Re: [CANSLIM] BRLI

From: "Tom Worley" <stkguru@bellsouth.net>
Subject: Re: [CANSLIM] BRLI
Date: Tue, 26 Mar 2002 23:40:58 -0500
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Ian,

From both a personal and philosophical viewpoint, I completely agree. From a
risk management standpoint (which is very much a part of CANSLIM), I must
disagree.

While I personally screen for stocks from $2-20 (just raised from 2-18),
anything under at least $15 is not "mainstream" CANSLIM. A few years ago,
WON changed his advocacy from a $12 threshold. And about five years ago, WON
changed his focus on "S" to include mid and even large cap stocks, because
that was where the funds and other institutional money managers were placing
their bets. And momentum is certainly an undeclared part of CANSLIM. For
some years now, micro and small cap stocks were virtually excluded from the
apparent consideration of WON, even though many in this size, and price,
category would still manage to make it into the DG books. I do agree, none
of the 7 letters of CANSLIM speak to price or volume, but HTMMIS does
address this, as has the 24 lessons.

Ian, both you and I have experience, and success, at playing the high risk
arena of lower priced micro and small cap stocks. But they definitely are
not for many / most investors. They are volatile, and when they work, they
can make you high double digit percentage returns very quickly. When they
don't work short term, they can easily give you a 10-15% loss, enough to
shake out most investors.

BRLI has popped on my screens many times, and so far I have yet to buy it,
even with VR funds. Mostly what stopped me was the relatively flat sales,
but with earnings that were erratic by comparison. Never did a full due
diligence on it, so don't know the explanation, just went of to find better
candidates in industry groups I preferred.

Tom Worley
stkguru@bellsouth.net
AIM: TexWorley
- ----- Original Message -----
From: "Ian" <ianstm@shaw.ca>
To: <canslim@lists.xmission.com>
Sent: Tuesday, March 26, 2002 6:43 PM
Subject: Re: [CANSLIM] BRLI


Actually, if you just go through the letters in CANSLIM, there is nothing in
them about price or volume :)

I consider myself a true-blue f'fundamental' CANSLIM investor - looking at
revenue and earnings growth, strong margins, some new product/service/market
that is about to ramp the companies forward EPS, lots of demand and limited
supply, companies leading their market and institutions jumping on board.
(Where I differ from the "norm" is that I also like to see a low relative
historical valuation, and I don't care as much about price or starting ADV -
but I care a LOT about volume changes once the stock starts moving.)

Because the low price stocks tend to trade at much lower valuations, they
are MUCH more resistant to getting dragged down with 'M", so I can
underweight it - but you have to be very careful about only buying strong
sectors.

IMHO, most current IBD CANSLIM stocks are grossly negligent in their
complete dismissal of the original 'S' criteria.  Microcaps can kick you in
the back of the head telling you that 'S' is about to propel them upwards.
Look at the volume on NBSC from Feb 13 onwards. The increase from its
week-earlier ADV is an order of magnitude. When the stock is cheap, hitting
new highs, growing with strong EPS and a sound outlook ... and that kind of
'S' picture suddenly emerges, the stock has nowhere to go but up.

My experience is that my percentage of winning stocks appears to be way
higher doing it this way than if I just jumped on volume breakouts of $16+
80 80.  The main problem doing it my way is that I end up with far fewer
candidates in a given timeframe.

My 2 cents.


Cheers,

Ian




- ----- Original Message -----
From: Bill Triffet <btriffet@earthlink.net>
To: <canslim@lists.xmission.com>
Sent: Tuesday, March 26, 2002 2:10 PM
Subject: Re: [CANSLIM] BRLI


> To echo Tim's comment: one of the refreshing things about canslim (and
this
> group) is the restraint from "fortune telling". Bottom line: it's still
> under canslim radar. If you bought today then how do you apply the proper
> sell rules now? Stocks under $10 bucks historically can swing huge
> percentages.
>
> If your new to canslim, read HTMMIS (at least once) then wait for the
issues
> that meet the basic requirements. It will save you MUCH anguish. Trust me
on
> this! (g)
>
> -Bill
>
>
>
>
>
> ----- Original Message -----
> From: <AlpineTap34@aol.com>
> To: <canslim@lists.xmission.com>
> Sent: Tuesday, March 26, 2002 12:20 PM
> Subject: Re: [CANSLIM] BRLI
>
>
> > it will
> >
>
>
> -
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