Every morning I wake up now I'm reminded that summer is
essentially over, and we're entering the shoulder season here in
the northeast. Some in Vermont call it stick season because soon
the leaves will turn vibrant colors and fall to the ground, leaving
only bare branches.
On this particular morning while considering what I could write
about I began to reminisce about the summer months - and the
companies discussed here in
Small Cap Investor Daily
. So I decided to revisit prior suggestions, and check out their
returns since I wrote about these companies.
And I've got to say, I'm pretty pleased with the results. Of
course, it's always easy for those of us who recommend stocks for a
living to cherry pick the best results and only present those -
while letting the 'losers' drift from our minds.
But I assure you, I haven't done so in this case. I just went
back through the article archives to some of my favorite daily
articles and pulled five articles published since mid-July. These
articles had 7 companies in them, and the average gain?
Pretty good, we're up 14 percent through yesterday's close. Not
too shabby for half a summers work.
Check out the chart of the S&P 600 Small Cap Index since
, the date of my first article featuring today's revisited stocks.
As you can see, the index, which covers 600 small cap stocks, has
risen about 4 percent.
So what are the stocks that have done well for us over the last
two and a half months?
Let's go in chronological order and look back at
Callaway Golf (
I covered this company in
A Pattern of 18 Percent Average Gains
and from publishing to yesterday's close the stock is up 14.5
Callaway is one of the top golf companies in the world. The
company makes and sells high-quality irons, drivers, golf balls,
golf bags, GPS range finders, and other accessories. The premise
for buying Callaway was a strong pattern of seasonality in the
stock. Explaining this, I wrote:
"Historically, as Callaway reports strong earnings in the
first half of the year, analysts raise estimates and the stock
price trends higher. With demand for products down and few
attention-grabbing events for the rest of the year, earnings
reports are weaker in the fourth quarter and the stock price
tends to move lower".
Moving on to
Cash In On The X-Games
which was published on July 30
QuickSilver Inc (
Hansen's Natural Corporation (
We're down 13.9 percent on laggard QuickSilver but are up 10.2
percent on Hanson.
Remember that Quicksilver is in the process of cleaning up its
balance sheet as it works through a financial restructuring plan.
Regarding the company's future I wrote:
If this company can get its balance sheet in order, the stock
could be a strong performer. Sales growth is essentially
projected to be flat for the next two years, but analysts expect
earnings per share to grow by 200 percent next quarter, by 350
percent next year, and by 56 percent in 2011.
Well, shares have lagged - but in our current economy where
consumer spending is not that strong company's like QuickSilver are
just treading water, trying to stay afloat as they position
themselves for better days.
Hansen, the maker of Monster Energy Drink, has lived up to my
expectations. I wrote,
"Monster has had success competing with the veteran energy
drink Red Bull. In 2008 Hansen's made great strides by partnering
with Coco-Cola to distribute its product internationally, and has
since inked deals with Pepsi to distribute in even more
countries, most notably Red Bull's home turf of Europe... From a
technical perspective, the stock is a great buy at $40 (if it
breaks below this look for dip to $37 and change). However, I
wouldn't be surprised to see the stock move higher ahead of
After we left the X-Games in California, we moved on to the
wheat ban in Russia in
One Stock That Will Benefit from the Wheat
. This article featured
Terra Nitrogen Company (
on August 9
, a stock that is down a modest 1.9 percent since.
The stock rallied hard after Russia's Prime Minister, Vladimir
Putin, announced that Russia would ban all grain exports for the
rest of 2010. The announcement came after wildfires swept across
the country and destroyed a large amount of the country's crop. The
crop was extremely susceptible to fire since Russia experienced
We departed Russia to land back on domestic soil in
Two Brewing Stocks to Whet Your Appetite
on August 16
. Our craft beer tour began in Boston, MA at the
Boston Beer Co. Inc. (
producer of the popular Samuel Adam's Lager and Twisted Tea.
Regarding the stock, which is up 4.6 percent since the article, I
"Boston Beer is growing fast enough that it may soon outgrow
craft beer status. The brewer expects to sell more than 2 million
barrels by 2012. But just because the company may outgrow the
'craft brewer' definition doesn't mean it isn't a compelling
investment. It may just be in the sweet spot - small enough to
gain greater popularity as a top-quality brewer but large enough
to gain distribution efficiencies and greater shelf space."
From Boston we hopped (no pun intended) a flight to Portland,
Oregon where we enjoyed the offerings from
Craft Brewers Alliance, Inc. (Nasdaq: HOOK).
This company brews 31 high-quality regional craft beers including
Redhook Ale and Goose Island - some are gaining attention at the
I've been bullish on the craft brewers, and expressed my outlook
as follows in that article,
"The homegrown element of craft beers is also something
that's very appealing to the growing number of consumers who
subscribe to the local food movement. If these people like to
purchase food that's grown closer to home, it's rationale to
assume they like to do the same with beer. Of course, buying a
'local' beer that brewed on the other side of the country isn't
exactly in-line with the localvore food movement, but the idea is
pretty much the same - and it's easier to bottle and ship a craft
brew than a dozen cherry tomatoes."
And clearly I'm not the only one bullish on Craft Brewers
Alliance. Since my article was published the company was up a
whopping 70% through yesterday! But is the ride over?
Check out this chart, which shows one of the strongest momentum
moves on high volume I've seen in quite some time - clearly
somebody out there is accumulating shares. But this morning the
stock is falling sharply, down over 15 percent.
However, even with this pullback, investors would be up 55
percent since my article, and no stock should move higher in a
straight line. That said, this stock has been moving higher so
fast, and so consistently, that it's not the least bit surprising
to see a major pullback. Keep watching for a good entry (not at
current levels) - I think that Craft Brewers could be a strong
consumer stock over the next couple of years, if it remains
But be careful, like other popular stocks before it (remember
Crocs (Nasdaq: CROX)
Krispy Kreme Doughnuts (
), Craft Brewers displays the characteristics of a high flyer that
could move too far too fast.
After the brewery tour ended, we finished our summer tour with
ZAGG Incorporated (Nasdaq: ZAGG)
When Apple's Sales Rise, This Company Profits
Since publication the company, which makes protective coverings for
electronic devices including iPods, iPhones, iPads, and global
positioning systems, has seen its stock move 14.9 percent
Regarding this little company's prospects I wrote,
"If the trend toward mobile devices continues, as I believe
it will (and most research supports this position), soon the
majority of people with mobile devices will be flocking to ZAGG's
products to protect their investment. It could even be a takeover
target, although at this point that is pure speculation."
So far, investors at least appear to be flocking to the
So there's a little tour down memory lane since mid-summer. With
these stocks, investors could have made an average gain of 14
percent through yesterday, with big gains possible with Craft
Brewers Alliance, ZAGG, Callaway, and Hansen Natural.
***I also follow a number of high potential small cap stocks in
Small Cap Investor PRO
portfolio. Right now we're sitting on gains like 6 percent, 17
percent, and 20 percent - all on stocks added in the last couple of
months. We even have a high yielding small cap that pays a dividend
over 9 percent, and a gold mining company that has seen shares
surge 10 percent this week.
To learn more about this gold miner,
and receive the special report. When you do you'll be able to gain
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for your portfolio too.
Did you buy shares in any of the companies discussed above? If
so, shoot me a message, I love to hear your success stories. My