How about a company that you may not know but you know their products. Technically,Furniture Brands International (FBN) has everything going for it on Barchart but fundamentally its a speculative pick. Management has put in place a turn around strategy. The stock will rise or tank on the success of that strategy's implementation.
Recent price momentum is what draws me to this stock. Slow and steady.
- 100% Barchart short term
- Trend Spotter buy signal
- 12 new highs and up 23.70% in the last month
- Relative Strength Index 71.86% and climbing
- Trades around 5.16 with a 50 day moving average of 4.35
- Management has 2 major problems to solve -- store costs and manufacturing costs
- Shuttered stores are now being subleased
- Manufacturing is being moved from high cost areas to Mexico and Indonesia
- Consumers who are employed may not be able to move but they are upgrading the furniture in their homes
- Wall Street brokerage analysts have published 1 strong buy and 3 hold recommendations
- Sales are expected to increase by only .20% this year and 5.60% next year
- Earnings are the story with a projection of an increase of 43.40% this year and 93.00% next year
- As measured on Motley Fool investor sentiment is very split -- but isn't that where you make the best plays? Getting in before the herd is always best.
- CAPS members are split 94 to 89 that the stock will out perform the market
- The more experienced All Stars seem equally split 41 to 36
My advice is to recognize that this is a speculative issue not a core position. It's price is rising so if you buy, place a stop loss. Be along for the ride while it lasts.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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