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Summary

  • Stock market volume is at its lowest point in 6 years.
  • The latest readings for GDP and consumer confidence were disappointing.
  • Stocks that are rallying in these conditions have a tendency to outperform.

GoPro's (NASDAQ:GPRO) IPO, which started trading on the Nasdaq on Friday, have sent shares soaring, moving up 104%, a substantial IPO pop.

Otherwise the market has been boring-extremely boring. Volume is at its lowest level in 6 years. That might have something to do with the low readings for GDP and Consumer Confidence that were released last week, although consumer stocks as a whole gained.

With that in mind we decided to look for companies that have been performing well so far during the sluggish summer season. To do that we started our screen with stocks that are up for the month, as well as rallying above their 20-day, 50-day, and 200-day simple moving averages.

These statistics indicate the stock has strong upward momentum. We completed the screen by looking for stocks that were undervalued relative to their levered-free-cash-flow to enterprise value ratio (LFC/EV). This means the stocks has a lot of cash on its books for a company of its size.

Click here for the full, interactive chart.

1. Brocade Communications Systems, Inc. (NASDAQ:BRCD): Brocade Communications Systems, Inc. supplies networking equipment comprising end-to-end Internet protocol based Ethernet and storage area networking solutions. Market cap at $3.96B, most recent closing price at $9.25. Levered free cash flow at $390.96M vs. enterprise value at $3.40B (implies a LFCF/EV ratio at 11.5%). SMA 20: 0.67% SMA 50: 3.11% SMA 200: 3.48%.

2. Endeavour Silver Corp. (NYSE:EXK): Engages in the acquisition, evaluation, exploration, development, and exploitation of silver mining properties in Mexico. Market cap at $525.08M, most recent closing price at $5.34. Levered free cash flow at $52.27M vs. enterprise value at $508.92M (implies a LFCF/EV ratio at 10.27%). SMA 20: 13.07% SMA 50: 18.55% SMA 200: 20.92%.

3. Gaiam Inc. (NASDAQ:GAIA): Provides a selection of information, media, products, and services to customers focusing on personal development, wellness, ecological lifestyles, and responsible media. Market cap at $202.83M, most recent closing price at $8.43. Levered free cash flow at $17.46M vs. enterprise value at $170.18M (implies a LFCF/EV ratio at 10.26%). SMA 20: 2.24% SMA 50: 9.61% SMA 200: 22.89%.

Click here for the full, interactive chart.

4. Gran Tierra Energy, Inc. (NYSEMKT:GTE): Engages in the acquisition, exploration, development, and production of oil and gas properties in Colombia, Argentina, Peru, and Brazil. Market cap at $2.09B, most recent closing price at $7.65. Levered free cash flow at $191.40M vs. enterprise value at $1.81B (implies a LFCF/EV ratio at 10.57%). SMA 20: 5.53% SMA 50: 7.65% SMA 200: 7.86%.

5. QLT Inc. (NASDAQ:QLTI): Engages in the development and commercialization of therapies for the eye. Market cap at $274.43M, most recent closing price at $5.40. Levered free cash flow at $20.87M vs. enterprise value at $123.16M (implies a LFCF/EV ratio at 16.95%) SMA 20: 17.17% SMA 50: 14.23% SMA 200: 13.87%.

6. Silver Standard Resources Inc. (NASDAQ:SSRI): Engages in the exploration, development, and production of mineral resource properties in Argentina, Australia, Canada, Chile, Mexico, Peru, and the United States. Market cap at $676M, most recent closing price at $8.43. Levered free cash flow at $38.97M vs. enterprise value at $319.41M (implies a LFCF/EV ratio at 12.2%). SMA 20: 10.17% SMA 50: 0.57% SMA 200: 5.08%.

Click here for the full, interactive chart.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Business relationship disclosure: Kapitall is a team of analysts. This article was written by James Dennin, one of our writers. We did not receive compensation for this article, and we have no business relationship with any company whose stock is mentioned in this article.

Source: Deal Or No Deal: 6 Outperforming Stocks Under $10