Stock of the Day
Titan Machinery Inc. (TITN)
Friday’s Closing Price: TITN - $23.97
Sector: Retail
Industry: Retail/ Wholesale Building Products
52-week Price: $9.18 - $24.09
February 25, 2008: TITN - $19.70
Three stocks are catching my eye while making multiple screens over the past couple of weeks. MTL is up over 13% in less than two weeks since I highlighted it in a post titled Basic Materials (Oil) Stocks Making New Highs
Trading momentum is paying-off in the current market environment. Swing trading breakouts making new highs on volume at least 100% larger than the average is king. It’s working so pay attention and be smart while putting on trades. MTL is no longer a buy since it has become extended but TITN and RIO may be setting up for new 52-week highs.
TITN – 22.39, solid young stock with an ideal entry point near $20 (looking good)
Fourth quarter earnings are scheduled for Monday, April 28, 2008. I would not be a buyer until after earnings are released (this event will shape my view on the stock and a potential position). Last quarter’s net income rose to $2.7 million, or 36 cents a share, from $0.8 million, or 13 cents a share, a year ago (sales increased 67% to $132 million).
My ideal accumulation area is between $19 and $22 with the best entry coming along the 50-day moving average, which seems to be providing support. The weekly chart is showing clear accumulation by institutional investors as most up-weeks are happening on larger volume while down-weeks are happening on lighter volume.
I will definitely be interested in a position since this stock has been making my nightly screens and scans since February. I have learned that the best stocks are the ones that continually make these scans (that is fact since I started investing with this method in 2001).
Potential Trade Set-up:
Entry: $21.00
Risk is set at 1.0% of total portfolio or $1,000 of $100k
Stop Loss is 10% or $18.90
Number of Shares: 476
Position Size is $10,000
Risk is $2.10
Target is unknown (too little information)
Institutional Analysis:
Held By Institutions: 42.75%
Total Held by Institutions: 62
Money Market: 43
Mutual Fund: 18
Other: 1
New Positions: 60
Positions Sold: 0
Shares Held: 7.43M
Shares Held Previous Period: 0.13M
Shares Bought: 7.3M
Shares Sold: 0
Value of Shares Bought: $134.1M
Value of Shares Sold: $0
Top Institutional holders; Shares Held:
Systematic Financial Management, L.P.; 711,600
Trafelet Capital Management L.P.; 528,500
Heartland Value Fund; 350,000
Heartland Advisors Inc.; 350,000
Wasatch Advisors Inc.; 325,000
Key Fundamental Numbers:
Market Cap.: $320.3M
Outstanding Shares: 13.4M
Float: 6.0M
P/E (TTM): 46.02x
PEG Ratio: 2.09x
EPS Growth (MRQ): 229.23%
Revenue Growth (MRQ): 66.99%
3-Yr Earnings Rate: 54%
3-Yr Sales Rate: 34%
Net Income (thousands):
FY 2007: 3,720
FY 2006: 2,746
FY 2005: 1,270
FY 2004: 164
FY 2003: 416
Revenue (thousands):
FY 2007: 292,987
FY 2006: 193,758
FY 2005: 135,781
FY 2004: 79,269
FY 2003: 54,189
Earnings:
FY 2009: $0.77
FY 2008: $0.90
Company Summary:
Titan Machinery Inc. owns and operates a network of agricultural and construction equipment stores in North America. It is a retail dealer of Case IH Agriculture equipment and a retail dealer of New Holland Agriculture, Case Construction and New Holland Construction equipment in the United States. The Company sells and rents agricultural and construction equipment, sells parts, and services the equipment operating in the areas surrounding its stores. The agricultural equipment it sells and services includes machinery and attachments for uses ranging from large-scale farming to home and garden use. The construction equipment it sells and services includes heavy construction and light industrial machinery for commercial and residential construction, road and highway construction and mining applications. In January 2008, the Company acquired Avoca Implement and Greenfield Implement, two CaseIH farm equipment dealerships in Southwest Iowa.
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