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Breakout Getting Extended Beyond Max Buy Price Now - Tuesday, September 11, 2007
A classic example of the success enjoyed by many CANSLIM.net readers usually starts when an investor reads a CANSLIM.net report and buys a featured stock before it has risen above the pivot point by greater than 5%. After a stock breaks out above its pivot point, there is only a +5% window that investors have to purchase the stock under the proper guidelines. Once a stock rises above the "maximum buy price" the risk of a shake out balloons, meaning that even a normal retracement in the stock might force you to employ the 7-8% loss cutting rule. Much can be told by the stock's daily action in the weeks and months that follow a breakout. Typically, a light volume and orderly pullback suggests that the bulls remain in control. However, high volume pullbacks that violate support paint a totally different picture.
Measurement Specialties Inc. (MEAS +$0.90 or +3.20% to $27.20) charged further into new high territory with gains on above average volume, continuing its advance after confirming a technical buy signal on September 5, 2007. That day's After Market Report (read here) included the following note: "Y - Confirming gains today on +55% above average volume. Technically triggered a buy signal as it posted a gain on Tuesday with more than twice its average volume for a close above the pivot point. Today's strong close is a reassuring sign it may have what it takes to make a meaningful advance. Featured recently in the 8/26/07 Special Report titled ''7 Stocks That Should Now Be On Your Watch List'' with a graph annotated by the CANSLIM.net expert staff (click here to read)." Since then, this high ranked stock rallied above its $25.69 maximum buy price. Disciplined investors do not buy stocks above the pivot point by more than +5%, as that is an important threshold, and doing so is considered "chasing" a stock - which can lead to inferior results! The stock is currently up +11.15% from its pivot point. This is one of the latest good examples of how CANSLIM.net members are privy to information on timely buy candidates!
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MEAS - 7 Stocks That Should Now Be On Your Watch List - Sunday, August 26, 2007
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Measurement Specialties |
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Ticker Symbol: MEAS (NASDAQ) |
Industry Group: Elec- Scientific/msrng |
Shares Outstanding: 14,300,000 |
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Price: $24.50 4:00 PM ET 8/24//2007 |
Day's Volume: 114,200 8/24/2007 4:00PM ET |
Shares in Float: 13,000,000 |
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52 Week High: $25.00 8/17/2007 |
50-Day Average Volume: 104,600 |
Up/Down Volume Ratio: 1.7 |
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Pivot Point: $24.47 7/2/07 high plus .10 |
Pivot Point +5% = Max Buy Price: $25.69 |
Web Address: http://www.meas-spec.com |
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CANSLIM.net Company Profile: Measurement Specialties, Inc. engages in the design, manufacture, and marketing of sensors to original equipment manufacturers and end users. It produces and markets various sensors to measure precise ranges of physical characteristics, including pressure, position, force, vibration, humidity, photo-optics, and temperature. It sells its sensor products through regional sales managers, distributors, and sales relationships with outside sales representatives primarily in North America and western Europe. The company was founded in 1981 and is headquartered in Hampton, Virginia. The company sports a very healthy Earnings Per Share (EPS) rating of 91 and a strong Relative Strength (RS) rating of 84. It hasn't got a particularly impressive annual earnings growth history, or "A" criteria. MEAS resides in the Elec - Scientific/Msrng group which is currently ranked 59th of out the 197 Industry Groups covered in the paper, placing it just a bit outside of the much preferred top quartile. However, strong leadership in the group also includes several high-ranked stocks trading in close range of their 52-week highs right now including - FARO Technologies Inc. (FARO), Itron Inc (ITRI), Waters Corp (WAT), and Varian Inc (VARI) which helps satisfy the "L" criteria. Insiders own about 9% of its shares, which provides some motivation to protect and build shareholder value. Its small supply of outstanding shares could lead to dramatic price volatility, especially if the institutional crowd rushes in or out. From Sept '06 to Jun '07 the numer of top rated funds rose from 31 to 36, helping satisfy the "I" criteria.
Technical Analysis: The stock triggered a technical buy signal on Friday August 17, 2007 when it jumped above its pivot point on nearly two times average volume. It has not followed through with confirming gains since then, however the stock has held its ground. Its weekly chart features several up weeks on heavier than average volume versus only one down week on heavy volume, which is a bullish sign. MEAS may also face some resistance due to overhead supply from earlier highs near $30 in May of 2006.