Daniel Long's  Instablog

Daniel Long
Send Message
In-depth Wall Street fundamental and technical research. Get past all the hype and go strait to the numbers with every type of valuation measure imaginable. Including individual stock, industry, sector, country and exchange analysis, as well as competitor and benchmark comparisons. Access our... More
My company:
Extreme Value Stocks
My blog:
  • NASDAQ Stocks Under $10 Ready to Break Out 0 comments
    Jul 13, 2011 10:23 AM | about stocks: LAVA, LVLT, GLUU, AFFX, AKRX


    With tech trying to make a slow comeback that has been in the making for close to a decade now, a slew of NASDAQ stocks priced below ten dollars are finding new 52 week highs. Below, we zero in on five poised to see further gains in the months to come, especially if this comeback comes to fruition.


    LAVA (Magma Design Automation Inc.)


    Magma Design Automation, Inc. provides electronic design automation software products and related services. The company has now seen three straight quarters and two years of accelerating revenue and increased gross profits. Over the past two quarters, the company has come into profitability. Growth is forcasted to continue over the coming years, and the stock has a PEG ratio right at 1. A relatively small amount of shares outstanding, 66 million, coupled with a history of relative self-control with respect to dilution makes this stock a solid bet for the mid-term.


    LVLT (Level 3 Communications Inc.)


    Level 3 Communications, Inc. engages in the communications business in North America and Europe. We recently covered LVLT in our article “Highly Liquid Stocks Under $2.00 for Active Traders”. At that time, we saw LVLT simply as a short-term trading opportunity. Our view has changed a bit, as fundamental improvements and strong price action has us seeing opportunities for the mid-term. Revenues and gross profits have been improving quarter over quarter for the past year and although the company has yet to hit profitability, it has beefed up the asset portion of the balance sheet quite substantially. LVLT now has over a billion dollars in cash, nearly twice what was seen just a couple of quarters ago. Although profitably is not seen in the near future, double-digit earnings growth is. The cash stockpile coupled with rapid growth overseas and some new initiatives, including a deal with Global Crossing (NASDAQ:GLBC), may allow the company to see green sooner that what is expected.


    GLUU (Glu Mobile Inc.)


    Glu Mobile Inc. is a leading global publisher of 3D Social Mobile games for smart-phone and tablet devices. After a very promising looking first quarter this year, GLUU came out at the end of may and upped their guidance for the second quarter. Non-GAAP revenue is expected to be between $16.0 million and $17.0 million, up from the previous range of $15.0 million to $16.5 million. Non-GAAP net loss is expected to be between $1.9 million and $2.7 million, or a net loss of $0.04 to $0.05 per share, compared to the previous range of $1.9 million and $3.1 million, or a net loss of $0.04 to $0.06 per share. The primary growth driver has been a dramatic increase in smart-phone revenue. The possibility of even more upward revisions remains, especially with a slew of social media IPOs ready to take off, including Zynga, the provider of social and mobile games. This market is extremely hot right now, and although playing the games is not a problem, finding ways to play the investment is. Glu Mobile, a small cap, is a great way to get on board well before any of the IPOs hit the market. The company has zero debt and $24 million in cash on the balance sheet.


    AFFX (Affymetrix Inc.)


    Affymetrix, Inc. engages in the development, manufacture, sale, and servicing of consumables and systems for genetic analysis in the life sciences and clinical healthcare markets. Bio-tech is not quite as hot as mobile gaming right now, and this company's flat revenue growth over the past several years adds evidence to this. Gross profits, however, have improved dramatically over the past three quarters, and the company has seen some profits. The balance sheet looks pretty good for a bio-tech with over $80 million in cash, only $95 million in debt and a book value of $4.20. The improved margins along with fairly consistent revenue over the past five years bodes well for this stock in the mid to long-term future. The company is generating a huge amount of cash relative to its peers.


    AKRX (Akorn Inc.)


    Akorn, Inc. is a generic pharmaceutical company engaged in the development, manufacture, and marketing of multi-source and branded pharmaceutical products in the areas of ophthalmology, antidotes, anti-infectives, and controlled substances for pain management and anesthesia in the United States and internationally. Despite recently hitting a 52 week high, this stock still looks undervalued based on analyst estimates, with an upside of at least 30%. Revenues and gross profits have grown dramatically over the past year, and the future looks even brighter with 25% earnings growth per year predicted for the next five years, and 66% growth seen for the current quarter. The stocks PEG is below the industry average.

    PSW is completely unbiased and unvested.  For more free articles like this one, please visit our website.  Seeking Alpha readers please enjoy a free two week trial to our premium content here.

Back To Daniel Long's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


  • Bucking the Trend: $IIJI way undervalued compared to other 4 issues in our most overvalued ind. in the tech sec., Internet Serv. Providers.
    Mar 8, 2013
  • Internet Service Providers Overvalued-5 stocks Avg. P/E-44, PEG-1, P/S-6. One has P/E-6, PEG-0.2 & P/S-1... $IIJI $SIFY $VIPS $Z $QIHU
    Mar 8, 2013
  • 2 stocks hitting 10 yr highs in our most Undervalued Ind-Home Health Care, in most Overvalued Sec-Healthcare $ADUS $CHE http://bit.ly/Xxbb1g
    Feb 20, 2013
More »

Latest Comments

Most Commented
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.