Updated: Jan 22
Hello fellow traders: subscribers and visitors! I know I owe my subscribers an analysis behind a few of my recent trades. The past couple of months hopefully everyone was busy making money. I had a few profitable trades now closed. So far, the year looks great. The average profit for my closed positions in 2020 is 69% with a couple of positions like JKS and SQ closed at over 200% profit.
The average unrealized gain for the open position currently stands at 12.7%. Most of the holdings in my portfolio are new as I closed many profitable positions, so the unrealized gain is still quite low. You can follow the list of closed positions and my portfolio here (you will be asked to subscribe to my website): https://www.wininstocks.com/watch-list-and-portfolio
Below is the list of stocks for long term holding that I am particularly bullish about as my target for those is at least double the current price:
My best stocks for long term holding:
Let's look closer into each of the above to see why I am bullish.
ENVA stock (Enova International Inc)
Price at the moment of this article: $20.92
Enova International, Inc., a technology and analytics company, provides online financial services. The company offers short-term consumer loans; line of credit accounts; installment loans; receivables purchase agreements; CSO programs, including credit-related services.
There are 5 analyst ratings with an average target price of $27.75 (33% upside).
The stock is quite underpriced at current price. The EPS for the past 4 quarters was $5.83 which gives us a P/E ratio for ENVA stock of just 3.59 compared to the US Consumer Finance industry average of 11.1x. The EPS for ENVA stock is expected to slow down a bit in 2021, but in 2022 it is expected to restore growth to achieve EPS of $6.34. At these EPS levels and current price of $20.92 this would provide a forward PE of 3.3.
Despite sales for ENVA have recently been declining, ENVA was able to increase and beat its EPS estimates: for Q3 the company delivered EPS of $3.09 vs. estimate of $0.80 which was due to a decrease in Operating Expenses. As sales for ENVA are expected to rebound in 2021 I think the company may maintain its new level of profit margin and will continue to beat estimates.
Even using the estimated EPS of $6.34 for 2020, and a fair category P/E of 11 the price for ENVA stock should be above $60.
BDSI stock (BioDelivery Sciences)
Price at the moment of this article: $3.99
BioDelivery Sciences International, Inc., a specialty pharmaceutical company, engages in the development and commercialization of pharmaceutical products in the United States and internationally. The company provides its products based on its patented BioErodible MucoAdhesive drug-delivery technology, a small erodible polymer film for application to the buccal mucosa, as well as other drug-delivery technologies.
There are 8 analyst ratings with an average target price of $8.00 (100% upside).
There is a good coverage from analysts with quite unanimous view of the future EPS growth (the dispersion of EPS predictions is quite low). The last year's EPS for BDSI stock is $0.15 giving it a P/E ratio of 26.6. However, EPS for BDSI stock is expected to grow to $0.72 by end of 2022. At this level of EPS and current price, BDSI forward P/E ratio would be 5.54. And the company may continue to grow its EPS after that, so a P/E ratio of 20 would be a fair valuation. Thus the stock price may go up to match P/E of 20-26 before the beginning of 2022. This would provide a price of over $14.40.
With the expected growth in EPS the stock has a PEG ratio (Price-to-Earnings-Growth) of just 0.6. Everything below 1 is considered to be a good score, meaning the stock price is underpriced.
BDSI stock beat estimates for its EPS for Q3 delivering $0.09 vs. $0.05 expectation. A word of caution for this stock is that its management is notorious about selling stock at times of new highs which already resulted in a stopped run couple months ago. On a positive side, BDSI announced stock repurchase when issuing Q3 2020 results.
ATRS stock (Antares Pharma Inc)
Price at the moment of this article: $2.88
Antares Pharma, Inc. focuses on developing and commercializing self-administered parenteral pharmaceutical products and technologies in the United States, Europe, and internationally.
There are 6 analyst ratings with an average target price of $6.25 (117% upside).
ATRS stock delivered EPS of $0.06 for the past year. This provides EPS of 48. However, its EPS is expected to grow to $0.43 by the end of 2023. At this EPS and current price the stock will have a forward P/E of 6.7 by end of 2023. Currently US Medical Equipment industry average stands at 48.6x, but we will use a more conservative PE of 20. This would mean the price for the stock should reach $8.6 by 2023.
VERU stock (Veru Inc.)
Price at the moment of this article: $3.04
Veru Inc., an oncology and urology biopharmaceutical company, engages in developing novel medicines for prostate cancer treatment and prostate cancer supportive care. The company’s oncology drug candidates include VERU-111, an oral alpha and beta tubulin inhibitor, which is in a development Phase 1b/2 for the treatment of metastatic castration resistant prostate cancer; Zuclomiphene citrate, which is in a Phase 2 clinical trial for the treatment of hot flashes in men undergoing androgen deprivation therapies; and VERU-100, a GnRH antagonist that is in planned Phase 2 clinical trial for the palliative treatment of advanced prostate cancer.
There are 4 analyst ratings with an average target price of $8.50 (180% upside).
The company is currently unprofitable, but analysts think VERU stock will reach EPS of $1.03 by mid 2024. This would mean the price can reach $20 by then.
VERU already has a couple of products in the market that grow sales, but it also has a few products in pipeline in different stages of development and approval. Addition of at least 1 or 2 of those products to VERU's portfolio will let the company easily reach or even surpase the estimated level of EPS.
EXEL stock (Exelon Corporation)
Price at the moment of this article: $18.91
Exelixis, Inc., an oncology-focused biotechnology company, focuses on the discovery, development, and commercialization of new medicines to treat cancers in the United States. The company’s products include CABOMETYX tablets for the treatment of patients with advanced renal cell carcinoma who received prior anti-angiogenic therapy; and COMETRIQ capsules for the treatment of patients with progressive and metastatic medullary thyroid cancer.
There are 14 analyst ratings with an average target price of $30.85 for EXEL stock (63% upside).
The company delivered $0.48 in EPS for the past 4 quarters. This gives us current P/E ratio of $39.4. The company is expected to rebound in terms of sales growth which will convert to a rebound in EPS (which have been declining over the past 2 years). EPS for the company is expected to reach $2.35 by the end of 2024. With this level of EPS and the current price the stock will have forward P/E ratio of 8. This means EXEL stock price may reach $48 by then.
ACLS stock (Axcelis Technologies Inc)
Price at the moment of this article: $26.40
Axcelis Technologies, Inc. designs, manufactures, and services ion implantation and other processing equipment used in the fabrication of semiconductor chips in the United States, Europe, and Asia. The company offers high energy, high current, and medium current implanters for various application requirements. In addition, the company offers aftermarket lifecycle products and services, including used tools, spare parts, equipment upgrades, maintenance services, and customer training. It sells its equipment and services to semiconductor chip manufacturers through its direct sales force.
There are 6 analyst ratings with an average target price of $33.67 for ACLS stock (28% upside).
ASLS delivered $1.33 in EPS for the past 4 quarters, providing for a PE of 20. However, EPS for ASLS is expected to reach $2.39 on growing sales. At that level of EPS and current price forward P/E would stand at 11. The US Semiconductor industry average currently stands at 36.1x. Even if we take a more concervative P/E of 20 the ASLS stock may reach price of $47.80.
ZYXI stock (Zynex)
Price at the moment of this article: $13.42
Zynex, Inc., through its subsidiaries, designs, manufactures, and markets medical devices to treat chronic and acute pain; and activate and exercise muscles for rehabilitative purposes with electrical stimulation.
There are 5 analyst ratings with an average target price of $25.75 for ZYXI stock (92% upside).
ZYXI delivered EPS of $0.31 for the past 4 quarters which puts ZYXI stock at P/E of 43. However, the EPS for the company is expected to grow to $0.773 by the end of 2022. At that moment P/E (using 2022 EPS and its current price) would stand at 17. Given current PE for ZYXI stock is 43 and this aligns to US Medical Equipment industry average (48.6x) we could say ZYXI stock price may reach 43 x $0.773 = $33. To put a bit more conservative approach I am holding a target of $25 for the stock.
APT stock (Alpha Pro Tech)
Price at the moment of this article: $12.66
Alpha Pro Tech, Ltd., together with its subsidiaries, engages in developing, manufacturing, and marketing a line of disposable protective apparel and infection control, and building supply products in the United States and internationally. The company operates through two segments, Building Supply and Disposable Protective Apparel.
There is one analyst rating with a target price of $24.50 for APT stock (94% upside).
APT stock is a "white crow" in my portfolio as it is currently counter-cyclical in terms of stock price reaction to COVID news. On optimistic days of good news this stock declines, on pessimistic days it goes up. The company revenues and profits were surging on sales of disposable protection masks: EPS for APT stock went up from $0.03 in Q3 2019 to $0.58 in Q3 2020. This amounts to EPS of $1.46 for the past 4 quarters which puts APT stock at a P/E ratio of 8.7. The problem with this company is that time is working against it. With the nearing launch of vaccines hopefully COVID will be less of a problem for 2021. With this, sales and profits for the company are likely going to decline. However, many analysts say masks are not going away in the near future. The EPS for the APT stock is expected to grow to $2.49 in 2021. Even if we use P/E ratio of 10, the stock price should stand at $24.9.
Also, APT likely going to maintain higher levels of sales/profit due to established business with hospitals and other institutions. What could give a real boost in stock price is if management announces diversification plans to use the cash that has been pouring into the company. Currently, the investors are likely unsure about the future ability of the company to maintain its current levels of sales and profits. This is likely the most risky investment in my portfolio. I would not suggest to keep it for too long on the portfolio and closely watch price action.
The below stocks in the list follow the same strategy of evaluation: looking for stocks that are likely to grow sales/EPS that would put their forward P/E to below 20 making them good ideas for stocks for long term holding:
The idea is to follow quarterly results for the above and below stocks to see how they progress towards expected EPS. If they continuously grow EPS to reach the estimates, their stock prices are likely to appreciate.
COLL stock (Collegium Pharmaceutical, Inc.)
Price at the moment of this article: $18.54
Collegium Pharmaceutical, Inc., a specialty pharmaceutical company, develops and commercializes various products for patients suffering from pain.
There are 10 analyst ratings with an average target price of $28.29 for COLL stock (53% upside).
COLL stock just recently achived profitability and delivered $3.03 in the past 4 quarters. This puts COLL stock at just 6.1 P/E ratio. EPS is expected to grow to $2.21 by end of 2023. At P/E of 20 this would give us a price of $44.
FRTA stock (Forterra, Inc.)
Price at the moment of this article: $16.94
Forterra, Inc. manufactures and sells pipe and precast products the United States, Canada, and Mexico. It operates through Drainage Pipe & Products; and Water Pipe & Products segments. The company offers concrete drainage pipes used for storm water applications, residential and non-residential site developments, sanitary sewers, low-pressure sewer force mains, tunneled systems, treatment plant piping, and utility tunnels.
There are 7 analyst ratings with an average target price of $19.43 for FRTA (15% upside).
FRTA stock delivered $0.93 in EPS which gives it a P/E ratio of 18. EPS for the company is expected to grow to $2.304 by end of 2022. At PE of 20 this means FRTA stock price could go up to $46.
EBIX stock (Ebix, Inc.)
Price at the moment of this article: $31.52
Ebix, Inc. provides on-demand software and e-commerce services and solutions to insurance, financial, healthcare, and e-learning industries in the United States and internationally. It develops and deploys insurance and reinsurance exchanges; provides Software-as-a-Service (SaaS) enterprise solutions in the area of customer relationship management, and front-end and back-end systems; and offers outsourced administrative and risk compliance solutions.
There are 3 analyst ratings with an average target price of $52.67 for EBIX stock (67% upside).
EBIX stock delivered $3.81 is EPS which gives P/E ratio of just 8.27. Moreover, EPS for EBIX stock is expected to grow to $6.14 by the end of 2022 which could result in stock price for EBIX going up to as high as $120. I would use a bit of conservative approach and set the target of $85 unless more analysts weight in and the company continuously performs according to expectations.
GOCO stock (GoHealth, Inc.)
Price at the moment of this article: $11.63
As a leading health insurance marketplace, GoHealth’s mission is to improve access to healthcare in America. Enrolling in a health insurance plan can be confusing for customers, and the seemingly small differences between plans can lead to significant out-of-pocket costs or lack of access to critical medicines and even providers.
There are 11 analyst ratings with an average target price of $20.10 for GOCO stock (73% upside).
Analysts predict GOCO stock EPS may go up to $1.5 at the end of 2023. At P/E of 20 this could mean the price could reach $30.
TRUL stock (Trulieve Cannabis)
Price at the moment of this article: $32.50
Trulieve Cannabis Corp., together with its subsidiaries, operates as a medical cannabis company. The company cultivates and produces products in-house and distributes its products to Trulieve branded stores (dispensaries) in Florida, California, Massachusetts, and Connecticut, as well as directly to patients through home delivery. It produces approximately 155 stock keeping units, including smokable flower, flower pods for vaporizing, concentrates, topicals, capsules, tinctures, and vape cartridges.
It seems there are no analyst ratings for price predictions for TRUL stock, but the analysits predict the revenue and profit for the company to increase in the next few years reaching $3.14 in EPS by end of 2023. At P/E of 20 this would give a price for TRUL stock of ~$66.
ICHR stock (Ichor Holdings, Ltd.)
Price at the moment of this article: $29.17
Ichor Holdings, Ltd. engages in the design, engineering, and manufacture of fluid delivery subsystems and components for semiconductor capital equipment. It primarily offers gas and chemical delivery subsystems that are used in the manufacturing of semiconductor devices.
There are 7 analyst ratings with an average target price of $38.00 for ICHR stock (30% upside).
ICHR stock delivered $2.16 in EPS for the past 4 quarters. This gives ICHR stock a P/E ratio or 13.5. Furthermore, EPS for ICHR stock is expecte to grow to $3.25 at the end of 2022. At P/E of 20 this could mean the stock price potentially going to $64.
FLGT stock (Fulgent Genetics Inc)
Price at the moment of this article: $43.00
Fulgent Genetics, Inc., together with its subsidiaries, provides genetic testing services to physicians with clinically actionable diagnostic information. Its technology platform integrates data comparison and suppression algorithms, adaptive learning software, and genetic diagnostics tools and integrated laboratory processes. The company primarily serves hospitals and medical institutions.
There are 4 analyst ratings with an average target price of $63.00 for FLGT stock (47% upside).
FLGT has been sharply gaining in sales/profits and delivered $2.25 in the most recent 2 quarters. $2.08 of that was delivered in the most recent quarter. If FLGT stock manages to continue to deliver this level of EPS this could result in annual EPS of $8.32 which would give a P/E of just 5.16.
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Disclamer: I own all of the above stocks. I do not suggest you should buy these stocks. As usually, please do your own due diligence before investing your own money in any of the above stocks. The above analysis is quite basic and just gives ideas for further research. A much deeper analysis is required for each stock, including the analysis of operations, debt, etc. I may sell any of the above stocks at any moment before it reaches the targets that I set or keep them for even when they reach the target.