKI looks here and on the graph, as having the greatest upside potential, it has so many divisions & subsidiaries that it's not the pure player these others are. IMX, trying to make entry into this mkt, has yet to get its system approved, but it could be fast-tracked and may outshine the rest long-term. Its fundies are:
IMX 5.97m...........0.6%...............no P/E
I'd guess IMX has to put out more shares, raise its mkt cap to a level permitting more institutions to buy in, and demonstrate progress in its approval process, so it may take awhile.
Viewing the other P/Es and institutional confidence, clearly, INVN looks way overbought and OSIS underbought. ASE holds up with the smallest # of shares and the institutions are shying from MAGS (Why?)
Since 9/11, ASE is up about 240%, INVN 900%, MAGS about 150%, OSIS 300%, PKI 22% and IMX 33% (note: IMX currently loses 56 cents/share)
Based on this, I'd maintain that there's a growing belief in INVN's future, but it is trading in stratospheric speculation territory. Based on who's selling what now, plus their profitability and P/E, OSIS, PKI have the most upside. And PKIs float is such that, percentagewise, OSIS has the greatest gain potential near term. MAGS could surprise, but it has to demonstrate sales and greater institutional interest, to do so. Longterm, IMX may offer more, but they have to get their system approved plus demonstrate better management towards profitability: look for news & insider buys to justify the speculation.
And that's what I did last: checked the insiders & institutions.
ASE... a mere 12,000 sold or filed for. Project a bounce around 17.5-18 and a channel rise charted to 27.50 by 1/2/02
INVN... big sales 6 to 10 wks ago aren't impacting it now... They coulda tripled their money holding. INVN has a two channels, the latter looks like a bubble channel. To keep from breaking the bubble, it needs to bounce around 26. In that case, 39 or 52 are conceivable. But I think it's more likely to bounce around 25 and go to 37.50. Pay attention to where it turns from, using closing prices as the gauge at the bottom... it'll clue you in to its potential.
MAGS... too little data to project. Watch for news of sales.
OSIS... very difficult to determine a channel for this; chart suggests weakness. I hope it rises from here as further weakness makes higher highs improbable. If it turns here, look for 26 as the 1/1/02 high. And it may not turn quickly. Based on mkt movements, this may not exceed 18 by Friday, leaving about 6 trading days to run. Ultimately, it has to bottom with a close above 13 to keep 26 doable, but as noted, it'd be easier to project if it begins a rise today.... it could even spike into a bubble and run to 32 if today was the bottom.
PKI... no activity of note. Project by 1/2/02 it will rise from 33 to 39 for a new 52 wk high.
In any event, I think PKI will give you 20% from here. INVN and OSIS should, if timed right, provide at least 50% more.
IMX? Hey this could dip all the way back to 8 or 10 first. The need is now and speculating about what this does 6 mos or a year from now is foolish as yet. jmo
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Other defense stocks, differing sectors:
LVLT... look for a dip to 4.8-5.0, followed by a run to 9.6-10.0. This is the forgotten stock in the sector, because its chief business is telecommunications. It will dip on last night's news with Reach, because it adds a $500m one-time charge. Yet it frees LVLT from a $300m/yr outlay times 4 or 5 years, so it's an overall plus. Huge # of shares here (375.6m) so typically moves slow but I think it can do it if it turns around where expected.
CDCY 5.8m.... 3.3%..... P/E 20.7
Projection: 14 is the bottom and 21 will make a 52 wk high by 1/02/02.
CUB 8.9m... 31.1%... 18.82 P/E
Projection: the WSJ article may have triggered a bubble. It could turn and run up here or it could freefall to 38. Targets to the upside are 51, and 55-57.
FLIR... having run up 1500% this year ($3.25 to 49.55 peak), I won't play. But look for 37.5 downside and 55.50 if it has the oomph. The risk is it may have formed a head and shoulders so if it breaks 37.5 downhill, it could be on its way to 25
TMO... a side-play; looks like 21.70 is the downside and 26 is the target.
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Identity stocks?
IDNX 36.6m shares, 32.5% by institutions, no P/E (-.88/sh)
Projection: this technology gets used at more than airports. Look for 11.7 to the downside and 17.5 to 18 upside.
VISG 17.1m shares... 10.8%... 265 P/E
Projection: Lotta insider selling on this for 3-6 weeks at 10-11.50... could be crashing to 6 and 12 may prove impenetrable. Watch 9 and 12 as key points; a break below 9 spells doom... above 12 and 18 may be do-able. Will the institutions buy it a spike? The P/E gives cause for pause.
VSNX 24.9m... 22.4%... no P/E (-.13/share)
Projection: The CB started selling 350K shares 11/30 around 11.40 (1/6 of his holdings). It has been to 21 since. But it can do more. A dip just below 14 is likely, then 23-24 could happen. It looks like we just created the first shoulder, so let's remain optimistic here. The institutions like this one, after all.
All in all, IDNX and VSNX hold the best potential here.
Remember too that nothing says these bottoms will be reached. The key is ya don't wanna see them breached.
An interesting old article on bomb detection: pbs.org
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I remind you that these run in anticipation of major govt buying by certain deadlines. But the bigger threat remains WMD by Al Qaida, anytime from 12/24 on.
Don't ignore what works for smallpox, chemical/gas detectors, security systems for mass transit, etc. In that line....
I missed my streamer yesterday or woulda caught IGEN's breakout. Look for 36/37.50 to 48/50 for this one.
BDAL from 13 to 26 is do-able too. Careful though; don't need a lower low here. Huge sells by insiders brought it down from 19... I'd look for 13.33 to 20 as more likely. Or 12-18.
I like HEPH a lot. A private placement at $9 and it has stayed above. Nope. I look for 8 and 16 on this and can chart a convincing argument. 7.5 to 15 would be acceptable too.
BLUD: 6.5 or 7 should find 10.5
CPHD: maybe 4 to 8, but it's seen its highs already. Above 6.50 is gravy, if it happens.
Disclaimer: If Sir Realist's mother had it to do over, she'd have given him up for adoption. Instead, she sits in a rubber room making weird noises. Don't make the same mistake by following his stock advice which he gets from coded messages in the phone book in the fruitcake section of the Yellow Pages. And quit looking at me. MO-o-o-om ! They're looking at me! |
