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Carl Cachia
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I work in the medical and healthcare field so my focus is mainly on Biotech stocks. I try to find the next Celgene, the next Pharamcylics if possible. Been a trader and investor for 13 years. Love the game, and I hope you enjoy my articles on here. Good luck with your investments and I look... More
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  • U.S Silica Holdings: One Of Our Recent Favorite Buys

    Over the last week, we have initiated a position in U.S Silica Holdings (SLCA). The future is bright for this young company and we have initiated a position as we believe the price can reach new highs over the next few weeks. This article will explain why we like SLCA, both technically and fundamentally.

    The story

    SLCA is a leading silica sand supplier with a focus on performance materials that are essential to modern living. SLCA largest end market is the oil and gas industry which uses the silica as "frac sand". This sand is injected with water under high pressure in order to generate fractures in the rock. These fractures improve the well's oil and gas output. SLCA also works in wind-powered and solar energy helping in cost-effective manufacturing. Geothermal wells are also more efficient due to improved transfer. SLCA is a leading producer of industrial minerals including sand proppants, whole grain silica, ground silica, fine ground silica, calcined kaolin clay and aplite clay.

    Last earnings report

    Here are some key highlights:

    "The first quarter of the cutting was very strong for our company and we posted record revenue driven by strong performance in oil and gas and we again delivered EBITDA at the high end of our guidance range specifically on a year-on-year basis.

    Quarterly volume increased by 8% to 1.9 million tons while revenue climbed over 19% to $122.3 million. On a sequential basis volume was flat in ISP and up 17% in oil and gas.

    Adjusted EBITDA of $38.8 million increased 4.9% year-over-year and was flat sequential."

    "We expect profit demand growth to outpace rig count growth as the enhanced efficiency of those rigs drive growth in both wells drilled and stages per well".

    Onto the numbers:

    Revenue was up 19% year over year. Basis revenue for the oil and gas industry grew 37% to $73.6m. Estimates came in at 36c per share.

    Fundamental analysis

    - Market capital of $1.25b

    - Float of 45m shares after the recent secondary offering on June 3rd.

    - There is a massive amount of shorts. 12.9m shares are short, around 28% of the float.

    - Cash in hand of $42m plus the recent offering of shares that resulted in another $196m approximately.

    - 32% of the float is held by insiders.

    Technical analysis

    Both the daily, weekly and monthly charts show bullish action.

    Let's discuss the daily chart. The 50 day moving average is above the 200 day. Stochastics and Relative Strength Index are both on an uptrend. A base has been forming over the last little while and once this breaks $24 we expect new highs soon.

    (click to enlarge)

    The weekly chart shows more of the same bullish action. We believe the stock is in an early first stage or ipo primary base stage since it has only been trading for 2 years. The 10 day and 20 day moving average are rising and the price is above the respective values showing bullish action. We believe a cup and handle setup is forming with a right sided base to high 20s to occur soon.

    (click to enlargeConclusion

    We believe SLCA is very cheap at these levels. The fundamentals together with the technical analysis remain very strong. The high percentage of float being short makes us believe that a short squeeze can take this stock to new highs within the next few weeks, especially if earnings are strong like the last quarter. Furthermore, a company in the same field, Carbo Ceramics (CRR) showed some very impressive numbers recently beating estimates by 5c and we believe this bodes very well for SLCA's potential. The oil and gas industry continues to boom, and we believe SLCA is poised for continued growth.

    Disclosure: I am long SLCA. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: CRR, SLCA, long-ideas
    Jul 28 6:00 PM | Link | 1 Comment
  • Is IRobot Corporation About To Take Off?

    A stock that is coming consistently on our watchlist is iRobot Corporation (IRBT). Fundamentally, the picture is a bright one and the stock has been on a huge uptrend. A period of consolidation might occur but the stock is poised for new highs anytime.

    The story

    IRBT designs and builds robots that as the company says "that makes a difference". The company designs products that have a place both in the home, in defense and security and lately also in the medical field. I believe the latest product (RP-VITA) in the medical field is one that will take the company to new levels.

    RP-VITA

    The RP-VITA is the first remote presence solution for patient care. The robot features state-of-the-art mapping and obstacle detection and avoidance technology, a simple iPad user interface for control and interaction and the ability to interface with diagnostic devices and access electronic medical records.

    (click to enlarge)

    The future for this product

    The future for IRBT is very exciting. There are a number of new products that will follow the potential of the RP-VITA.

    Adapted from irobot.com

    (click to enlarge)

    These robots are being planned to be introduced in 2014. Potential applications include their use in security environments, material transportation, caregiver support, factory inspection and in mobile kiosks.

    Fundamental analysis

    The company is currently valued at $1.14b. The company has $137m in cash with 0 debt making the possibility of a secondary issuing of shares remote. The float is 27m, with a high 8.4% short.

    The latest earning report were stellar. Revenues came in at $106.2m, which was higher than what analysts were expecting. GAAP reported sales were also 8.6% higher than the prior-year quarter. Earnings per share came in at $0.30 which was $0.12 higher than what analysts were expecting.

    Technical analysis

    Weekly chart is a thing of beauty. A nice trend. Expect this to continue going forward.

    (click to enlarge)

    Conclusion

    There are a number of factors that makes IRBT a strong buy, even after this huge rise. There is improvement of gross margins, strategic alliances with big companies (Read here) and extensive and new product line make IRBT a stock to own for the future. I will continue to add on any dips in prices.

    Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in IRBT over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: IRBT, long-ideas
    Jul 08 1:50 PM | Link | Comment!
  • Why Electronics For Imaging Is Poised For New Highs

    I initiated a position in Electronics for Imaging (EFII) recently. The company remains in a very strong position and is poised for higher prices. The fundamental picture is very strong and technically the stock is ready for new highs soon. This article will give a brief overview of the company and why I am bullish going forward.

    The company's profile

    The company's profile can be seen here.

    The main business includes:

    "Electronics For Imaging, Inc. provides digital inkjet printers, business process automation solutions, and color digital print controllers worldwide. Its Industrial Inkjet segment offers VUTEk super-wide format UV and textile dye sublimation industrial digital inkjet printers and ink to commercial photo labs, sign shops, graphic screen printers, specialty commercial printers, and digital and billboard graphics providers; EFI hybrid and flatbed UV wide format graphics printers to the mid-range industrial digital inkjet printer market; Jetrion label and packaging digital inkjet printing systems, integration solutions, and specialty inks to the converting, packaging, and direct mail industries; and Cretaprint ceramic tile decoration digital inkjet printers to the ceramic tile industry."

    In a recent conference call seen here, the CFO described the main business of the company.

    "We manage our company is three segments; the first segment is the industrial inkjet, about 50% of our revenue. We have a software business that automates the business processes around the digital printing activity that's about 15% of our revenue. Then we have controller business, the Fiery business for the production space and industrial space and that's about 35% of our revenue."

    Latest earnings report

    In the first quarter of 2013, EFII showed growth in all three segments. Total revenue grew by 7% but profit grew by 24$. Earnings per share was $0.33, which was up 10% from the previous year despite a $0.04 non-operational FX impact in a seasonally weak cash quarter.

    Software also delivered a nice 15% growth year-over-year.

    For the next quarter, revenue is expected to be $174 to $176 million. This would be an all-time record for EFII with EPS growth expected to be between 15 and 20% growth, yielding about $0.34 to $0.36 per share.

    The company also continues to buyback shares which is very important for management to continue believing in their own company. 5 million worth of shares were bought in the first quarter of 2013, as part of the 100 million buyback program.

    Fundamental analysis

    The market cap of EFII currently reads $1.2b. The company has $381million in cash and $0 debt. This reduces the chances of a secondary offering of shares. The big cash position allows for larger buyback in the future and opportunities to merge and acquire other companies for continued growth. Revenues for 2013 are estimated to be around $700million. As one can see, the company is very cheap fundamentally. The float is quite low at around 46 million shares.

    The future

    With the healthy cash position and $0 in debt, this allows EFII to buy smaller companies to improve their bottom line.

    On May 8th, 2013, EFII announced that they had acquired printLeader as seen here. PrintLeader is a provider of management information systems. This enables EFII to continue expanding their business automation systems.

    On May 1st 2013, EFII announced that Anderson/LA, a graphics company installed EFII's superwide printers. Anderson/LA provides printers, digital print and fulfillment services to leading national restaurants, retailers and Hollywood movie studios. It is one of the first companies in North America to operate three VUTEk printers.

    Analysts continue to believe in the company. In March, Brean Capital raised the price target from $25 to $32 based on broad product cycles and operating leverage opportunities.

    Technical analysis

    The daily chart remains very strong. Prices have been consolidating recently and I expect new highs soon. Volume has been decreasing after the big jump a few weeks ago. A bullflag is forming on the daily.

    (click to enlarge)

    The weekly flag also looks quite impressive. Bullflagging again here and ready for higher prices any time. Keep an eye for volume to pick up to send this to new highs.

    (click to enlarge)

    Conclusion

    EFII remains a leader in the print industry field. EFII continues to focus on specific niche markets. The company continues to post double digit growth rate on the top line as seen in the last 3 years.

    EFII has a very strong cash position and no debt. With the impressive buyback that continue to take place, the strong earnings and record growth, combined with a strong management team, I will be buying EFII on any dips and will be adding again to my position shortly.

    Disclosure: I am long EFII. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Tags: EFII, long-ideas
    May 24 8:26 AM | Link | Comment!
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