Briefly Speaking ...

07/16/2004 12:00 am EST

Focus:

Here, we offer an eclectic mix of ideas: US Global's Frank Holmes offers a trio of favorites; Ken Kam looks at healthcare; Steven Hochberg provides a outlook based on Elliott Wave Theory;  Bryan Perry looks at a gas driller; and Kevin Kennedy says, "cheese"!

Holmes, FrankFrank Holmes, chief investment officer with US Global Investors was recently interviewed on CNBC by Louisa Bojesen and Tyler Mathisen. Here are some highlights: "Ivanhoe Mines (HUGO NASDAQ) is one of our favorites. There's three metrics we're looking at in a mining company: growth in reserves, growth in production, and growth in cash flow. Ivanhoe has the largest piece of real estate in Mongolia, with massive copper and gold potential. San Juan Basin Royalty Trust (SJT NYSE) is an income trust in our resource fund. We like it because it is a hedge against gas prices. And it pays a monthly dividend and as gas prices rise, the dividend increases each month. Legg Mason (LM NYSE) is in the Holmes Growth Fund. The firm is capitalizing on the secular growth bull market that we think will take place in the second half. Legg Mason has intellectual capital, with a fantastic group of money managers."

Kam, KenKen Kam, manager of the Masters 100 Fund, has added positions in a trio of healthcare stocks. He notes, "We've been buying a healthy amount of Kos Pharmaceuticals (KOSP NASDAQ). The company focuses primarily on products for chronic cardiovascular and respiratory diseases. More recently, Kos has been aggressively acquiring and defending multiple patents, which we see as a sign of management strength. Kosan Biosciences (KOSN NASDAQ) is a biotech company involved in research and discovery of drug candidates for diseases such as cancer. Kosan is a small cap with a couple of drug candidates currently undergoing mid-stage clinical trial studies.  Axcan Pharmaceuticals (AXCA NASDAQ) maintains a portfolio of treatments aimed at gastrointestinal diseases and disorders. Over the last month, the company has announced several positive clinical trials results which, combined with positive second quarter financial results, prompted us to buy."

Hochberg, Steven"The stair-step decline in the major stock averages should pick up speed as bearish cyclical forces intensify," Steven Hochberg, editor of The Elliott Wave Financial Forecast. "The global nature of the decline and its spread to other asset classes confirms that liquidity is drying up. Eventually, this should lead to financial instability on an unprecedented scale. Treasury yields are in a countertrend decline. Gold has fulfilled our forecast for a bounce and is now set to resume the larger bear trend. Silver is also near another decline. Overall, investors are right back where they were at the start of the bear in 2000 when 'booming corporate profits' was the reason that stocks were supposedly set to soar. Today's 'good news' is now an easy call for most pundits and investors. They are putting their financial security in the hands of the 'news'. We'll side with the market and our Wave Principle, which say that this time, many will be wiped out on the same type of bet that went bad in 2000."

Perry, Bryan"We are going to increase our weighting in the energy patch, where there continues to be strong money flow," says Bryan Perry, editor of The Tactical Trader. "The gas sector is technically very strong, displaying excellent relative strength. I believe our latest trading pick- Petroleum Development Corp. (PETD NASDAQ) will deliver earnings in early August that will just hit it out of the park. The company is an independent energy firm, operating more than 2,500 wells located in the Appalachian basin, Michigan, and the Rocky Mountain Region. PETD is one of Fortune's 100 Fastest Growing Companies and is also one of Investors Business Daily's IBD 100, representing stocks that have strongest earnings growth and the best relative strength. This gives the stock a lot of exposure and attracts all kinds of trading money. Technically, the stock is poised to rally strongly."

Kennedy, Kevin"Lucille Farms (LUCY NASDAQ) is a New Jersey-based manufacturer and marketer of low-moisture mozzarella cheese, reduced-fat and non-fat, low-moisture mozzarella cheese and pizza cheese," says Kevin Kennedy, editor of The Coolcat Explosive Small Cap Growth Report. "Net income for the year ended March 31 was $209,000, or $0.07 per share, compared to a loss of $847,000, or $0.26 per share, for the prior year. A new product, 'Lucille Premium,' is a reduced-fat, low-moisture mozzarella cheese designed for health-conscious consumers seeking reduced fat and no carbohydrates. Technically, this stock has broken out to the upside, rising from a low of $0.68 to $4.95, before pulling back. LUCY is one of the latest market plays on the low-carb diet craze. With a tiny $10-million market cap and a small float, it may still have more room to move."

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