Announcing Winners Of Our 52-Week Highs And Lows Contest

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Includes: ADSK, AMWD, ASR, BTE, CBB, GDDY, IBN, INSW, KR, RGS, SATS, SGA, STB, SYNT, TCEHY, TPCA
by: SA Editor John Leonard, CFA

Summary

The 52-week highs and lows contest received 70 entries with a lot of compelling theses in which the author expects the stock to continue its current trend or reverse.

An improved pricing environment, an overhyped SaaS transition, a strong new competitor and an overlooked transformative acquisition drive our winning theses.

Be sure to check out the list of finalists for even more compelling ideas.

We're excited to announce our 52-Week Highs And Lows contest winners. We received 70 entries and were again impressed with the quality of the entries. Contributors provided a number of compelling cases for broken axles that had further to fall, success stories that haven’t found their ceiling, or stocks that were about to see a turnaround in their fortunes.

As always, it’s challenging to pick winners given the variety of theses - especially in a contest with so many possibilities such as this one. That said, we're excited to present this list, as there are a lot of excellent ideas to consider. Without further ado:

  • 1st place: GS Analytics - Long AMWD (American Woodmark) - $3,500 prize. 2017 should be an inflection year given the improving pricing environment in the big box channel while the entry in the semi-customized cabinet space helps its dealer channel revenues; this growth is being ignored by the sell-side who may be forced to play catch up with earnings revisions.
  • 2nd place: Amit Ghate - Short ADSK (Autodesk) - $2,500 prize. The sales model transition is not going as well as expected and the stock trades at an extreme valuation, which is inflated by the use of non-GAAP numbers that exclude stock-based comp.

  • 3rd place: Esekla - Short GDDY (GoDaddy) - $1,500 prize. GDDY looks like a broken growth story given the increasing threat from non-profit Let's Encrypt and a poor reputation in the developer community while the highest margin annual domain certification revenue is going away permanently.

  • 4th place: Ian Bezek - Long ASR (Grupo Aeroportuario del Sureste) - $500 prize. The market appears to have overlooked a transformative acquisition as ASR increased its traffic base by almost half while only paying out 5% of its market cap. This deal is expected to add at least $25/share in value in the short run with additional upside from overall growth of the Mexican aviation industry.

We also named 12 finalists (listed in no particular order), who each earned $150:

You can also find all contest entries here. There are a lot of interesting ideas from top to bottom, including a contrarian play in the retail space, a high-profile SOTP idea and an underfollowed emerging markets financials story.

We hope to run another contest in the coming months, though we do not have anything specific planned yet. Follow the SA PRO editors account if you'd like to stay on top of the latest contest.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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