Kurtis Hemmerling submits:

A high amount of short-selling may take place in a stock for a few reasons. One may be that analysts may have lowered thier rating or earnings forecasts for a stock. Margins may be sliding and the earning potential for the company is in serious doubt. Such fiscal problems could be either short-term or long-term in nature.

Other times short-sellers will pile onto a stock that has very high-growth prospects.The stock may have high analyst ratings and strong earnings growth forecasts, but the short-sellers feel that the targets are overly optimistic. If the extremely bullish forecasts are missed in the quarterly earnings reports, the share price could quickly recede giving the short-sellers an excellent opportunity to cover.

It is this second group that we want to target. We want to find stocks that are on the rise despite a high amount of short interest. Many of these will be high-growth

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Saj Karsan submits:

Tecumseh Products (TECUA) is a Michigan-based manufacturer of compressors for a variety of applications, including air conditioners, freezers and refrigerators. The stock has taken a pounding since the recession, having fallen more than 70% from its 2008 peak.

Tecumseh trades for less than half of the company’s tangible book value. A company trading at such a hefty discount to book value is usually in deep trouble, but Tecumseh has zero net debt.

The company’s problem, however, is its profitability, as Tecumseh has operating losses in each of its last three fiscal years. But as we’ve discussed before, earnings and cash flow

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Mark Gomes submits:

The dismissive nature of Wall Street often enables great stories to remain under the radar until it’s blatantly obvious that something transformative has already occurred. As such, rather than being dismissive, I now respond with excited optimism (the thought of discovering the next stock that looks “set to triple” is nothing if not exciting!).

Pervasive Software (PVSW) seems to fit the bill. Two weeks ago, SeekingAlpha released an initiation piece entitled “Pervasive Software Shares Are Poised to Triple.” The article outlined some of the factors that will drive accelerated revenue and earnings growth for Pervasive. This article will dive deep into the company’s financial statements and examine the key factors that have kept PVSW under investors’ radar screens:

Investments in R&D have hidden PVSW’s strong underlying profitability. PVSW’s net income in fiscal 2010 was $4.1 million. Using this number, Pervasive’s PE appears to be 26. Looking at that alone, you

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Market Blog submits:

S&P
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The Smallcap Reign May Be Over

March - 31 - 2011

Market Blog submits:

S&P
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Erik Wright submits:

As many investors are aware, the Chinese RTO sector has been heavily out of favor. Among this sector stands Gulf Resources (GFRE) which has been thrown down along with the whole sector. Many investors in Gulf Resources continue to be worried about the company being revealed as a fraud. Other investors continue to have faith that this company is, in fact, different. Among investors’ worries has been the drastic movement in the stock price. The stocks drastic movement has been due to many different news releases and rumors about Gulf Resources. I hope to clarify below many of the events that have affected Gulf Resources and its shareholders. I trust this will give many shareholders a better background on the company to enable a more educated investment decision.

Company Description

Gulf Resources is the largest producer of Bromine in China. The Bromine element is quite intriguing since it has much

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Hickey and Walters (Bespoke) submit:

While we are all well aware of the equity market’s strong rally in the last couple of weeks, many under the radar stocks that aren’t

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Kapitall submits:

The following is a list of small cap stocks in rally mode, i.e. trading above their 20-day, 50-day and 200-day moving averages. In addition, all of these stocks have seen a significant increase in shares shorted, signaling an incremental skepticism of the rally by short sellers.

To compile this list we started with a universe of over 200 stocks with market caps between $100-$300M. We then sorted them by short float and looked at the change in shares shorted from January 28 to February 28. We ultimately found the 12 stocks mentioned below.

Given the significant rally of these stocks and the bearish outlook expressed by the short sellers’ positions, this may be an interesting starting point for investors looking to short overvalued small-cap stocks. On the other hand, a potential short squeeze could push some of these names higher…Full details below.

The list has been sorted by the change

Complete Story »

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