Universal Capital: Blown Out and Ready To Rally

Admittedly, UCMT was one of the few bad ideas I have shared with OTC Journal members in a long time. At least in the short term, the stock has trade atrociously. This is a very thinly traded stock, and as such is subject to big price swings on very little volume.

Nevertheless, I believe this one will eventually be embraced by microcap investors. It might take a huge win in their portfolio, but this stock is absurdly undervalued and underfollowed.

Their year end audited numbers are due out by the end of July, and I believe they are going to be very good.

Here’s the chart, and you can see just how poorly the stock has done in the summer sell off period:

ucmt1.gif

As you can see, UCMT traded very poorly pretty much out of the gates. Apparently, there was an appetite to sell, and despite the limited volume, the sellers don’t seem too concerned about the price at which they sell.

However, of late the supply seems to have dried up completely. The stock appears to be firming, and could be one heck of a great buy right now.

Thinly traded stocks can give a lot of ground on light volume, but they can make it up as quickly to the upside.

Year end audited numbers are due out by the end of July, and I believe you are going to see a very healthy company.

If you didn’t sell when the stock hit the SSL, it simply means you have decided to become a longer term investor. With this one, a little buying could go a long way.

The bottom appears to be in. I suggest being a buyer.

Comments and questions are welcome.

11 thoughts on “Universal Capital: Blown Out and Ready To Rally

  1. I remember you commenting that UCMT spins off stock to shareholders. This was the tipping point in the scale. Will they spin off stock? Also, I got in at $1.71 and was way too optimistic during its descent. I am just trying to decide how much of long term investor I should be. If there are stocks on the way, I can wait!

    Editor: They will occasionally spin off shares of their holdings to shareholders. They have done so in the past. I can’t say when it will be. We will know a lot more about where we stand next week.

  2. Can you give me a couple comparible stocks to UCMT. I know they have some good companies in there portfolio. TDON seems to have unbelievable technology they are working to commercialize and TXEG seems to be a strong company in growth mode. Im hoping one of them will be this big hit you are speaking of. Am I drinking the kool-aid too soon on this stock or is it as stong as other companies like

    Editor: There are only 2- UTK on AMEX and TINY on NASDAQ- they both trade at much higher multiples to NAV.

  3. Do you know if this company is actively doing anything? It seems that Extreme home theaters is their only holding making any news these days.

    Editor: Behind the scenes, the company is extremely active on both new companies in their portfolio and raising a huge amount of capital from some very sophisticated sources.

  4. When can we see some improvement in UCMT.
    Obviously I am a long term player on this – whether I wanted or not – however, all this considered, the stock price on this one is way below all anticipations.
    Please advise.
    Michael

    Editor: Not much point in delivering commentary on the company at this point as it is the end of August, and there is nothing going on worth reporting. I suspect some updates will start coming out by mid September. There is a fair amount going on at the company. The stock just needs to catch on.

  5. This stock turned out to be a dog with flees. It is now past mid Sept.

    Time to hold my nose and jump? Or any prospects for the near future.
    Thanks
    M.

    Editor: No question. I have a call into the CEO to find out if he plans to have anything to say. If not, gotta move on at some point. Some of the other recent ideas- SPKL,AAPL, CREE are doing very well. You can’t hit them all.

  6. Further on your response, “you can’t hit them all” this is supposed to be a ‘small cap’ low price Journal, as I understand. Perhaps I am just missing something.

    I don’t think CREE (based on the cost per share) fits into that framework, and I know
    for sure that AAPL does not.
    And SPKL is too soon to tell.

    Further, some of your other recommendations i.e. — NCNC, CPNE, PLHI,EFSF,NIHK are not bringing in the bacon at this point in time.

    Maybe it is time for updates on some of these ideas?

    Just one man’s opinion.

    Respectfully,

    M.

    Editor: Have you forgotten to mention I was all over CPNE this time last year at $.50? Made $3.50 in January. How about PNWIF one year ago at $1.80- went to $5. NIHK- all over it this time last year at $.05- went to $.24- EFSF was first featured in January at $.18- went to $.47- Check the charts and the archives- it’s all there. PLHI was the exception- however, when the dividend was paid I told readers it was optional to hold. Lots of these small stocks trade poorly in the summer months as I have pointed out extensively. and, by the way, what’s wrong with making money in larger cap stocks when I provide the idea? How could you possibly complain about that. The one that will probably turn pretty soon is NCNC. And-you fail to mention TTGL which made a new all time high a couple of weeks ago.

  7. I agree, TTGL is impressive. You are correct there.

    I only have been a follower of your journal for less than a year, so some of these opportunities price wise didn’t work for me.

    On those I went with your ongoing comments on the blog in order to take advantage of some opportunites, as opposed to your original prices.

    Frankly, my big concern is UCMT which I had mentioned earlier, as I have a big position there.

    I will await an update on that one.

    Respectfully,
    M.

    Editor: UCMT has admittedly been a bad idea- so far- I have been swapping calls with the CEO of late to discuss getting back on track, and fully expect to get together with him next week and provide and update for everyone and some thoughts about where we are.

  8. Any update on UCMT yet?

    Regards,
    M.

    Editor: Not yet. Should be able to get with them next week.

  9. Thanks for the new ideas. I really like the Pickle.
    I did some research on one of UCMT’s portfolio companies, Third Order Nanotechnologies (TDON). Looks (to me) that they have a discovery that could be huge. Since I’m fairly new at Micro Cap investing I would appreciate your opinion when you get to talk to the folks at UCMT.
    Thanks

    Editor: I did speak with the CEO of UCMT yesterday. They are very limited as to what they can do as they are technically a fund, and I am thinking of formally dropping them as they can say very little. This is not a reflection on the fund moving forward- it is doing great. However, I am having a call with the CEO of TDON as he claims the company has extraordinary technology, and would be a good one to look at for OTC Journal subscribers.

  10. Did you ever have the call with the CEO of TDON?

    Editor: Yes- he believes his stock is going to $10. A little full of himself, but interesting technology.

  11. Hi Larry
    Back in Oct. I sent a blog comment in referrence to UCMT a company you are no longer following.
    It referred to a company that UCMT had made an investment in-TDON. TDON has since changed its name. New ticket symbol is LWLG. I did buy (TDON) LWLG at that time, but please don’t consider this an attempt to pump. You stated that (TDON) LWLG might be a good following for OTC Journal subscribers. Its been a triple since Oct. and looks like it has hugh potential. Might be worth another look. Thanks Ed C

    Editor: I knew there was going to be something to that one. Darn- we should have followed it. They have some sort of unique technology in nano technology. Glad to hear you own it. Will have another look. Any triple in this market environment is nearly a miracle.