At www.ValuEngine.com we show that the Basic Materials sector is 4.9% undervalued with the Chemicals-Diversified industry 5.3% overvalued and the Chemicals-Specialty industry 28.3% overvalued. All eight of the stocks in today’s table have complete ValuEngine data and we have enough price data to have most value levels, risky levels and pivots.
Aceto Corp. (ACET) – has been bouncing back and forth around $10 since the end of October 2012.
Ferro Corp. (FOE) – has been below $10 since the week of August 12, 2011.
Flexible Solutions International Inc. (FSI) – has been below $4.50 for at least five years.
Landec Corp. (LNDC) – spiked above $12 on September 27, 2012 then back below $10 since November 8, 2012.
Northern Technologies Intl Corp. (NTIC) – has been well above $10 until this week.
OMNOVA Solutions Inc. (OMN) – has been below $9.50 for at least five years.
Penford Corporation (PENX) – has been below $10 since the week of May 7, 2010.
Zoltek Companies Inc. (ZOLT) – gapped up to $15 on February 6, 2012 and has been below $10 since May 4, 2012.
Reading the Table
OV / UN Valued – The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine. The only overvalued stock in today’s table with ACET at 4.8% overvalued. All other stocks in today’s table are undervalued with FSI the most undervalued by 60.4%.
VE Rating – A “1-Engine” rating is a Strong Sell, a “2-Engine” rating is a Sell, a “3-Engine” rating is a Hold, a “4-Engine” rating is a Buy and a “5-Engine” rating is a Strong Buy. Today we have two Sell rated stocks, four Hold rated stocks and two Buy rated stocks.
Last 12-Month Return (%) – Stocks with a Red number declined by that percentage over the last twelve months. Stocks with a Black number increased by that percentage over the past twelve months! We have a tie for the biggest gains with ACET and LNDC both up by 65.7%. The biggest loser was FSI with a loss of 60.2%.
Forecast 1-Year Return – Stocks with a Red number are projected to decline by that percentage over the next twelve months. Stocks with a Black number in the Table are projected to move higher by that percentage over the next twelve months. The biggest loser is projected to be FOE with a potential loss of 8.6%. The biggest winner is projected to be OMN with a potential gain of 5.6%.
P/E Ratios – OMN has a single-digit P/E ratio. FOE has a seriously elevated P/E ratio.
Value Level: is the price at which to enter a GTC Limit Order to buy on weakness. The letters mean; W-Weekly, M-Monthly, Q-Quarterly, S-Semiannual and A- Annual.
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
Risky Level: is the price at which to enter a GTC Limit Order to sell on strength.
Where to Buy and Where to Sell
A “Value Level” is a price at which buyers should add to positions on market price weakness. A “Risky Level” is a price at which sellers should reduce holdings on market price gains. A "Pivot" is a support or resistance (Value Level or Risky Level) that was violated in its time horizon, acting as a magnet during the remainder of that time horizon. These levels are calculated in weekly (W), monthly (M), quarterly (Q), semiannual (S) and annual (A) time horizons, based on the past nine closes in each time horizon. My theory is that the closes over a nine-year period are the summation of all bullish and bearish events for that market or specific stock. These levels are the most important element of my Buy and Trade Strategy.
Buy and Trade Guidelines
Investors should consider entering good until cancelled (GTC) orders to buy weakness to a value level, or to sell strength to a risky level.