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Jim Van Meerten
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Jim Van Meerten is an advisor to Marketocracy Capital Management and writes on financial subjects here and on Barchart Portfolio Blogs. He earned a BS in Accounting and Business Administration from Berry College; a Juris Doctorate from the Woodrow Wilson School of Law; and attended... More
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Marketocracy Capital Management
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  • 5 Reasons to invest in telcom provider EXFO 0 comments
    Aug 4, 2010 10:47 AM | about stocks: EXFO
    On Barchart Portfolio Blogs I bring to your attention stocks you might want to consider for your portfolio.

    I'm adding EXFO Inc., (EFXO) formerly known as EXFO Electro-Optical Engineering Inc., to our Barchart Van Meerten Speculative portfolio. They are a provider of next-generation test and service assurance solutions for wireless and wireline network operators and equipment manufacturers in the global telecommunications industry. The Company operates in two segments: Telecom Division, and the Life Sciences and Industrial Division. The Telecom Division offers a wide range of innovative solutions to assess optical networks, from the core to access, as well as next-generation IP infrastructures and related triple-play services. The Life Sciences and Industrial Division offers solutions in medical device and opto-electronics assembly, fluorescence microscopy and other life science sectors. EXFO's mission is to be a world leader in telecommunications test and measurement equipment.

    Recently, EXFO acquired NetHawk Oyj, the second-largest provider of 2G, 3G, and 4G/LTE protocol analyzers and simulators for wireless network equipment manufacturers and network operators, in an all-cash transaction estimated at 37.3 million euros for all outstanding shares on a fully diluted basis, or 27.6 million euros excluding NetHawk’s net cash.

    This stock is on a move and hit 16 new highs in the last 20 sessions including 4 of the last 5. Last month saw a 14.61% price appreciation. The stock has a Barchart Trend Spotter (tm) buy signal and trades above it's 20, 50 and 100 day moving average. It recently traded at 6.04 which is above its 50 day moving average of 5.38.

    Wall Street brokerage analysts are very high on this stock with 6 buy and a hold recommendation published for their clients. Take a very close look at their projections. They project increases in sales of 31.20% this year and 22.20% next year. Earnings are estimated to increase 90.00% this year, 100.00% next year and maintain a 5 year annual compounded growth rate of 31.00%. If the stock fulfills even half of these projections it's worth looking at.

    The general investing public is also high on this stock with the CAPS members on Motley Fool voting 153 to 9 that the stock will beat the market. The more experienced All Stars vote 30 to 0.

    I'm adding EXFO Inc (NASDAQ:EXFO) to the Barchart Van Meerten Speculative portfolio because:

    • There is a Barchart Trend Spotter (tm) buy signal
    • Trades above its 20, 50 and 100 Day Moving Average
    • 16 new highs in 20 sessions including 4 of the last 5
    • Wall Street has buy recommendations released based on estimates of double digit increases in sales and earnings
    • General investor sentiment is high

    Jim Van Meerten is an investor who writes on investing here and on Barchart Portfolio Blogs. Please leave a comment below or email JimVanMeerten@gmail.com.



    Disclosure: No positions in EXFO at the time of publication
    Themes: Telecom Stocks: EXFO
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