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Subject: RE: [CANSLIM] Our Very Own Tom Worley Makes the Big TIme!!
Date: Fri, 11 Jan 2002 07:57:06 -0500
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Although I mostly lurk here, I have to add my congratulations too.
Tom, Katherine and many others here provide intelligent discussions that
make this a truly valuable message board, which I find to be rare in the
world of online investing information.
Congratulations Tom and THANKS.
- -----Original Message-----
From: Katherine Malm [mailto:kmalm@earthlink.net]
Sent: Thursday, January 10, 2002 7:50 PM
To: canslim@lists.xmission.com
Subject: [CANSLIM] Our Very Own Tom Worley Makes the Big TIme!!
Once again, CONGRATULATIONS!!! --Katherine
The Smart Investor
Thursday, January 10, 2001
View IBD <http://www.investors.com/editorial/testimony01.asp?v=1/10>
Investor Profile archive.
Bringing Market Direction Into The Mix
BY CLAIRE MENCKE
INVESTOR'S BUSINESS DAILY
Even folks who think they've paid their dues in investing can learn a lot
from CAN SLIM, Tom Worley says.
Worley, a bank operations manager, might have thought he'd seen it all. He
started investing when he was 10.
"My uncle worked for Florida Steel," he said. "It was publicly traded then,
but it still wasn't profitable. He gave my siblings and I one share each for
Christmas."
For Worley, it was the gift that kept on giving.
"Back then, there wasn't much junk mail," he said. "So a 10-year-old like me
treasured any mail received. When the quarterly report or annual statement
with proxy arrived, I devoured it."
The share also got him into analyzing stocks.
"I made my first financial forecast about a year later when I told my uncle
the company would be profitable in six months," said Worley. "That was about
a year ahead of what the company accountants were expecting. I was right and
they were wrong."
Worley, now 53, took from that much of the approach to stocks that he still
uses.
"It's probably one reason I became so based in fundamentals," he said. "I
have tried everything pretty much, from value investing and bottom fishing
to momentum. I'm basically a fundamentalist at heart."
_____
<http://www.investors.com/images/editimg/Edu0110.gif> Image: A Marathon
Run
_____
Fundamentals were what drew him to Epiq Systems ( EPIQ). Worley first bought
shares of the financial software firm in early 1999, and still owns a
position in it.
Three years ago, Epiq had been public for just about two years and already
had shown year-over-year acceleration in sales, cash flow and earnings
growth.
But the fundamental approach wasn't without its issues, says Worley. He had
done a stint as a retail broker for a firm that underwrote small-cap
companies' shares. That introduced him to the inner workings of many
companies. But there were drawbacks, he says.
"My most frequent pre-CAN SLIM mistake was convincing myself that I
understood a company better than the market," said Worley. "Then I'd hold it
when everyone else was selling."
CAN SLIM lends a helpful counterbalance. "What it does for me is provide an
objective way of measuring a company's true fundamentals against all other
stocks in its group, as well as all stocks," Worley said. "It also provides
a healthy balance of momentum considerations against my own too-strong
fundamentals weighing."
Reason To Succeed
Worley says he aims to buy stocks of companies "that have a reason to be
highly successful over the long term." Still, CAN SLIM has great value
because "it improved my sense of timing on when to get in and get out,"
Worley said.
Small stocks still are his favorites, he says. "But size by itself isn't a
determining factor," Worley said. "My very first screen is the daily list of
stocks that hit a new high that day."
These stocks are "the starting point for finding stocks with no overhead
within 12 months," he said. "Then I examine their earnings, sales, ROE,
group strength, relative strength and EPS ratings, chart formation,
accumulation/distribution ranks and timeliness."
He wants companies to be profitable for at least two quarters.
Quarter-to-quarter "sequential earnings and sales are more important to me
than year-to-year percentage increases," he said. "If last year was a very
weak year, it's easy to generate easy percentage comparisons this year, and
hard to do the same next year if they are not still growing sequentially."
Worley says Epiq is probably his single best stock success. The company
makes software for bankruptcy trustees.
"I found this one as I find most for my watch list, by using the daily list
of stocks making new highs, and checking for their CAN SLIM
characteristics," he said.
His first purchase of the stock netted a 70% return in almost exactly seven
weeks, he says.
Worley says he tries to buy stocks that can double in price or better over a
year to 18 months. With Epiq, "I saw that potential, but the 70% in seven
weeks was too extreme," he said. He sold that position. But later, when the
stock backed down from where he had sold it, he bought it again. His second
and third purchases netted him 20% and 30% gains.
By then, Worley said he "realized the potential of a company doing so well
when the economy was still strong. If (the bankruptcy software vendor) could
do that well then, they would only flourish when the economy weakened" - as
it did.
He bought the stock a fourth time in April 2000 at about 6.75, adjusted for
splits. Ten months later, he sold half of it with a profit of around 120%.
Three months after that, he sold another quarter of the position for a 366%
profit.
Personal Rule
"I have a personal rule that I must sell at least half a position upon the
first sign of (stock price) weakness whenever I'm up over 100%," Worley
said. "Given the opportunity, I want to take my investing capital off the
table and play with someone else's money."
But Worley first uses the 20% gain rule to force himself to re-examine why
he's in a stock.
When a stock is up 20%, "it's a reason to carefully examine the chart and be
able to articulate why I was not selling it," he said.
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<DIV><SPAN class=3D020115412-11012002><FONT face=3DArial =
color=3D#0000ff=20
size=3D2>Although I mostly lurk here, I have to add my congratulations=20
too.</FONT></SPAN></DIV>
<DIV><SPAN class=3D020115412-11012002><FONT face=3DArial =
color=3D#0000ff=20
size=3D2></FONT></SPAN> </DIV>
<DIV><SPAN class=3D020115412-11012002><FONT face=3DArial =
color=3D#0000ff size=3D2>Tom,=20
Katherine and many others here provide intelligent discussions that =
make this a=20
truly valuable message board, which I find to be rare in the world of =
online=20
investing information.</FONT></SPAN></DIV>
<DIV><SPAN class=3D020115412-11012002><FONT face=3DArial =
color=3D#0000ff=20
size=3D2></FONT></SPAN> </DIV>
<DIV><SPAN class=3D020115412-11012002><FONT face=3DArial =
color=3D#0000ff=20
size=3D2>Congratulations Tom and THANKS.</FONT></SPAN></DIV>
<BLOCKQUOTE dir=3Dltr style=3D"MARGIN-RIGHT: 0px">
<DIV class=3DOutlookMessageHeader dir=3Dltr align=3Dleft><FONT =
face=3DTahoma=20
size=3D2>-----Original Message-----<BR><B>From:</B> Katherine Malm=20
[mailto:kmalm@earthlink.net]<BR><B>Sent:</B> Thursday, January 10, =
2002 7:50=20
PM<BR><B>To:</B> canslim@lists.xmission.com<BR><B>Subject:</B> =
[CANSLIM] Our=20
Very Own Tom Worley Makes the Big TIme!!<BR><BR></FONT></DIV>
<DIV>
<H2 class=3Dtxthead><FONT color=3D#0000ff>Once again, <FONT=20
size=3D7>CONGRATULATIONS!!!</FONT></FONT> <FONT =
size=3D2>--Katherine</FONT></H2>
<H2 class=3Dtxthead>The Smart Investor</H2><FONT size=3D2> <FONT =
size=3D2>=20
<P class=3Dtxtsub>Thursday, January 10, 2001</P></FONT><FONT =
size=3D2><A=20
=
href=3D"http://www.investors.com/editorial/testimony01.asp?v=3D1/10">Vie=
w IBD=20
Investor Profile archive.</A></FONT>=20
<H3><FONT size=3D3>Bringing Market Direction Into The =
Mix</FONT></H3><!--- DO NOT DELETE THIS LINK --->
<P class=3Dbyline>BY CLAIRE MENCKE</P>
<P class=3Dibd>INVESTOR'S BUSINESS DAILY</P>
<P>Even folks who think they've paid their dues in investing can =
learn a lot=20
from CAN SLIM, Tom Worley says.</P>
<P>Worley, a bank operations manager, might have thought he'd seen it =
all. He=20
started investing when he was 10.</P>
<P>"My uncle worked for Florida Steel," he said. "It was publicly =
traded then,=20
but it still wasn't profitable. He gave my siblings and I one share =
each for=20
Christmas."</P>
<P>For Worley, it was the gift that kept on giving.</P>
<P>"Back then, there wasn't much junk mail," he said. "So a =
10-year-old like=20
me treasured any mail received. When the quarterly report or annual =
statement=20
with proxy arrived, I devoured it."</P>
<P>The share also got him into analyzing stocks.</P>
<P>"I made my first financial forecast about a year later when I told =
my uncle=20
the company would be profitable in six months," said Worley. "That =
was about a=20
year ahead of what the company accountants were expecting. I was =
right and=20
they were wrong."</P>
<P>Worley, now 53, took from that much of the approach to stocks that =
he still=20
uses.</P>
<P>"It's probably one reason I became so based in fundamentals," he =
said. "I=20
have tried everything pretty much, from value investing and bottom =
fishing to=20
momentum. I'm basically a fundamentalist at heart."</P>
<HR>
<P class=3Drightboxlink><A=20
href=3D"http://www.investors.com/images/editimg/Edu0110.gif"><IMG =
height=3D15=20
src=3D"http://www.investors.com/images/editimg/chart.gif" width=3D15=20
border=3D0> Image: <U>A Marathon Run</U></A></P>
<HR>
<P>Fundamentals were what drew him to Epiq Systems (<A=20
=
href=3D"javascript:popup=3Dwindow.open('http://www.investors.com/smartse=
lect/SmartSelect.asp?x=3DG3S4M5V6','SmartSelectPop','width=3D610,height=3D=
420,directories=3Dno,status=3Dno,location=3Dno,toolbar=3Dno,scrollbars=3D=
no,resizable=3Dyes,menubar=3Dno,copyhistory=3Dno,alwaysRaised=3D0,depend=
ent=3Dno');popup.focus();">EPIQ</A>).=20
Worley first bought shares of the financial software firm in early =
1999, and=20
still owns a position in it.</P>
<P>Three years ago, Epiq had been public for just about two years and =
already=20
had shown year-over-year acceleration in sales, cash flow and =
earnings growth.=20
</P>
<P>But the fundamental approach wasn't without its issues, says =
Worley. He had=20
done a stint as a retail broker for a firm that underwrote small-cap=20
companies' shares. That introduced him to the inner workings of many=20
companies. But there were drawbacks, he says.</P>
<P>"My most frequent pre-CAN SLIM mistake was convincing myself that =
I=20
understood a company better than the market," said Worley. "Then I'd =
hold it=20
when everyone else was selling."</P>
<P>CAN SLIM lends a helpful counterbalance. "What it does for me is =
provide an=20
objective way of measuring a company's true fundamentals against all =
other=20
stocks in its group, as well as all stocks," Worley said. "It also =
provides a=20
healthy balance of momentum considerations against my own too-strong=20
fundamentals weighing."</P>
<P><B>Reason To Succeed</B></P>
<P>Worley says he aims to buy stocks of companies "that have a reason =
to be=20
highly successful over the long term." Still, CAN SLIM has great =
value because=20
"it improved my sense of timing on when to get in and get out," =
Worley=20
said.</P>
<P>Small stocks still are his favorites, he says. "But size by itself =
isn't a=20
determining factor," Worley said. "My very first screen is the daily =
list of=20
stocks that hit a new high that day."</P>
<P>These stocks are "the starting point for finding stocks with no =
overhead=20
within 12 months," he said. "Then I examine their earnings, sales, =
ROE, group=20
strength, relative strength and EPS ratings, chart formation,=20
accumulation/distribution ranks and timeliness."</P>
<P>He wants companies to be profitable for at least two quarters.</P>
<P>Quarter-to-quarter "sequential earnings and sales are more =
important to me=20
than year-to-year percentage increases," he said. "If last year was a =
very=20
weak year, it's easy to generate easy percentage comparisons this =
year, and=20
hard to do the same next year if they are not still growing =
sequentially."=20
</P>
<P>Worley says Epiq is probably his single best stock success. The =
company=20
makes software for bankruptcy trustees.</P>
<P>"I found this one as I find most for my watch list, by using the =
daily list=20
of stocks making new highs, and checking for their CAN SLIM =
characteristics,"=20
he said.</P>
<P>His first purchase of the stock netted a 70% return in almost =
exactly seven=20
weeks, he says.</P>
<P>Worley says he tries to buy stocks that can double in price or =
better over=20
a year to 18 months. With Epiq, "I saw that potential, but the 70% in =
seven=20
weeks was too extreme," he said. He sold that position. But later, =
when the=20
stock backed down from where he had sold it, he bought it again. His =
second=20
and third purchases netted him 20% and 30% gains.</P>
<P>By then, Worley said he "realized the potential of a company doing =
so well=20
when the economy was still strong. If (the bankruptcy software =
vendor) could=20
do that well then, they would only flourish when the economy =
weakened" — as it=20
did.</P>
<P>He bought the stock a fourth time in April 2000 at about 6.75, =
adjusted for=20
splits. Ten months later, he sold half of it with a profit of around =
120%.=20
Three months after that, he sold another quarter of the position for =
a 366%=20
profit.</P>
<P><B>Personal Rule</B></P>
<P>"I have a personal rule that I must sell at least half a position =
upon the=20
first sign of (stock price) weakness whenever I'm up over 100%," =
Worley said.=20
"Given the opportunity, I want to take my investing capital off the =
table and=20
play with someone else's money."</P>
<P>But Worley first uses the 20% gain rule to force himself to =
re-examine why=20
he's in a stock.</P>
<P>When a stock is up 20%, "it's a reason to carefully examine the =
chart and=20
be able to articulate why I was not selling it," he said.=20
</P></FONT></DIV></BLOCKQUOTE></BODY></HTML>
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