While screening on Barchart for small cap stocks having great price momentum I came across RTI Biologics (NASDAQ:RTIX), an undiscovered stock that is beginning to be put on analysts' watch lists. The bio-medical sector is starting to move and the product line of this stock is wanted and necessary. Just look at the 11 new highs and 14.24% price appreciation this stock received even in a soft market.
Chart provided with permission of Barchart
RTI Biologics, Inc. and its subsidiaries produce orthopedic and other surgical implants that repair and promote the natural healing of human bone and other human tissues and improves surgical outcomes. The company processes human musculoskeletal and other tissues, including bone, cartilage, tendon, ligament, fascia lata, pericardium and sclera and dermal tissues into allografts, as well as bovine animal tissues into xenografts for distribution to hospitals and surgeons. It processes and distributes human and bovine animal tissues for spine, sports medicine, dental, surgical specialties, bone graft substitutes and general orthopedic markets in the United States and internationally. The company was founded in 1997 and is headquartered in Alachua, Florida. (Yahoo Finance profile)
Barchart technical indicators:
- 96% Barchart technical buy signals.
- Trend Spotter buy signal.
- Above its 20, 50 and 100 day moving averages.
- 11 new highs and up 14.24% in the last month.
- Relative Strength Index 60.27% and rising.
- Barchart computes a support level at 3.24.
- Traded recently at 3.43 which is above its 50 day moving average of 3.05.
Fundamental factors to consider:
- Wall Street analysts are beginning to follow this stock but as yet haven't published any buy signals.
- Earnings are projected to increase by 30.00% this year, another 30.80% next year and continue for the next 5 years at 26.95% annually.
General investor sentiment:
- Readers on Motley Fool are starting to put this stock on their watch lists and the 229 readers who have expressed an opinion voted 95% that the stock will beat the market.
- The more experienced All Stars are more positive with a 97% vote for the same result.
Summary: RTI Biologics is in that sweet spot I like for speculative growth stocks. It has press and is being followed by major stock information sites like Value Line and Motley Fool and has drawn the attention of Wall Street analyst but as yet has not been added to any of their model portfolios. I couldn't pass up these aggressive double digit earnings projects and have added it to both my own account and the accounts of my managed money portfolios.
I think the cultured bone and tissue industry will be a big medical growth area and this company has proven products. Because of its low price and high P/E ration this stock should be acquired only for speculative portfolios but deserves a place on the watch lists of all growth oriented investors.
Disclosure: I am long RTIX. I own the stock personally and it is a position in my clients' managed money portfolios