Posts Tagged ‘bargain stocks’

Buzz Stock of the Day – Crosstex Energy, Inc. (XTXI)

Wednesday, June 24th, 2009

Shares of Crosstex Energy, Inc. (Nasdaq: XTXI) were up more than 22 percent today.

Earlier this month, the Dallas-based natural gas transportation and processing company announced an agreement to sell its assets in Mississippi, Alabama and South Texas for $220 million to Southcross Energy LLC. Crosstex’s assets in Mississippi and ALabama consist of about 780 miles of intrastate gathering and transmission pipelines. The South Texas assets consist of about 1,400 miles of intrastate gathering and transmission pipelines.

Proceeds from the sale will be used to pay down more than $200 of the partnership’s debt. This will satisfy the targets for debt reductions in Sept. 2009 and Dec. 2009 established in recent amendments to its debt facilities, Crosstex said in a statement.

“The sale of our Mississippi, Alabama and South Texas assets enables us to strengthen our balance sheet as we pursue our strategy to increase liquidity, reduce leverage and improve profitability,” said Crosstex president and CEO, Barry E. Davis in a news release. “We continue to focus on the growth of our strategic assets in North Texas and Louisiana, as well as our treating business, and remain committed to being a premier provider of midstream energy services.”

More than 92 percent of Motley Fool’s CAPS members believe the stock will outperform the S&P 500 this year.

The Energy Information Administration, in its Annual Energy Outlook 2004, estimates that natural gas demand in the United States could be 31.41 Tcf by the year 2025. That is an increase of 38 percent over 2002 demand levels.

The EIA expects residential energy demand to increase 25 percent between 2002 and 2025. Residential use of natural gas is expected to increase by 1.5 percent per year from 2002 to 2010 and 0.9 percent from 2010 to 2025, increasing 25.5 percent from 2002 to 2025. Residential natural gas consumption accounts for 22 percent of all consumption in the U.S.

Probably the most important long term driver of natural gas demand in the residential sector is future residential heating applications. Between 1991 and 1999, 66 percent of new homes, and 57 percent of multifamily buildings constructed used natural gas heating. In 2003, 70 percent of new single family homes constructed used natural gas. While these new homes being built are generally increasing in size, the increasing efficiency of natural gas furnaces used to heat them compensates for the increased square footage to be heated. In general, however, the increase in the number of new homes using natural gas for heat over the next 20 years is expected to provide a strong driver for residential natural gas demand.

Buzz Stock of the Day – Smith and Wesson (SWHC)

Friday, June 19th, 2009

Shares of Smith and Wesson Holding Corp. (Nasdaq: SWHC) ended the day 22 percent higher on eight-times the gunsmith’s average three-month volume after the company announced $99.5 million in fourth-quarter revenue. The 20 percent boost over the same period last year was above analysts’ forecast of $90.8 million, according to Thomson Reuters.

“Demand for our handguns and tactical rifles remained strong throughout the fourth quarter, as evidenced by our revenue as well as by our backlog balance,” the company said in a statement.

The company is also adding a new stream of revenue to its arsenal. On Thursday, Smith and Wesson Holding Corp. announced a deal to acquire Universal Safety Response, a privately held maker of barriers, gates and other perimeter security related equipment, for $52.5 million in cash and stock.

In a recent news release, Smith and Wesson stated that the deal should bring in revenue of $100 million next year and generate EBITDA of $15 million.

According to a recent report by the Dow Jones Newswires, first-time gun buyers, it’s been said, have rushed to buy firearms ahead of the new administration’s assumed tougher stance on gun-control laws.

The company will release full results for the quarter on June 22, after the market closes. Analysts are looking for earnings per share of 9 cents.

Buzz Stock of the Day – GeoPharma, Inc. (GORX)

Tuesday, June 9th, 2009

Shares of GeoPharma, Inc. (Nasdaq: GORX) were up as much as 155 percent at mid-day today.

Despite a 28 percent decrease in third quarter revenues, CEO Mihir Taneja said that the company is confident that it will “end the 2009 fiscal year on a high note” primarily because of the addition of new manufacturing contracts and the emergence of its pharmaceutical business.

Pharmaceutical revenues for the nine months ended December 31st were $1.1 million, a 2722 percent increase over the same period in 2007.

CFO, Carol Dore-Falcone stated that the company hopes to “achieve break even on a cash basis in the final quarter of 2009 fiscal year ending March 31, 2009, and to see continued improvements in our financial results thereafter.”

Earlier this year, the company announced the sale of its majority ownership in its ovarian cancer business for about $2.5 million in cash, and a minority stake in the business, allowing the company to strengthen its financial position and ease “the burden of funding our ovarian cancer business segment,” Taneja said. GeoPharma will still remain a significant partner in the business, with a 40 percent stake.

GeoPharma has three main market segments:

  • Specialty Pharma, which specializes in the formulation of generic drugs for human and veterinary usage and the development of medical devices used by oncologists and other medical professionals.
  • Manufacturing, which manufactures generic drugs nutraceuticals, cosmetics and functional food products
  • Distribution, which packages and distributes the company’s products

In September 2008, Green Coast Capital issued a 12-month price target of $5.00 on GORX, citing the company’s well-defined growth strategy, and FDA approval of its new Largo, FL Cephalosporin facility for the production of the antibiotic, Cephalexin.

Green Coast’s valuation was based on applying a standard 5x gross profit valuation multiple to the company’s current fiscal year gross profit forecast of $20.6 million, and subtracting the company’s current debt of $26.7 million.

Buzz Stocks of the Day – Aeterna Zentaris (AEZS), Keryx Biopharmaceuticals (KERX)

Monday, June 1st, 2009

Shares of Canadian biotech firm, Aeterna Zentaris, Inc. (Nasdaq: AEZS) were up as much as 35 percent in mid day trading today after its partner, Keryx Biopharmaceuticals, Inc. (Nasdaq: KERX) announced positive Phase 2 data from its cancer treatment perifosine (KRX-0401), an Akt-inhibitor compound that is used as a treatment for colon and kidney cancer.

Perifosene is in-licensed by Keryx from Aeterna Zentaris.

The data was presented over the weekend at the American Society of Clinical Oncology Annual Meeting. The poster #4081 entitled, “Randomized Phase 2 study of perifosine in combination with capecitabine versus capecitabine alone in patients with second- or third-line metastatic colon cancer”, showed that perifosine combined with capecitabine, more than doubled time to progression versus capecitabine plus placebo with a statistically significant p-value. In addition, perifosine plus capecitabine more than doubled the Overall Response Rate and almost doubled the Clinical Benefit Rate versus capecitabine plus placebo.

Aeterna Zentaris’ annual revenues during the last years have been in the range of $35 million to $40 million, coming from sales of marketed products, license agreements and services.

In March 2009, the company signed a collaboration agreement with leading pharmaceutical company, Sanofi-Aventis (NYSE: SNY) for the commercialization of the company’s lead compound, cetrorelix, which is used in treating benign prostatic hyperplasia (BPH), a benign enlargement of the prostate.

“The agreement provided us with an upfront payment of $30 million, bringing the total of our non-dilutive funding over the last 18 months to roughly $100 million,” said Aeterna Zentaris CEO, Juergen Engel Ph.D, in a recent interview.

Join the discussion on our Buzz Stocks Board, and find out what other investors think about AEZS.

Buzz Stock of the Day- Lifetime Brands (LCUT)

Wednesday, April 1st, 2009

More than 2,000 exhibitors from 30 countries attended this year’s International Home & Housewares Show in Chicago.

A lot of players in the industry, including Jeff Siegel, CEO of Lifetime Brands, Inc. (Nasdaq: LCUT) — our Buzz Stock of the Day — are actually upbeat and claim that “in difficult times, innovation is an indispensable tool.” And frugality Siegel said is actually an impetus for sales for companies like Lifetime Brands. Sales for some specific houseware categories were actually up in 2008, despite an overall decline in retail sales, according to NPD Group.

“As people eat more at home, they need to acquire the products that enable them to prepare, cook, and serve food at home,” Siegel said. The beauty of many of Lifetime Brands’ products is that they’re cheap– many under $100 — making them a viable purchase for consumers.

Lifetime Brands markets cutlery, kitchen tools, gadgets, and other products under the KitchenAid, Cuisinart and Farberware brands at retailers nationwide.

The company recently partnered with Edison Nation, a product consultant, to solicit ideas for new products from consumers.

“It’s a win-win situation because it offers excitement that people need in this tough environment. And Lifetime gets additional innovative items that we can turn into positive sales,” said Dan Siegel, executive vice president of corporate innovation strategies for Lifetime Brands. “

“People are spending more time at home,” Tom Mirabile, a vice president and trend analyst for Lifetime Brands told Reuters. “We have to help them find ways to make that experience interesting.”

Lifetime Brands reported revenue (ttm) of $486.3 million, and generated EBITDA of $17.6 million. The company has a 1.3 percent operating margin, and generated $40.8 million in operating cash flow and $11.8 million in levered free cash-flow. Shares of LCUT trade slightly above their 50-day moving average.

Join the discussion on Lifetime Brands on the company’s official Buzz Stock thread.