Friday, January 21, 2011

I Continue to Buy on Cirrus Logic- It Will Rock N' Roll !!!!

Yes, you hear me right, I am already down more than 5% on Cirrus Logic and I am buying more. I have just dump in another last 10% of my capital yesterday at the $17.31.

Technical Analysis:
1) As per the candlestick pattern, it shows that it is a Gap Down Doji, which means that indicates that the bulls and the bears are at an equilibrium, a state of indecision. Also the gap down means in this case means that whatever needs to be sold already sold here.
2) The MACD and Stochastic show a negative implication on this stock. It shows that this stock might go down futher in the future.

Although, most of the indicators show negative signal for this stock, however, I believe that this stock will be an exception for the other stocks that I have analyzed and it will reverse the downtrend line by this coming Friday morning.

I am very confidence this stock will outperform in the future because of its growing revenue and profits that it will announce on this coming Jan 27, 2011. I believe that it will announce a suprise increase in its quarterly earning that will whoop the analysts estimate by 15% or more.

Here is why:
Dec 26, 2009 = 3.67
Mar 27, 2010 = 3.33
Jun 26, 2010 = 3.51
Sep 25, 2010 = 4.64 (up)
Jan 18, 2011 = 6.34 (19% higher)

Dec 26, 2009 = 0.16
Mar 27, 2010= 0.31
Jun 26, 2010 = 0.25
Sep 25, 2010 = 0.40 (up)
Jan 27, 2011 = (at least 15% higher)

If you look at the earning announcement for both the companies, the correlation between the jump in earning is very close.

I would bet big that on Jan 27, 2011 that Cirrus Logic will announce at least 15% higher earning than the analyst estimates and it will send the stock sky rocker to at least 20% gain. If you look at the history of many stocks, it will have a tendency to jump up with a big gap especially small cap growing companies like Cirrus Logic.

If turns out to be bad and I lose on this bet, not only I will take a big hit and bite the bullet, as promised on my previous post, I will shut down this blog, and I will never blog about stocks market ever.

Disclaimer : This is not an investment advisory, and should not be used to make investment decisions. Information in The Market Oracle Blog is often opinionated and should be considered for information purposes only. No stock exchange anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. The charts provided here are not meant for investment purposes and only serve as technical examples. Don't consider buying or selling any stock without conducting your own due diligence. 

Cirrus Logic (CRUS) Top Pick From Interview Earlier This Year With Mary Lisanti Of AH Lisanti Capital Growth, LLC: Veteran Institutional Investor All Star Sees Strong Growth Potential In This Apple (AAPL) Supplier
12/29/2010 - The Wall Street Transcript has just published offering a timely review of the sector. This Best Growth Stocks For 2011 Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.

View This Special Report

Recent Wall Street Transcript Special Reports.
Mary Lisanti is a 30-year veteran of small cap growth research and investing. She is the Founder, President and Chief Investment Officer and manages the firms' only product; a small cap growth strategy. Mary spent the first twelve years of her career as a small cap analyst and strategist on Wall Street. During the past 13 years, she has managed small cap portfolios at three premier asset management companies.
In her most recent position as CIO of ING Investments, LLC, (1998-2003) she was responsible for building of the active equity management team. During her tenure there, assets under management in her area grew from several hundred million to several billion dollars. Prior to that, Mary was at Strong Capital Management as Senior Portfolio Manager for both the Small Cap Growth and Mid Cap Growth Strategies.
From 1993-1996, Mary was Managing Director and Head of the Small/Mid Cap team at Bankers Trust Company. Mary was named Fund Manager of the Year in 1996 by Barron's. She was named #1 small cap analyst in 1989 by Institutional Investor's All-Star Research Team. In addition, she was ranked #2 and #3 in 1987 and 1986 respectively. Mary has a BA in English from Princeton University. She is also a member of the NYSSA.
TWST: Are you finding good opportunities in specific sectors or industries?
Ms. Lisanti: The thing that's interesting is that we are finding opportunities all over the place, in almost every sector. If you look at the financial sector, we see companies like Portfolio Recovery Associates (PRAA) who buy credit card debt, credit card portfolios and bankruptcy portfolios for $0.05, $0.10 on the dollar and hope they can get $0.12, $0.13, $0.14 out of them. They went through a difficult period the last few years as the portfolios they bought in 2006 and 2007 didn't live up to expectations. But they are getting very good opportunities now to purchase good portfolios. They've made a lot of investments in their infrastructure to handle the growth and they are in the sweet spot of their cycle.
We have also been finding opportunities in the consumer sector, primarily for two reasons. The first is that consumer spending is good, I wouldn't describe it as great, but it's in line with GDP growth. It's up 2%, up 1%, up 3%, that kind of spending; and they are spending in a very targeted way. The American consumer is spending on things that they perceive as having value. Now that doesn't always mean the cheapest, but it could mean something that is perceived as great quality. An example is Lululemon Athletica (LULU). They make high tech apparel for women focused on yoga and running. They are doing very well in this environment and truly never saw the stock price suffer through the downturn.
We are finding companies that have restructured their businesses, where they have improved their products and brand, are winning customers back, companies like Ann Taylor (ANN) and Talbots (TLB). Then you've got companies that are flourishing like BJ's Restaurants (BJRI), where they just stuck to their knitting in a difficult consumer environment and provided a very good value for the consumer, and a nice dining environment.
In the technology sector, we are focused on companies that have strong product cycles.We happen to like Cirrus Logic (CRUS), which is an example of a company that looked at its businesses and said, "we need to get better, we need get sharper" and they changed the way they manage their R&D processes. What they did was take their R&D people and tie them in with sales and marketing. They are bringing up more new products and they have increased the percentage of products that actually get turned into sales. As a result, they have significantly accelerated their growth. They have two areas of focus, one is consumer and another in green/ industrial. In the consumer space, they are lucky enough to be in a lot of the Apple (AAPL) products so they benefit from the newer Apple products which are experiencing very strong demand. And then in the industrial space, they are focused strongly in new buildings with lighting structures and temperature, controlling energy and electricity expense.
TWST: How has that changed over the last 12 months? Were you seeing some opportunities in areas that you wouldn't have found a year ago? You mentioned financial.
Ms. Lisanti: Yes, financial sector is one for sure.
The remainder of this 119 page Best Growth Stocks For 2011 can be immediately viewed by purchasing online.

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