When two of the best small-cap experts I know are recommending
the same stock, I pay close attention.
Back in September, when I was attending the
Value Investing Congress
, I met a talented young investor. I had followed his work for
nearly one year, and quickly recognized his name when I bumped
into him at a coffee break.
He was easy to spot, since he was one of the youngest people
. His name is Galileo Russell, and he's a student at New York
University's Stern School of Business.
I had become familiar with Galileo's work on
Tesla Motors (Nasdaq: TSLA)
last December when I started researching the stock. At the time,
he was extremely bullish on the stock and described Tesla as "The
Apple of the Auto World." He made this claim long before any
investment analysts were making comparisons between the two
companies or describing Elon Musk as the next Steve
When we chatted at the Time Warner Center, I asked Galileo for
his top investment idea. He described another stock that - like
Tesla in late 2012 - is misunderstood and offers investors a big
opportunity for profits.
That company is
The funny thing is, I had already heard of this company.
That's because my colleague
has been recommending the same stock.
You're probably familiar with Tyler's work. He's the advisor
investment newsletter. His service aims to uncover stocks with
100% profit potential in the next 12 to 18 months. DataWatch is
one of his favorite picks.
, our analysts will occasionally recommend the same stocks.
That's far more common when it comes to big companies like Apple
or McDonald's. But it's very unusual when it comes to small
The fact that both Tyler and Galileo were recommending
DataWatch is more than a coincidence. In my mind, it means that
two independent analysts that I know and trust see a big
opportunity in the same stock.
DataWatch is a small company. With shares trading at $28, the
company has a market value of $185 million. That makes
DataWatch a microcap, and just three Wall Street investment bank
analysts follow it.
The company operates in a high-growth sector known as "big
data." What is big data? This is how Tyler describes
"Big Data is just a fancy term to describe a growing wave
of digital information that consumes a lot of memory
space…Consider the business functions of multi-billion-dollar
companies like financial services company Broadridge Financial,
health-care provider United Health Group and consumer-goods
company Procter & Gamble.
All of these companies generate massive amounts of digital
data (and they all happen to be customers of the company I'm
recommending today). But they also consume a ton of incoming
data. If organized and analyzed together, these numbers can
help companies make better business decisions."
- Tyler Laundon,
Tyler first recommended the stock in November 2012 when shares
of DataWatch were trading at $17.75. He recommended it again in
March after shares had fallen to $12.85.
I wish I had followed his advice. Shares have already jumped
85% since his recommendation. But he thinks there is lots
more upside to DataWatch shares…
Galileo thinks so too. When he mentioned the stock last month,
I got excited and asked him to write a detailed report for
WyattResearch.com about DataWatch. This is the first time he's
written for Wyatt Investment Research.
I'm pleased to share his analysis of DataWatch in an article
on our WyattResearch.com website. The complete report is free -
no registration is required. Just
click here to read Part 1:
The Best Big Data Stock to Buy.
Please send me an email if you would like to hear more ideas
like DataWatch from Galileo. My address is
After receiving Galileo's report and reviewing Tyler's
analysis, I plan to buy DataWatch shares in my personal
investment account. I don't own the stock yet, but plan to build
a position in the stock below $30. The company is reporting
earnings on Nov. 19, and I think that could be another catalyst
for the stock.
Disclosure: Galileo Russell and Ian Wyatt personally
own shares of DataWatch.