Go to Jeff Salisbury LWGate Home Page.From: Ian <ianstm@shaw.ca>
Subject: Re: [CANSLIM] DYII Revisited--post analysis
Date: Fri, 18 Jan 2002 14:08:40 -0800
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This is a multi-part message in MIME format. - --Boundary_(ID_Q7qTwM1eNkPyZ0RaUsK0Dw) Content-type: text/plain; charset=iso-8859-1 Content-transfer-encoding: 7BIT For me, DYII was a CANSLIM breakout at $11.65 (pre March 19 2-for-1split) on January 16 2001. It was a sell in the $19's (post-split) on the first big distribution day on April 17 as it neared the $20 psychological barrier. At that point it was up nearly 300% from its breakout in just 3 months. It was trading at something like 400% of its 200-day ema! I've been watching it since, but the valuation was way too high for me after that. In the microcap world, I think one has to look back to where they began and realize that there ARE valuation barriers to these things. At the recent highs, the market cap was almost $500,000,000 with less than $50,000,000 in ttm revenues. And they never kept the cash on the balance sheet - they used it for acquisitions to fuel their growth. JMHO. Ian ----- Original Message ----- From: Katherine Malm To: canslim@lists.xmission.com Sent: Thursday, January 17, 2002 9:30 AM Subject: [CANSLIM] DYII Revisited--post analysis DYII is a stock that came up for discussion on the list in early October. This is a stock that crossed my radar, but at the time I passed due to the poor chart action around 10/5. I have been watching it since and was interested in what the chart might have said prior to the failure yesterday. Here is what I saw that would have been sell signals for me: (1) 10/5/01--tail...ominous end to attempted breakout of an 11-1/2 week base. This is one of the reasons (along with due diligence) that I crossed it off the list. (2) 10/8/01--gap down just before earnings-Co. press release says "short sellers at fault" That's the goofiest reasoning I've ever heard and was a red flag that these guys don't know what they're doing. I never like a gap down just before an earnings announcement. It's a big red flag. If it happens, I'll generally wait for a bounce in the next day or 2 that begins to reverse and will sell into strength. (3) 11/26/01--Breakout from sloppy 7 wk base. So, let's say someone bought on this breakout...let's see what comes next... (4) 11/28/01--Reversal that closes below low of previous day just after B/O---I would take at least 50% off the table on this sell rule. (5) 12/10/01-12/12/01--3 days closing just at "pivot"--red flag....stock has retraced to pivot, but not a sell rule in and of itself. (6) 1/3/02--promising action on high volume--ok, this action is acceptable, might be ok afterall...but still the red flags are there...more red flags and this one should be out of the portfolio. (7) 1/8/02-1/9/02--high volume with no progress for 2 days in a row---last red flag in my book, if I'd held the last 50%, it would be gone here. (8) 1/10/02--high volume tail that closes below low of previous day--if I'd lost focus and missed the last sell, this would be the next sell signal. (9) 1/14/02--gaps down on earnings day (earnings announced after market close)--sell rule hit---if I'd lost focus and missed everything else...this would be it. (10) 1/15/02--bounces, but leaves a tail on close---last chance for the exits, a little bounce while the bargain hunters move in. Sell. (11) 1/16/02--resolution. 2:46 pm, just before market close, Herb Greenberg article at theStreet.com points out possible accounting shenanigans and goofy CEO/CFO nonresponse to income statement inquiries. If I'd missed everything else and this plunged, an open protective stop set for "catastrophic loss" would have caught this on the way down. (12) 1/16/02--Company issues response to Greenberg article after market close. I still can't figure out why a CFO couldn't have answered these questions when they were asked. Maybe he learned accounting somewhere other than the US and is still learning. A chart with comments is posted at: http://WallStreet-LLC.com/pub/DYII-PostAnal_011602.jpg Katherine - --Boundary_(ID_Q7qTwM1eNkPyZ0RaUsK0Dw) Content-type: text/html; charset=iso-8859-1 Content-transfer-encoding: 7BIT <!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> <HTML><HEAD> <META content="text/html; charset=iso-8859-1" http-equiv=Content-Type> <META content="MSHTML 5.00.3314.2100" name=GENERATOR> <STYLE></STYLE> </HEAD> <BODY bgColor=#ffffff> <DIV><FONT size=2>For me, DYII was a CANSLIM breakout at $11.65 (pre March 19 2-for-1split) on January 16 2001. It was a sell in the $19's (post-split) on the first big distribution day on April 17 as it neared the $20 psychological barrier. At that point it was up nearly 300% from its breakout in just 3 months. It was trading at something like 400% of its 200-day ema!</FONT></DIV> <DIV> </DIV> <DIV><FONT size=2>I've been watching it since, but the valuation was way too high for me after that. In the microcap world, I think one has to look back to where they began and realize that there ARE valuation barriers to these things. At the recent highs, the market cap was almost $500,000,000 with less than $50,000,000 in ttm revenues. And they never kept the cash on the balance sheet - they used it for acquisitions to fuel their growth.</FONT></DIV> <DIV> </DIV> <DIV><FONT size=2>JMHO.</FONT></DIV> <DIV> </DIV> <DIV><FONT size=2>Ian</FONT></DIV> <DIV> </DIV> <DIV> </DIV> <BLOCKQUOTE style="BORDER-LEFT: #000000 2px solid; MARGIN-LEFT: 5px; MARGIN-RIGHT: 0px; PADDING-LEFT: 5px; PADDING-RIGHT: 0px"> <DIV style="FONT: 10pt arial">----- Original Message ----- </DIV> <DIV style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black"><B>From:</B> <A href="mailto:kmalm@earthlink.net" title=kmalm@earthlink.net>Katherine Malm</A> </DIV> <DIV style="FONT: 10pt arial"><B>To:</B> <A href="mailto:canslim@lists.xmission.com" title=canslim@lists.xmission.com>canslim@lists.xmission.com</A> </DIV> <DIV style="FONT: 10pt arial"><B>Sent:</B> Thursday, January 17, 2002 9:30 AM</DIV> <DIV style="FONT: 10pt arial"><B>Subject:</B> [CANSLIM] DYII Revisited--post analysis</DIV> <DIV><BR></DIV> <DIV>DYII is a stock that came up for discussion on the list in early October. This is a stock that crossed my radar, but at the time I passed due to the poor chart action around 10/5. I have been watching it since and was interested in what the chart might have said prior to the failure yesterday. Here is what I saw that would have been sell signals for me:</DIV> <DIV> </DIV> <DIV>(1) 10/5/01--tail...ominous end to attempted breakout of an 11-1/2 week base. This is one of the reasons (along with due diligence) that I crossed it off the list.<BR>(2) 10/8/01--gap down just before earnings-Co. press release says "short sellers at fault" That's the goofiest reasoning I've ever heard and was a red flag that these guys don't know what they're doing. I never like a gap down just before an earnings announcement. It's a big red flag. If it happens, I'll generally wait for a bounce in the next day or 2 that begins to reverse and will sell into strength.<BR>(3) 11/26/01--Breakout from sloppy 7 wk base. So, let's say someone bought on this breakout...let's see what comes next...<BR>(4) 11/28/01--Reversal that closes below low of previous day just after B/O---I would take at least 50% off the table on this sell rule.<BR>(5) 12/10/01-12/12/01--3 days closing just at "pivot"--red flag....stock has retraced to pivot, but not a sell rule in and of itself.<BR>(6) 1/3/02--promising action on high volume--ok, this action is acceptable, might be ok afterall...but still the red flags are there...more red flags and this one should be out of the portfolio.<BR>(7) 1/8/02-1/9/02--high volume with no progress for 2 days in a row---last red flag in my book, if I'd held the last 50%, it would be gone here.<BR>(8) 1/10/02--high volume tail that closes below low of previous day--if I'd lost focus and missed the last sell, this would be the next sell signal.<BR>(9) 1/14/02--gaps down on earnings day (earnings announced after market close)--sell rule hit---if I'd lost focus and missed everything else...this would be it.<BR>(10) 1/15/02--bounces, but leaves a tail on close---last chance for the exits, a little bounce while the bargain hunters move in. Sell.<BR>(11) 1/16/02--resolution. 2:46 pm, just before market close, Herb Greenberg article at theStreet.com points out possible accounting shenanigans and goofy CEO/CFO nonresponse to income statement inquiries. If I'd missed everything else and this plunged, an open protective stop set for "catastrophic loss" would have caught this on the way down.<BR>(12) 1/16/02--Company issues response to Greenberg article after market close. I still can't figure out why a CFO couldn't have answered these questions when they were asked. Maybe he learned accounting somewhere other than the US and is still learning. </DIV> <DIV> </DIV> <DIV>A chart with comments is posted at:</DIV> <DIV><A href="http://WallStreet-LLC.com/pub/DYII-PostAnal_011602.jpg">http://WallStreet-LLC.com/pub/DYII-PostAnal_011602.jpg</A></DIV> <DIV> </DIV> <DIV>Katherine</DIV> <DIV> </DIV> <DIV> </DIV></BLOCKQUOTE></BODY></HTML> - --Boundary_(ID_Q7qTwM1eNkPyZ0RaUsK0Dw)-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email.
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