Go to Jeff Salisbury LWGate Home Page.From: Spencer48@aol.com
Subject: Re: [CANSLIM] Rotation from value to growth on small caps
Date: Wed, 24 Apr 2002 13:33:29 EDT
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Regarding Ian's 4/19/02 E-mail below, IBD had a front page story today
(4/25/02) entitled "Stocks In Best Groups Keep Their Momentum With Great EPS
Gains."
I found it to be a very good article in whole, but as relating to what
Ian referred to (the upswing in the small caps as compared to the three
indexes IBD focuses on (Dow, S&P 500 and NASDAQ) here is what it says:
" "When there still is some uncertainty about how strong the recovery is
going to be, we think that causes people to still be valuation conscious,"
[said Gary Tapp, analyst with SunTrustRobinsonHumphrey.] "That would push
you again back toward the more reasonably valued small and mid-cap
companies," [Tapp added]. [Later on in the article, he added], "We're coming
out of a recession-many companies are beating only lowered estimates....
Because of valuations in the growth sector being already high, if [companies]
are not beating (estimates) by a wide margin the stock (doesn't get a boost)."
jans
In a message dated 4/19/2002 11:43:18 AM Eastern Daylight Time,
ianstm@shaw.ca writes:
<< The smallcap growth stocks that I follow have all been on a tear since
early
March, with hardly a breather (the first 2 weeks of February were ugly for
this group). I feels like I have only had 1 or 2 red days in my VR fund in
the last 3-4 weeks. New highs every day. And at the same time, I keep
kicking myself for all the ones that I let get away - which tells me that
there are a lot to choose from.
I'm hoping it will continue - solely based on my observation that there
aren't a lot of growth stocks anywhere else. As I do my daily earnings
scans, I am finding fewer and fewer issues exhibiting the kind of solid top
and bottom line growth that I look for - most of the ones that do are small
cap growth, and they all seem to be getting warm market receptions.
Ian
>>
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