Home Page : www.otcjournal.com
Email Questions or Comments To:
editor@otcjournal.com
To
OTC Journal Members:
 |
Comments
in the BLOG |
 |
There have been no new BLOGs
this week thanks to some of the minor inconveniences life sends your way,
but I want review some of this past week's highlights. The week started
out with me accidentally leaving my travelling conduit to information (my
notebook computer) at the security stop at the airport enroute to the Big
Apple. I was on my way back Tuesday evening when my family was evacuated
from our San Diego home. Apologies for not keeping up with emails and BLOG
questions, but I'm sure you understand.
The family spent two nights in a
hotel, and fortunately all is well. However, in the bedlam it was tough
to keep up with market issues. Nevertheless, some really great stuff happened
this past week, and its worth having a look at.
For starters- how about that Apple
Computer (NASDAQ: AAPL) at $185- anybody read the commentary
on their Q3 numbers wherein they delivered $1 billion in profits on $7
billion in sales? They blew away analysts' estimates. The commentary- Mac
sales going through the roof, fueled by iPod and iPhone users- if you look
at my BLOGS on AAPL, this scenario was predicted on target.
My AAPL $130 January Calls have turned into one of the best trades
I have made in a long time- the mid August $12k investment is now worth
about $55K-New target price on
AAPL: $125. Still a buy on
pullbacks, which will be shallow and short lived.
Secondly and on the total other end
of the risk spectrum, how about the news out of our favorite penny stock-
Nighthawk
Systems (OTC BB: NIHK)? Wednesday morning NIHK announced it
would deliver its highest revenue number in four years for Q3- a full 55%
above the same quarter one year ago. Here's what important- the
Q3 numbers will include no revenues from the recent IPTV set top box company.
The first revenues from that product line should appear in Q4- and it should
cause another dramatic rise in top line numbers. I still believe this one
is going to have another roll at $.25- it's starting to behave really
well. Supplies could be dwindling from sellers.
 |
Titan Global
(OTC BB: TTGL): Is $2 Value Play an Oxymoron? |
|
Risky- Volatile- Scary- Gambling.
All adjectives used to describe $2 stocks that trade on the Bulletin Board.
Talk to any Merrill Lynch broker and they will tell you $2 stocks are just
gambling, and you are certain to lose all your money.
To a certain extent, some of the
stocks you read about in the OTC Journal are guilty as charged.
They are unproven, with developing technologies, a need for capital, ongoing
losses, and what I like to call the "Awesome Burden of Permanent Potential"
(see EFSF). People can lose money in these kinds of stocks. If you can't
accept that there will be losers, the OTC Journal is not for you.
Titan Global is rapidly becoming
an oxymoron- A contradiction in terms if you will. Here's what I mean-
this is probably one of the least risky $2 stocks in my experience.
This doesn't mean it can't go down. However, the way this company is headed,
your downside is limited by the pure fundamentals.
Now that Spicy Pickle's valuation
is stretched and I would prefer investors to wait for a pullback, TTGL
has become my #1 idea at this time. You should own this stock in the speculative
end of your portfolio. I feel very strongly that a lot more interest will
be materializing from investors, and you need to position yourself right
now. It's not the only idea I have, but I believe it has the most upside
potential against the least amount of risk at this time.
This past week, TTGL announced
a biofuels agreement for its $400 million Appalachian Oil subsidiary, 4
major new products targeted at the Latino demographic for its telecom division,
and the formation of a special division to look at other acquisition opportunities.
TTGL
is on a roll.
Here's your snapshot. There are only
about 60 million shares I&O. The company is currently
operating at an annual run rate north of $700 million. The
company, according to its most current forecast, is operating profitably
on an EBITDA basis. As most of you know, I don't put a lot of credence
into EBITDA forecasts- I prefer to look at cash flow. Yes, we no doubt
have substantial positive cash flow.
At $2, you are only paying
about $120 million for this company, and it is probably worth $1/2
billion.
Here's my comment on the chart. I
have circled a fairly lengthy consolidation phase. The longer this extends,
the more violently it will move to the upside when it breaks free.
That huge volume bar you see represents
a big clean up of the stock, and sets the stage for higher levels. I want
you to think of the circled area as an "opportunity" phase. This is an
opportunity to accumulate a meaningful position before the stock breaks
out. The window of opportunity was short with SPKL and AAPL.
With
TTGL it has been a bit longer, but I believe it will resolve
to the upside as the fundamentals suggest it will trade at much higher
levels down the road.
By definition, you must consider
a $2 stock risky. On a relative basis, TTGL is one of the
least risky $2 stocks you will find, with plenty of upside as more
investors learn about this one. A $2 value play? An oxymoron, perhaps.
Accumulate and hang in there for a breakout sometime between now and the
end of the year. Make yourself some real money on this one.
|
