WSCI has a float of only 2.6 million shares. There are no covering analysts. There has been no insider selling on the open market since July 2007.

A little about WSCI: WSI Industries, Inc. engages in the precision contract metal machining business in the United States. It offers metal components in medium to high volumes requiring tolerances in accordance with customer specifications. WSI Industries offers its products and services primarily to the aerospace/avionics/defense industries, recreational vehicles markets, and computer components and bioscience industries.

The WSCI chart story:

Very bullish on all fronts. Looks like $11-$12 formed base is the longer-term support. P&F is giving a bullish target of: $23.50

The combination that WSCI is in the extremely hot “metals” sector (look at competitor charts of VMI, SCHN, RS) and the future IBD100 exposure could result in a $16-$17 near-term target. Also the fact that since January 1, 2008 WSCI has climbed from $5 to now over $13 and NO insider has sold any shares is telling us that they think that WSCI has more upside.

Please do your own due diligence before buying any shares of WSCI.

I usually stay away from stocks that trade under $3, but one just caught my eye. It is Universal Travel Group, ticket symbol: UTVG

Brief Description:
Universal Travel Group, through its wholly owned subsidiary, Shenzhen Yu Zhi Lu Aviation Service Company Ltd. (YZL), provides reservation, booking, travel and tourism services throughout China. The company’s primary offerings include domestic and international air ticket booking, hotel booking, leisure tourism packaging, restaurant booking for individuals, groups and corporations, and air cargo transportation. Shenzhen Yu Zhi Lu is one of the travel agency in Shenzhen, China. The company has eight company owned reservation office locations, 103 franchised locations and a call center facility. Located in the city of Shenzhen, Universal Travel Group targets the business and leisure traveler. The Company serves those traveling to and from mainland China, as well as the tourist markets of Taiwan, Macau and Hong Kong. The Company has partnerships with Chinese domestic and international airlines, including Iberia, Virgin Atlantic, Turkish Airlines and Swissair.

Basically, UTVG is the second best travel agency in China after Ctrip.com (symbol is CTRP).

The float is 33 million shares. 2007 EPS is .26 cents per share.

The company earlier today report their earnings in a 10-K, and they have showed very impressive growth from 2006-2007:

Highlights:
Margins: Up 15% (2006: 54%; 2007: 62%)
Revenue: Up 67% (2006: 10 million; 2007: $16.7 million)
Income: Up 67% (2006: $5.4 million; 2007: $9.2 million)

They are now trading at 1.2X sales, which is almost unheard of.

Here is the key – Although they have reported their earnings earlier today in their 10K, they have not released the PR yet. Also, they have a CC call on April 1 at 8:00am EST and will be presenting at the Brean Murray Investor presentation on April 3.

The chart looks like if there is a close above 1.57 (10-day), it may run-up to the 1.90 level, with 2.20 being the hard resistance.

The MACD has started to turn positive and RSI is starting to climb.

This is a risky stock, but remember this. If it goes from 1.60 to 1.90, you have a 20% profit.

Please do your own due diligence. I have initiated a small position today.

A very quick note today on New Oriental Energy & Chem Corp. ( NOEC - Nasdaq).

With the recent run in COIN (the stock has run-up from 10 to 16 in a few weeks), I looked for other companies that are in the same sector and have a very small float.

NOEC is a sister-play, which has not yet been discovered. The float is only 5.14 million shares, with the short interest being 432,000 shares (about 9%).

Notice that the short interest has been increasing and right now is at an all-time high:

A brief description of NOEC: The company engaged in the manufacture and distribution of fertilizer and chemical products. The products are distributed to markets in the Peoples Republic of China. The Companys primary business is the manufacture and sale of urea, a chemical used as fertilizer for crops and in certain manufacturing processes, including the manufacture of resin, plastic and medicine. NOEC also produces and sells methanol. The Companys other products include Ammonium Hydrogen Carbonate, which can be used as a fertilizer for crops and in the pharmaceutical and food industries. In addition, another product NOEC has developed Dimethyl Ether (DME). DME has a variety of industrial applications in the production of pesticides, cosmetics and as a refrigerant.

Earlier today, NOEC put out a press release that they are moving to the NASDAQ Global Market as of March 6. This should improve liquidity and visibility.

The chart is extremely oversold but the MACD and Stochastics are starting to rise:

I think that NOEC should not have a problem reaching $6.70, which would be a 20%+ move from here. If that resistance can be broken, $8.50 is the next area of resistance.

I have bought some shares earlier today awww.thebulltrader.comr own due diligence before making any investment.

If everything falls into place, NOEC could replicate the quick & large move that COIN has had.

While scanning for some “new” stocks, I came across SOL. That’s ReneSola Ltd, which trades on the NYSE. This is a recent IPO, which priced itself on January 29 at $13 per ADS share. The float for it is just 10 million shares.

Some background on SOL:

ReneSola, Ltd., through its subsidiaries, engages in the manufacture and sale of solar wafers and related products in the People’s Republic of China. It offers feedstock, ingots, and wafers for the solar industry. The company sells solar wafers to Chinese and international PV cell manufacturers. The Jiashan, Zhejiang company supplies thin sheets of crystalline silicon to customers including JA Solar (JASO), Motech, Solarfun (SOLF), and Suntech Power (STP). SOL primarily offers 125 mm by 125 mm monocrystalline wafers and in Q2 2007 began offering 156 mm by 156 mm monocrystalline wafers. As part of its expansion plan, SOL began producing multicrystalline wafers in Q3 2007. Solar power products that use monocrystalline cells generally yield higher conversion efficiencies. On the other hand, multicrystalline wafers are less expensive to produce and have less stringent raw material requirements. By producing multicrystalline wafers, SOL expects to realize cost synergies by utilizing some of the silicon materials reclaimable from its monocrystalline wafer production. SOL operates one of the largest solar wafer manufacturing plants in China. The co has annual ingot manufacturing capacity of 378 MW. The co plans to increase that to 645 MW by the end of 2008. The co differneitates itself by using proprietary technology to manufacture solar wafers primarily from reclaimables such as broken wafers and broken cells that are difficult to process but less expensive. SOL believes this is a major cost advantage over many of its competitors who rely on virgin polysilicon sourced from the spot market. SOL says its solar wafers are comparable in quality and performance to those made from virgin polysilicon. SOL has grown quickly since it began making solar wafers in 2005. The co is profitable and posted revs of US$152.9 mln for the 9 mos ended Sep 30, up 194% yr/yr.

SOL is the CHEAPEST solar play out there based on PE ratio. Current earnings run rate of about $1 per share (based on Q4 2007 projections of $.23 - $.27) and should earn $2 per share in 2008. If SOL had same forward PE as JASO it would be valued near $60!

Cash and inventories at about $4 per share (ADS).
SOL fair value = $4 + 30 PE X $1 current earnings run rate = $34

I think that when SOL gets noticed by the bigger players, it has a good chance to run into the $18-20 area. This company went public when the markets were not in a good mood with the solar stocks. But in recent days with the great earnings of FSLR and SPWR, these stocks are again starting to flourish

In Wednesday’s market, SOL gained over 15% on its second heaviest volume day since going public. Although the chart is “very young”, this is what we see.

Take a look at charts of JASO, AKNS, SOLF, STP, YGE and ASTI. Notice how they “suddenly exploded” upwards? I have a feeling that SOL will be doing this sometime very soon. With a float of only 10 million shares, this stock can move very fast.

Please do your own due diligence before buying any shares of SOL. I initiated my own position on Wed. Will be adding on, as it keeps climbing.

Titan Machinery owns and operates full service agricultural and construction equipment stores in North America. The Company also sells and rents agricultural and construction equipment, sell parts, and service the equipment in the areas surrounding their stores. AGRICULTURAL-related industry is extremely hot right now. Look at POT, CF, MOS charts as an example.

TITN is a recent IPO, and it has a float of only 6 million shares. There is a very tiny short-interest base, which tells us that this stock has a lot of investors that are not doubting the company. There have been NO insider sales at all, since the lock-up period of 180-days doesn’t expire until June 2008.

The chart is very good (not overbought):

I have initiated a small position earlier today and will look for a re-test of the $18.50 level soon. TITN very well reach the low $20’s in the not-too-distant future.

Please do your own due diligence before buying any shares of TITN.

Danny U. wrote in to talk about AFSI, Amtrust Financial Services Inc. I am looking at the aftermarket right now, and this thing popped 7% in AH trading. And this is on a day that the Dow tumbled 382 points. WOW.

Here are Danny’s thoughts on AFSI.

“AFSI is primarily an insurance company, but their business has almost no exposure to the subprime mortgage crisis. The stock is beat up because of the mortgage crisis, and is a steal right now at about $14. They were at $20.50 a month ago until the subprime crisis hit.

“In addition, AmTrust announced that it has no exposure to sub-prime mortgages. Virtually all of the mortgage-backed securities in the Company’s portfolio are government or agency-guaranteed.”

From what I can gather, they are trading at 3x to 4x the amount of cash they actually have on hand. Earnings this quarter were another blowout at 24 cents (expectations) vs 35 cents actual profit per share. Apparently, the market still views them as having exposure to the mortgage crisis because their stock actually went down again today even after blowing out expectations.”

Thanks Danny! Do you guys have any thoughts on Amtrust Financial?

WGDF.OB aka Western Goldfields is a Gold mining company that popped up on my technical filter today with quite an impressive symmetrical chart pattern breakout on todays close. Looking forward the company has very strong estimates for 08′ and beyond from there Mesquite mine with an estimated 160k - 170k in annual production of gold from the period of 2008 - 2015.

So given lets say an a conservative average gold price of $650. This would mean gold price doesn’t change from todays price.

at 170k ounces/year thats $110.5m annual gold sales and they’re expecting cost of sales to be $350/ounce of gold mined totaling $59.5m in COGS resulting in an attractive 46% gross margin.

WGDF’s financial condition is also very impressive as well. Currently they’re sitting on $57.1m in cash with an astonishing 21.8 current ratio compared to the gold and silver industries 2.9! As well WGDF has no long term debt they’re in a very good position to move forward with production and growth in the coming years.

Currently WGDF shows no profits or significant sales. Analysts are expecting EPS of .14 for 2008 with a high estimate of .39 on sales of 74.28m or 4457% growth from this years estimate. The Gold and Silver industry PE is currently trading at 28.5x earnings. While WGDF currently doesn’t have a postive PE ratio they have a very attractive forward PE of just 10.45x earnings meaning that price will like continue its bullish trend to become fairly valued in the industry in the future.

Today WGDF released a very positive PR announcing production ahead of schedule by 3 months which gave way to todays bullish breakout.

[quote]Western Goldfields Announces Production Ahead of Schedule by Three Months
Monday June 18, 1:31 pm ET
- Full production pulled forward to January 2008
- Prestrip mining commenced June 2007

TORONTO, June 18 /PRNewswire-FirstCall/ - Western Goldfields, Inc. (TSX:WGI, OTC BB:WGDF.OB) today announced that it has pulled forward gold production at its Mesquite Mine to January 2008, three months ahead of schedule. Estimated average annual production is 160,000 - 170,000 ounces of gold for the period 2008 - 2015. In addition, the Company announced that its prestrip mining commenced in June 2007. All currency amounts are in U.S. dollars.

ADVERTISEMENT

“This acceleration of production is very exciting news for our shareholders,” said Randall Oliphant, Chairman. “This marks an important step in the transformation of Western Goldfields from a developer to a producer - only 22 months after our management team joined the Company. The completion of our financing and entering into the forward sales program, announced on June 14th, allows us to move forward rapidly with mining and construction. We expect to realize cash flow from operations much sooner, with a full year of gold production in 2008, which should translate into enhanced shareholder value.”

Three of fourteen Terex 205-ton haul trucks have arrived at the Mesquite Mine site, along with two O&K RH 340, 45 cubic yard hydraulic shovels. The shovels are fully commissioned and one is currently operating. All other critical mining equipment has been assembled and commissioned. These steps will allow the Mesquite Mine to ramp up production quickly as additional haul trucks are delivered, commissioned and put into service.

Under this new production schedule, estimated average cost of sales has increased from $335 per ounce to $350 per ounce for the first eight years of the mine plan. This increase is due to the operating costs associated with the purchase of one additional truck, the escalating cost of employment insurance in California, and enhanced employee benefits.

Initial capital costs are estimated at $108.6 million, unchanged from previously announced estimates. The mine life was lengthened to 12 years from an initial 9-1/2 years due to the increase in gold reserves. As a result, life-of-mine capital costs have increased marginally from $112.5 million to $114.9 million, due to increased estimates for fleet rebuild costs over the extended life of the mine.[/quote]

I think this is a very attractive stock and we should be able to pull out a decent gain on this trade, i bought at 2.29

Regards,

Cameron Fous
Portfolio Manager of TheTechnicalTrader.net

Reader and regular contributor Michael B wrote in to talk about AFSI.

“Today I am writing you about AFSI, AMTRUST FINANCIAL SERVICES. It has potential to even become the new #1 if it runs high enough to bring its RS strength number from 97 to 99 on the IBD ranking system.

The stock chart for AFSI is very impressive:

The float is around 25 million shares, with 5% of it sold short.

I think that AFSI has a decent chance of getting up to the $18-$19 level during the next few weeks. Getting itself onto the IBD100 list at the very near top should definitely make the stock more popular.

Please do your own due diligence before putting any of your money into this or any other stock mentioned by me. For the record, I have started a position in AFSI as of this writing.”

The Bull Trader reader, Michael B., wrote in to give his thoughts on TBSI, TBS International Limited stock.

“I am writing to you about TBSI (Nasdaq).

A little more about TBSI: TBS International Limited, an ocean transportation services company, offers shipping solutions through liner, parcel, bulk, and vessel chartering services. Its liner, parcel, and bulk services primarily carry steel products, salt, sugar, grain, fertilizers, chemicals, metal concentrates, aggregates, and general cargo. The company also provides short and long-term time charters that offer its customer an alternative means to contract for ocean transportation of cargoes and make the carrying capacity of entire vessels available to its customers. In addition, it provides frequent regularly scheduled voyages in its network, as well as cargo scheduling, loading, and discharge for its customers. Further, TBS International’s parcel service originates in Peru, Ecuador, or Chile; and carries metal concentrates, beet pulp pellets, and fertilizers to East Asia.

The chart on TBSI is extremely bullish: The Point & Figure chart gives it an overall $52.50 target.

The short-term stock chart is also very bullish:

There is no insider selling, they have an extremely low P/E and their comments on the CC call were very positive (Rates to stay strong thru the rest of the year, the value of the fleet is worth at least 25% more than what is on the books. They continue to see a strong market).

What is helping TBSI is also the fact that it’s in a very hot sector. Jefferies (which has been the only analyst) has been raising the target on the stock during the last few weeks:

April 30, 2007 TBSI dry bulk charter rates should stay strong through 2008-Buy@JEFF - Jefferies believes dry bulk shipping fundamentals should stay strong through 2008 and raised TBSI shares to $18 from $14

May 16, 2007 TBS International-TBSI still attractive despite appreciation-Buy@JEFF - Despite the move higher, Jefferies believes TBSI shares are attractively valued given the strengthening dry bulk supply/demand fundamentals and the company’s strong balance sheet. Target raised to $25 from $18.

Although I hate listening to analysts, I do think that TBSI has a good shot of reaching the $24-$26 level sometime in the near-term. Looks to me like a lot of money is coming into this stock/sector, and they are definitely not disappointing with their earnings.

I have initiated a position in TBSI and suggest that you do your own due diligence before buying it or any other stock that I talk about.”

Reader Michael B. wrote in to contribute his analysis on TWIN, Twin Disc Incorporated.

“TWIN has superb potential to be a big mover for months to come. The main reason is that TWIN is in a very hot sector right now. They make power transmission products installed in the drivelines and power-trains of farm tractors, road pavers, cranes, mining trucks, oil rigs, fire trucks etc. They manage and control the horsepower generated by internal combustion engines and electric motors. They are seeing strong demand across all of its end markets, especially from its oil and military customers. On the military side, the co supplies transmissions for the Army’s M88A2 Hercules combat recovery vehicle, a full tracked armored vehicle used to perform rescue and recovery of heavy tanks. As you can imagine, demand for replacement transmissions is large given the required power of these machines in the scalding heat in Iraq. Take a look at charts of SPAR and FRPT to see how these “military” plays have been taken up recently. And as we all know, the oil sector has been performing quite well lately also.

TWIN reported fantastic earnings on April 24. EPS was $1.27 vs. $0.64 a year earlier. Revenue rose 35% yr/yr to $86.4 million. Co said “With our six-month backlog at a record $118.4 mln, the preliminary outlook for FY08 is encouraging….The industrial cycle that began in earnest in 2004 remains strong. We continue to see positive trends.” In my opinion, TWIN is trading at only 17x LTM EPS of $3.91 which is still too cheap for a company which is growing earnings 100%. The company has said that Q4 will be better than Q3 and that next FY will be even better than this fiscal year. How can anyone argue that this company is overvalued?

Since those earnings were released, TWIN has gone up from $47 to as high as $69.60 (closing at $64.61 on Thursday). One might get scared that they have “missed” the run-up, but this company is still quite undervalued at this price and a target of $85-$90 is not out of the question sometime in not-too-distant future. The company also pays a quarterly dividend. Last time TWIN was trading in the $60’s, the company announced a 2-1 stock split (Jan 24, 2006). So in 16 months, the stock has more than doubled.

The float on TWIN is only 4.6 million shares:

Institutions are holding about 2.5 million shares

The stock market chart on TWIN

Looks like very good support in the $58-$60 area.

I initiate my position at earlier today, but wish again to remind you to do a full due diligence on your own before buying this security or any other that I have discussed.”

Mike B., the same author who wrote in about Synalloy Corp [SYNL], Imergent [IIG], and Rochester Medical [ROCM], wrote in today to talk about NVTL, Novatel Wireless.

“Novatel Wireless has a huge short position – about 23% of the float (almost 6 million shares of the 27 million float):

The chart is almost picture-perfect:

The stock was trading between 19.30 – 20.30 in after hours, which puts it above the 19 resistance that it had. The MACD is crossing over into positive territory, and NVTL is above the 10,20,30 & 50-day moving averages.

I strongly feel that NVTL has almost no resistance now until about $22.50, but $24-$25 would not be out of the question based on so many shorts that refuse to cover and many of the analysts who have $15-$21 targets on the stock (pre-earnings), and will have to raise those.

Also, here is what Briefing.com had to say about NVTL.

Novatel Wireless beats by $0.05, guides above consensus (18.71 +0.52) : Reports Q1 (Mar) earnings of $0.40 per share, excluding non-recurring items, $0.05 better than the Reuters Estimates consensus of $0.35; revenues rose 173.4% year/year and 43% sequentially to $109.8 mln vs the $101.9 mln consensus. Co issues upside guidance for Q2 (Jun), sees EPS of $0.20-0.22 vs. $0.16 consensus; sees Q2 revs of $90.0 mln vs. $83.2 mln consensus. Co issues upside guidance for FY07, sees EPS of $1.00-1.05 vs. $0.89 consensus; sees FY07 revs of $380-390 mln vs. $369.2 mln consensus.

Please do your own research, but I purchased some shares today and I expect the above targets to be hit within a week or two.”

Interactive Brokers is going to IPO soon under the symbol IBKR. I just read a very nice IPO analysis at Technicator.NET.

According to my valuation, I think the company is conservatively worth $27-30/sh if they accelerate their earnings due to the IPO fundraising. Their current growth and correlation of earnings, expenses, and revenues are very consistent and predictable. Due to this predictability, it is easy to gauge where their stock price should be. Before the IPO, they grew earnings at a 14% pace. After the IPO, I expect them to grow at least 19%. This would value the stock at $27-29. IBKR has a profit margin of 56% compared to E-trade and Charles Schwab’s 35-40%.

Read the rest of Frank’s IBKR IPO Analysis.

DNDN stock (DENDREON CORPORATION), has been posting a record rally for the last few days. Fueled by an FDA vote for its cancer drug, the stock has been skyrocketing.

I’ve been doing some research on this stock, and I found a very valuable analysis of DNDN at Technicator.NET. Here is a snippet of the analysis.

They expect up to $500 million in sales per year if this is successful (expected date of approval is some time in 2010). This means that 0.3 * $500MM = $150MM in expected cashflow was anticipated by the drug Provenge. Now, it is about 0.6 * 500MM = $300 million. In the very short term, the stock price should be adjusted to about 100% then the average in the recent months. That puts it to 2 * 4.59 = $9.18.

Technicator valuates DNDN stock at

$11.80 (conservative valuation) to $23.87 (aggressive valuation)

Go read the rest of Technicator’s Dendreon valuation. It’s a realy great writeup, and Frank really hit a home run with this stock pick.

Cal @ ChartSetups also has a valuation on DNDN if Provenge is approved.

Reader Michael B. wrote in to talk about SPAR, Spartan Motors.

“Anyhow, today I am letting you know about SPAR (Spartan Motors). It looks like the stock is breaking out on large volume. See the wonderful �W� pattern and how today it may close at above the previous resistance of the $24.30 level?

Keep your eyes on this one, as a lot of shorts have bet the �wrong way� on this stock, and I think that it could as high as $28 in the near term.

The stock is currently ranked #34 on the Investors Business Daily Top #100 stocks list but it has a chance to move up to around #15 or so. Also, Vector Vest has a �fair value� target of $34 on SPAR.

Float is 19.3 million with about 6% of it short:

I entered a long position earlier today and as always advise to do your own research before buying or selling any stock. Also, the �new� short numbers are coming out within a few days, and I am sure that there are a lot more shorts than the current 6% and they are getting squeezed.

My call on SPAR is purely technical as I it going higher on very good volume today, and even when the market was selling off earlier today, the stock held strong. This tells me that there are more buyers here than sellers.”

A reader wrote in with this analysis on ROCM, Rochester Medical Corp.

1) “ROCM has a float of only 7.6 million shares. Volume has been increasing to the upside during the last few days.

2) 1) It is the highest (#1) rated Medical stock by Investor�s Business Daily. It is also currently ranked #19 on IBD�s Top 100 list.

2) It has a �fair value� of $32 given to it by Vector Vest and is rated in the top five overall �under $20� stocks by Vector Vest.
3) The stock charts on ROCM are �extremely bullish�. The MACD and Stochastics are positive, RSI is not overbought and the stock is above the 10,20,30,50 moving avgs.

4) Institutions now own around 17% of the outstanding float, and have been increasing their positions every quarter:
You should definitely do some of your own additional due diligence, but I think that if ROCM can get over $19.50, the next near-term target should be around $22. I have started to initiate my position in ROCM over the last few days.”

A reader wrote in to me to alert me about a short squeeze on IIG, IMERGENT INC.

“If you ever wanted to see what a major �short squeeze� looks like, you may have your chance with IIG (Amex). The company has a float of 10.2 million shares, out of which 5.5 million have been sold short.� That means that 55% (!!!) of the trading float has been sold short. Here is the link to Bloomberg to verify this information:

Today, IIG made a new 52-week closing (and intraday) high on above average volume:

If you look at the above chart, you can see the RSI, MACD and Stochastics are now all positive. The stock is not overbought and is above 10/20/30/50 day moving averages.��� Check out some other charts for IIG:

The company has started to buy back their own stock:
�

One of the top �LBO� firms (Steven G. Mihaylo of Vector Capital Group) has recently started a position in IIG, meaning that they may want to offer a �buy-out�:

This is a list of the top institutional and fund holders of IIG:
While it is very hard to make predictions of how high IIG will go, it is very obvious that sooner or later the shorts will have to cover.�� Now, you may think that the rise of the stock from about $12 in August 2006 to now $24+ has caused shorts to capitulater, you are wrong.� Take a look at the monthly short interest on IIG:
And here is the last interesting statistic.�� IIG has been on the �naked short� list for over 50+ days now.� Look at #30:
�

While it is hard to predict how high will go, there is no doubt that the potential is here that IIG could easily see mid $30�s very soon.��� And for those who may think that maybe IIG is �overvalued�, its current P/E is 2.7 and going forward P/E is 18.� Most others companies in the same sector are trading around 30-35 P/E.”

Please as always, do your own due diligence.

Daniel Jacome of Catablast submitted to us a copy of a fundamental analysis stock report on COSTCO (COST).

Here is a snippet of the report.

Investment Recommendation:
We encourage investors to HOLD Costco and weather any temporary blips in share prices. COST’s fortune rests on consumer spending patterns, fuel prices, and its ability to compete with Wal-Mart/Sam’s Club cost advantage and mass retailers like Target, which does not charge membership fees. Nevertheless, continued success in the grocer category - as well as addition of more private label goods to the inventory mix - should lead to slight margin expansion and ultimately, a higher valuation in the marketplace. Should Costco hit another stride, we believe the firm will continue to leverage its cash-flush balance sheet by aggressively repurchasing its stock and paring down debt/equity by as much as 200 bps. A possible Fed funds rate cut in Q107 could create further upside for COST shares — with shares floating near our fair price level, we encourage investors to buy judiciously on pullbacks.

Customer Loyalty Remains Robust:
Costco has found its profit pool in the fees it charges members to join, which creates a high switching cost once customers have paid in. Membership renewal rate of 86% is sustainable, in our opinion. Recent penetration of the grocer category as been an overwhelming success for Costco (fresh food sales in Q4 surpassed every other merchandise category), which could help narrow the gap between Costco and behemoths like Kroger and Wal-Mart, which lead overall US grocery sales. We estimate that Costco’s membership fee, which accounts for 72.5% of EBIT and generates recurring revenue streams, will grow at a 5% CAGR over the next 3 years.

View the full fundamental analysis of COSTCO (COST). Thank you Daniel for sharing your analysis!

KLA-Tencor Corporation (KLAC) was founded in 1975 in San Jose - California, United States.

KLAC operates for the design, manufacture and marketing of process control and yield management systems for the semiconductor and other related microelectronics industry, areas in which it is the world leader.

KLA-Tencor offers a range of products and services that are used by every wafer, integrated circuit manufacturers and photomask manufacturers from all over the world; the company provides inline wafer defect monitoring; critical dimension metrology; reticle and photomask defect inspection; wafer overlay; film and surface measurement, and overall yield and fab-wide data analysis.

KLAC�s current products portfolio can be divided in 4 different groups, those being; Metrology, Defect Inspection, Data Storage and Customer Service and Support, Yield Management Software Solutions; the company also provides refurbished (cleaned and repaired) KLA-Tencor certified tools, along with warranty and support.

The semiconductor industry grew almost 25% in 2005, while the semiconductor equipment industry grew over 60% last year. Analysts are forecasting that the semiconductor revenue growth will slow to approximately 10% and semiconductor equipment revenues to decline by approximately 7% over the current year.

Over the longer term, KLAC expects the process control to continue to represent a high percentage of their customers’ capital spending.

KLA Tencor employees are now over 5,500 and its full market capitalization is over 9 Billion Dollars.

On the fiscal year ended last June 30, KLAC achieved a profit margin of near 18% and an Operating Margin near the 18.15% area.

With total revenue of around $2 Billion, the company�s revenue per share was over $10 in 2005.

Akamai Technologies, Inc. (AKAM) is a Cambridge � Massachusetts, United States Company, incorporated in 1998. I pointed out the AKAM stock chart technicals a few weeks ago.

This company is doing business around the Internet area, by providing services for improving and accelerating the delivery of content and applications over the World Wide Web. The company’s solutions portfolio is designed to aid governmental agencies, businesses, and other enterprises; their tools help improve the revenues and reduce the costs by maximizing the performance of the online businesses.

The Company’s worldwide distributed platform (already in 69 countries) includes more than 18,000 servers in more than 950 different networks.

Last year Akamai Technologies began commercial efforts for selling its Web Application Accelerator service, a solution designed to improve the overall performance of Web and Internet protocol based applications. At the same time the Company also made public 2 free information tools: the �Net Usage Index for Retail�, that measures Internet traffic, and the �Net Usage Index for News�, which covers and tracks online consumption of news at selected sites and portals.

On the fiscal year that ended on last 31st December, the company achieved a Profit Margin of 91.69%, along with an Operating Margin of 21.39%, while its total revenue was $349.84 Million, which means something around $2.35 per share.

Their improved financial results in 2005, when compared to previous years, reflect the company efforts to increase their monthly recurring revenues and at the same time to reduce the expenses needed to support such growth.

Shares at Nasdaq ( NasdaqGS:AKAM ) ended the trading day at $39.98, winning 1.14%, even though still a bit lower than the 52 week high at $42.

PW Eagle, Inc. (PWEI) is a US company which headquarter is located in Eugene - Oregon. The company was founded in 1984 and it was formerly known as Eagle Plastics, Inc.; its name changed to Eagle Pacific Industries, Inc. in 1995.

PWEI manufactures and distributes polyvinyl chloride (PVC) pipe and fittings that are used for potable water and sewage transmission, for turf and agricultural irrigation, for water wells, fibber optic lines, electronic and telephone lines and for commercial and industrial plumbing. The Company distributes its products all over the United States, and provides also a minimal amount of shipments to a couple of selected foreign countries.

PWEI owned subsidiary, USPoly Company LLC (USPOLY), manufactures and distributes polyethylene (PE) pipe products and other accessories.

PWEI had a very successful 2005 on various fronts. Throughout 2005 and 2004, their operating performance has continued to improve; both volumes and margins increased in 2004 and 2005 compared to 2003, and their resulting cash flow from operations in 2005 was much higher than the year before.

The company�s net sales increased by $219 million last year, compared to 2004. Of this increase, over $166 million was due to higher volume and pricing in PVC products, and rounded $47 million was due to the UAC acquisition late in 2004.

PWEI, a company with over 1000 employees, generated a profit margin of 10.25% last year, while its Operating Margin achieved almost 17.49%.

Shares were trading at the Nasdaq (NasdaqGM:PWEI) at $33.85, near its 52 week high a bit over the $35 level.