Opportunities come in all forms. Beleagured and beaten down victim NeWave is making a corporate performance statement, and the stock is finally responding in kind.
The company is now achieving what I had hoped it would achieve one year ago when I was covering the situation with more regularity. After some expansion missteps in mid 2005 which ended up battering the stock to absurdly oversold levels, the company is now running on 12 out of 8 cylinders, and it is just beginning to be reflected in the stock price.
CEO Mike Hill and his management team are to be congratulated on the awesome job they have done righting the ship. Consider this year’s press releases: 1. January 26: NWWV partners with behemoth Igram Micro to bring 30,000 technology products to members 2. Feb 8: www.onlinesupplier.com gets 10 million hits in January. 3. February 12- enrollment up 80% from December to January 4. Buydiscount.com enrolls 4,000 members in 2 months 5. Mar 7- NWAV retires $330k in debt from cash flow. 6. Mar 22: NWWV post record Q4 and full year in ’05. 7. April 4: NWWV retires another $200k in debt from cash flow 8. April 7: Memberships surge another 72% over previous month.
Wow- I’m exhausted. How much better can it get? Can you smell the profits? Q1 numbers should be quite robust. There is no doubt the company has positive cash flow- they paid off $500k in debt in Q1 alone. Could they be announcing their first profitable quarter? We’ll see.
The stock has been in a herky/jerky uptrend since the first of the year. Over $7 million in revs in ’05. Current market cap- $12 million- However, based on early results, I bet they are on a $15 million annual revenue run rate now. The stock is probably trading for less than 1 times sales.
Here’s the chart:
I circled yesterday’s whopping volume surge. It traded 1 million shares, and made a high of $.35 on a big, spikey run. As you know, I am in favor of selling into big, spikey runs.
Looking at the short term retracement opportunities, the stock has already come down to Fibonacci’s .38% to $.2867, and promptly bounced. Therefore, a little pullback to the sub $.30 level would be a great accumulation opportunity.
The absolutely perfect retracement level would be the 61.8 at $.245- however, I don’t see it happening if the corporate momentum continues.
Q1 numbers should be great. My guess- the stock is a double from here this year. Be patient and buy the dips.
Last year’s failed idea can be this year sweetheart. NWWV is sure shaping up that way. Comments and questions are welcome.
I’ve been watching this one closely. I purchased at an average cost of $25 and sold at $32 on monday. Thank’s for the pointers. I missed the last minute spike at the end of the day but as is said “pigs get slaughtered”. I hope to get back in at $28
Editor: I believe you meant $.25 and $.32. However, well done. I feel good because I’ve helped you learn how to trade. Now, here’s the next step. If you like the company and think it has a lot of upside, buy a whole position when it is cheap, the trade around half your position. Sell half on surges, buy half on dips. That way, if it really runs away, you still have a position. I made the mistake of not following my own rules on HDY, and it cost me about $1 on 10,000 shares.
This company is big scam- I’m sure thier stocks are up they are scamming people out of money i’ve tried for three months to cancel a free “trial membership” to witch I never recieved any kind of info. about the company or web site, and I am still being charged on my credit card for services I have never used and tried to cancel! I would not recomend this company to anyone!!
Editor: Sorry you are having a difficult. However, here’s what I don’t understand. How can you say you didn’t sign up if they have your credit card number? I have signed up for many trials, but if I give my credit card number I know exactly what I am doing. Are you saying they stole your credit card number. I’m sure you will work it out. I have studied the financials, and they give substantial rebates every quarter to those who don’t want to use the service.
Best Editor, As a doctor in economics/finance I always looking for progress in fundamentals. When I’am investing in penny stocks I invest in the low risk catagory. I bought 2k shares one year ago but I didn’t sell, because I simply knew this company will bounge back. Now I own approx. 10K shares. This market has unbelievable potential. I can know because I’am an corporate adviser in a similar company in the Netherlands. Keep publishing the good news. I’ll speak you soon. Greetings Remco Lunding, Netherlands
Editor: Doctor, based on the company’s reported corporate performance yesterday, I believe this patient is going to get healthy in a hurry.