The Bowser Report is a specialized newsletter that focuses on stocks trading for under $3 per share. Here, editor Faris Sleem, reviews three of his recommended stocks that he believes still offer high potential.
While Parks! America (PRKA) has slightly pulled back since our recommendation four months ago, the stock has a bullish technical reading and fundamentals have improved.
The most recent quarterly results showed 19% year-over-year (yoy) growth in attendance-based sales. Comparable sales increased across all timeframes. Bottomline growth was small because the company allocated much more capital to advertising and general operating expenses.
The main catalysts for PRKA are increased consumer spending and a promising industry outlook. Zoos typically struggle during economic downturns, but PRKA revenue surged during the emergence of the global pandemic, and the company has generated fantastic profits as a result.
The company is on track to generate more top and bottomline growth. A significant portion of its recent growth is attributed to the acquisition of its Texas park in April 2020.
New catalysts to keep an eye out for include new park acquisitions and a potential uplisting. Since PRKA is an OTC Pink Sheet stock, the only way to go is up. Any share price under $0.60 is appealing as long as attendance-based sales do not lag.
ARC Document Solutions (ARC) went from industry laggard to leader in 2021. The ideal buying range for long-term investors is under $2.60 per share but based on the Bowser Game Plan, any dips under $3 will suffice. The company generated a second consecutive quarter of EBITDA over $11 million and net income increased to $3.2 million.
ARC is still undergoing a transformation built on consistent revenues and new growth opportunities. Its construction segment remained strong despite supply chain concerns, and its gross margin grew year-over-year.
Insider accumulation has been significant over the past year primarily due to automatic purchases from CEO Suriyakumar Kumarakulasingam. While automatic buys might seem less significant, they are more beneficial for shareholders because the insider is buying regardless of the price.
That is more reassuring for long-term holders and acts as a catalyst. The firm's consistent profits make it an appealing value investment at the right price.
Information Analysis (IAIC) has already gained 41% since our recommendation in March 2021. However, the company still offers more opportunity.
IAIC has made some vital structural changes and is setting itself up for success by improving profit margins. As long as the focus remains on driving its professional fee business, any revenue growth will cause substantial value creation.
IAIC currently has a float of 5.9 million shares, which makes the share price more volatile. Investors commonly shy away from volatility, but in this case, it could provide long-term investors with better entry points on unusual dips. Just like with ARC, any dip under $3 puts it in buying range, but anything under $2.60 provides ideal risk/reward.
Outside of its robust business model, the IAIC executive team is the biggest catalyst to create shareholder value. New CEO Jamie Benoit has hit the ground running and has plenty of experience in driving organic growth.
Benoit intends to reposition the company as a disruptive technology and commercial enablement leader in the government and global private sector verticals.
Additionally, Tim Hannon was appointed as CFO, bringing an abundance of experience to the table. With its new management team, potential uplisting and higher profit margins, IAIC is in a great position to capture market share.
We believe all of these stocks offer unique opportunities at the right price. Overall, as long as you maintain focus on the underlying companies and do not overpay, there are still plenty of promising opportunities in this market.