Sumeet Vatsa's  Instablog

Sumeet Vatsa
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I have been investing for over four years and have gone through booms, busts and flat cycles of the market. Yep, decent experience in short duration. I am an avid student of market and analyze almost all of the trades that I make, especially the ones that go belly up. I have gone through the... More
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  • And The Uptrend Continues! 0 comments
    Mar 27, 2012 2:47 AM | about stocks: SWI, TSCO, BIDU, STX, URI

    Adding to their six week winnning streak, the Dow gained 160 points +1.23% in today's session. The S&P 500 which gained +1.40% closed at its highest level since May of 2008. The NASDAQ closed at its highest level since November of 2000. All this happenened after Federal Reserve Chariman Ben Bernanke reassured the market that the horizon holds nothing but low interest rates till 2014.

    Advancing stocks led by 3 to 1 on both the NYSE and NASDAQ. Volume increased on NASDAQ by 14% and on NYSE by 2%.

    The trend is up and even the laggard small cap index is showing signs of life. But it still needs to take out the highs of 2011, which is just 2% away, before it advances further.

    Chart of S & P 500.

    To add to all the fireworks we saw some good breakouts -

    BIDU, a famous pre crisis name, might be making a comeback. It can easily reach 168$. Set a stop loss at 139$.

    One more stock that I have been eyeing for some time - SWI

    With a 3 year grwoth rate of 62%, this might be good breakout. I agree that TTM P/E=37 is on the higher side but the revenue and earnings growth lend good support to it.

    Year EPS High ($) Low ($)    
    2007 0.21        
    2008 0.43        
    2009 0.66 24 12    
    2010 0.78 24 12    
    2011 1.04 33 18    
    2012 1.15        
    2013 1.37        
    Last 4 Quarters EPS % Change Sales (million) %Change Fund Owners
    Q4 0.21 31% 43 25% 284
    Q3 0.22 29% 45 29% 347
    Q2 0.31 48% 54 31% 390
    Q1 0.29 21% 55 34% 419

    SolarWinds has created a highly profitable business by developing high quality, low-cost software products to serve the needs of small and medium-size business users of network, storage and virtualization management tools. However, the firm faces tough competition from larger, well-entrenched rivals. SolarWinds provides network management solutions to more than 95,000 customers, ranging from small- and medium-size businesses to Fortune 500 companies. Revenue is highly concentrated in the U.S., which accounted for 72% of total company sales in 2010.

    This trade has good reward to risk ratio. I set a stop loss at 36.7$.

    Another good name that popped up today that I missed altogether - TSCO (Tractor Supply Company).

    Year EPS High ($) Low ($)    
    2007 1.2 28 17    
    2008 1.1 23 13    
    2009 1.63 27 14    
    2010 2.25 49 24    
    2011 3.01 78 45    
    2012 3.51        
    2013 4.12        
    Last 4 Quarters EPS % Change Sales (million) %Change Fund Owners
    Q4 0.24 71% 836 18% 491
    Q3 1.23 18% 1178 11% 527
    Q2 0.58 45% 977 18% 589
    Q1 0.96 43% 1240 20% 641

    Tractor Supply is the largest operator of retail farm and ranch stores in the United States. The company targets recreational farmers and ranchers, and has very little exposure to commercial and industrial farm operations. As of June 2010, the company owned and operated 967 stores in 44 states, which includes 27 Del's Farm Supply stores. Stores are typically located in towns outside of metropolitan areas and in rural communities.

    Also keep an eye out for two possible break outs -

    Some good reads -

    Hedge funds drop bearish bets (BL)

    Are Euro concerns over (REU)

    Intel, Qualcomm get more pie (IBD)

    Hunger Games rakes in $155 million (MW)

    Disclosure: I am long STX, URI, SWI.

    Stocks: SWI, TSCO, BIDU, STX, URI
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