AXXel Knutson Re-iterates "Strong Buy" on U. S and UK Markets
Rapid breaking of stock prices, massive volume to the downside, war, anthrax, terrorism, recession...what could be worse? Nothing! Of course the market is a buy. Here is AXXel's Updated Newsletter
(PRWEB) October 22, 2001
October 19, 2001
An Update of the 10.1.01 Newsletter
Using, AXXel KnutsonÂ’s
VTAR™
[“Volume Trade Analysis Research”™]
“Manage the risk…the profits will take care of themselves”
“In this business, being right is not as important as making money…consistently, and one of primary tenets of the quest is the avoidance of the ‘obvious risk’”
Securities offered through
First Allied Securities, Inc.
Member NASD & SIPC
197 Mountainview Road – Warren – NJ – 07059
Email: axxel@blast. net or tradingweapon@aol. com
Telephone: 908.647.5750 FAX: 708.585.6185
First Allied is registered in all states. Mr. Knutson is registered in all states + Puerto Rico and Washington, DC
TradingWeapon™ VTAR™ [Volume Trade Analysis Research™] TradingWeapon & TradingEngine is Trade and service marked by and owned by Axxel Knutson.
© 1999-2001 all rights reserved, AXXel Knutson
[“Tradingweapon. com” is the business name for AXXel Knutson, who is a Registered Principal of an independently owned office of Supervisory Jurisdiction [OSJ] with First Allied Securities, Inc. TradingWeapon. com offers all of its securities business through First Allied Securities, Inc., a member of the NASD/SIPC. Bear Stearns Securities Corp. is the clearing agent for First Allied. Securities. Inc.
The Most Important Buy Point Since August, 1981 [10.1.01 & 10.20.01 BBC “World Service”
Update: 10.19.01 No change.
“In August of 1981 with the Dow at 888 it was a market environment of doom and gloom.
Someone named Granville was predicting a Dow 375 and nowhere was anyone looking for an up moveÂ…well, almost no one. Now 2001: The Dow clunked 685 points on September 17 the first day of resumed trading, 17 more on 9/18 and 144 to the downside on 9/19. During this drop the Fed poured money into the system with $11.7 billion in loans to banks for the week ending 9/12 setting records for liquidity increases by the Fed. On the 14th the Fed stepped up to the plate and bought $80 billion in Treasuries and mortgage-backed securities and those of U. S. Agency. Add to this the Fed entered into a $50 billion arrangement with the European Central Bank. In effect the cost of overnight borrowing is down to almost nothingÂ…make that 1%! All of this is inflationary in the intermediate term as government spends money for defense [no bang for that buck vs. investment in private industry related to efficiency]. Rates on 10 Year bonds have already started a move up in anticipation of increasing long-term interest rates. But given the dramatic growth of the 90Â’s the economy can afford this shift as long as it does not become permanent.
A recession is commonly defined as two consecutive quarters of declining GDP and we are likely to see that take place in the second half of 2001 even though the revised GDP numbers for the April-June period were revised upward to a growth rate of 0.3% from the reported 0.2%, hardly a reason to jump for joy. Business investment off the cliff at an un-revised negative 14.6% rate on the heels of the negative 0.2% crunch of Q1 and that represented a decline of 1.99 percentage points in the overall GDP numbers. Inventories continued their shrinkage and posted the largest drop since 1983. Consumer spending rose at the un-revised 2.3% rate-that will most certainly tank in the second quarter and is in part, the reason for the decline in stock prices in the previous week. Imports to the USA dropped 8.4% and that is an upward revision from the previously reported 7.7%
The rate of inflation as measured by the price index for personal consumption rose at 1.3% a slight revision downward. The first quarter was + 3.2%. We have cut rates 8 times this year…look for number nine in October. So we have benign inflation, consumers resisting the need to use plastic and all manner of negative news, war, pestilence, a measurable drop in stock prices on high volume…and we have raised out market signal to “Strong Buy.” This is as important a buy point for U. S. and FTSE shares as we have seen since 1981. We were right then…I think we will be right again.
We can expect that Defense will gain about $70 billion over the most recent budget + $17 ½ billion for airlines and $20 billion for New York City. Nevertheless, in the short-term in a recession [let’s call it what it is] fiscal stimulus is just the ticket at the moment. And now, in 2001 with the Dow not only having seen Dow 3,000 but Dow 11,500+ we can now suggest our long-term objective of Dow 25,000 is still very much a target. On the BBC “World Service” upon which I regularly comment, I moved my market stance from “Accumulate” to “Strong Buy” a week ago Friday, September 21st at about 8300 for the Dow and 1480 on Nasdaq Comp and just under the important break point of 1000 for the S & P 500. With the exception of the Monday following that week, the market has held together and advanced. We think that will likely continue. Here is the 1981 AXXel forecast-See the button below:
Button produced by AXXel Knutson, CEO of The Capital Defense Group in 1981 with the Dow at 888
Not since the malaise of the late 70’s and early 80’s have I seen a buy signal this strong. We have everything in place for that signal…measurable disbelief in our economy’s ability to provide growth and jobs, the biggest weekly decline in the Dow since 1933 off 14.3% to 8,236, a recession in this the third quarter of about –0.5% and –0.7% for Q$-2001. Significant and sustained negative price movement in stocks and dramatic increase in volume-all to the downside, novice investors looking for shorts and puts-look at the VIK index-and horrible news both economic and otherwise. The only thing lacking for a better signal would be if my secretary, Bubbles LaRue quit because she couldn’t afford the repairs on her broken down Rolls [actually, Rolls never “break down.” There are TIMES when they “fail to proceed.”]. The Brits have the marketing down on the Rolls don’t they? Fail to proceed, indeed. This market “failed to proceed.”
We are now going to look at the groups, quickly.”
AEROSPACE AND DEFENSE
Lockheed Martin [LMT-43.30] Strong Buy. The recent $46 high looks easy. Is 60 easy? Probably. Update 10.19.01 $ 47.05 retraced to $45-no change.
General Dynamics [GD-87] and triple digits the target. Stronger than LMT. Update 10.19.01 $ 82.40 interesting break to the $79+ range. Strong Buy.
Northrop Grumman [NOC-100.45] the top choice in the group. Strong Buy. With the base at $80, it is unlikely to test that range. Large supplier of radars, and the U. S. Air Force’s new F-22 Raptor fighter, the unmanned Global Hawk and the new DD-21 destroyer for the Navy. Update 10.19.01 $ 104.80 – holding well and a buy point could be the break of $100 if it occurs.
Raytheon [RTN-33.95] the producer of Tomahawk cruise missiles and its radars cruise along with F-14, F-15, F/A-18Â’s and the B-2. Add also the F-117 stealth fighter and the U-2. Strong Buy. Update 10.19.01 $ 35.65 minor break as well and that appears over.
Alliant Techsystems [ATK-83.75] is the producer of size of solid=propellant rocket motors and bullets. Call these consumables. The base is $70. Strong buy right here. Update 10.19.01 $85.62 here the break took it to about $83. No change in opinion.
Drs Technologies [DRS-34.80] Here is the news PARSIPPANY, N. J. -(Dow Jones)- DRS Technologies Inc. (DRS) received a $3.8 million contract from the U. S. Army to provide infrared thermal imaging systems for Abrams M1A2 battle tanks. In a press release Wednesday, DRS said its Second Generation Forward Looking Infrared system will be part of the system enhancement software on the Abrams M1A2, the Army's fully digital ground combat vehicle. The defense technology company said the system provides day and night
Vision capabilities enhancing surveillance ranges, "increasing target acquisitions and significantly reducing fratricide." The base $20 then $25-28. The recent high about $40. The buy point here and on any break of $30. Update 10.19.01 $ 37.63 a strong break but that appears finished. There was no break of $30, but $32 is close enough. Strong Buy.
Here are the numbers:
QUARTERLY SUMMARY
HISTORICAL QUARTERLY RESULTS (Thousands of U. S. Dollars)
REVENUES 1999 2000 2001 2002
1st Qtr JUN 44,110 85,646 94,521 103,352
2nd Qtr SEP 44,128 88,253 107,227 0
3rd Qtr DEC 75,193 103,570 95,935 0
4th Qtr MAR 102,418 113,998 129,923 0
EPS (U. S. Dollars per share)
1st Qtr JUN 0.050 0.130 0.180 0.300
2nd Qtr SEP 0.010 0.130 0.200 0.000
3rd Qtr DEC 0.100 0.210 0.280 0.000
4th Qtr MAR 0.220 0.230 0.340 0.000
Engineered Support Systems [EASI-46.05] Engineered Support Systems, Inc. engineers and manufacturers a wide range of electronics and military support equipment for various branches of the U. S. military and commercial customers. The base is 35-40 and the lift off is impressive. One can trade it from here and accumulate size sub $40. This tells the story here: “ST. LOUIS, Sep 24, 2001 /PRNewswire via COMTEX/ -- Engineered Support Systems, Inc. (Nasdaq: EASI) has received an order totaling $5.8 million for production of its Chemical Biological Protected Shelter (CBPS) system under an existing contract with the U. S. Army. This order includes funding of certain engineering change proposals (ECPs) on the 113 units currently in production plus the exercise of an option for the production of an additional 10 CBPS units, according to Michael F. Shanahan, Sr., Chairman and CEO. Update 10.19.01 $ 46.25 no break of the forth number, but it now looks as if this is as good as we can do in terms of purchase…so purchase.
Hi-Shear Technology [HSR-2.30] on a watch list only. Here is why: from a recent news release: “Hi-Shear's electronic firing product revenues for the Patriot Advanced Capability (PAC-3) anti-missile program doubled during fiscal year 2001 reflecting the significant upgrades that the United States Army is making to its National Missile Defense program. The PAC-3 anti-missile is a surface to air missile, which offers increased range and accuracy as compared to current missile systems. This missile program is scheduled to expand rapidly from low rate production to full production over the next several years dependent on
Defense department appropriations. Hi-Shear's participation is the result of its ongoing investment to provide an array of the most advanced missile firing systems. Update 10.19.01 $ 3.70 more than a worthy trade. Accumulate sub $3.50. Doubtful to see a break of three.
Allied Research [ALR-15.60] and off the stable base at $9.00. the buy point is sub ten and useful for traders only until then. Here is why: “DJS Allied Research Gets $17 Million In Ammunition/Components Orders VIENNA, Va. -(Dow Jones)- Allied Research Corp.'s (ALR) defense unit, Mecar S. A., received $17 million in new orders from several unidentified customers for ammunition and components. In a press release Tuesday, the defense and commercial electronic security company said the orders call for various types of large caliber ammunition and components ranging from 105mm to 155mm systems.” [Source: Dow Jones]. Update 10.19.01 $13.90 we are not at a break of ten and it is unlikely to go there. But it can break from here and that IS the buy point.
Esco Technologies. Inc. New Comment [ESE-26.65] a terrific double bottom at the sub $23 level. Very nice track record and management positive statements about the quarter moved the stock from sub $23 to the current number. We would prefer to accumulate under $25. Here are the quarterly numbers. ESE is a supplier of engineered filtration products to the process, health care and transportation markets. For the 9 months ended 6/30/01, net sales rose 20% to $257.6M. Net income rose 4% to $12.8M. Revenues reflect growth in all three business segments and an acquisition. Higher income was partially offset
By higher SG&A expenses.
QUARTERLY SUMMARY
HISTORICAL QUARTERLY RESULTS (Thousands of U. S. Dollars)
REVENUES 1998 1999 2000 2001
1st Qtr DEC 78,077 88,193 65,865 82,871
2nd Qtr MAR 86,030 96,214 70,062 86,905
3rd Qtr JUN 98,236 113,978 79,235 87,862
4th Qtr SEP 102,740 117,717 84,995 0
EPS (U. S. Dollars per share)
1st Qtr DEC 0.210 0.120 0.400 0.310
2nd Qtr MAR 0.260 0.160 0.280 0.340
3rd Qtr JUN 0.310 0.320 0.290 0.350
4th Qtr SEP 0.120 3.360 0.360 0.000
Oshkosh Truck Corp. [OTRKB-33.75] we like this company without military trucks. But with it? A buy. OTRKB engineers, manufactures, and markets a broad range of fire & emergency apparatus and specialty commercial and military trucks under the OshKosh, Pierce, McNeilus and MTM trademarks. Strong Buy. Update 10.19.01 $39.15 no change and unlikely to test under $35.
Simula, Inc. [SMU-5.85] in process of blowing out through the room from the $2.00 base. We have no interest here preferring to see how high it goes before we see the likely crash pattern but we will likely buy that crash pattern and that is suspected to be about the sub $3.50 level. This PR release helped propel the stock-FYI:
Business Editors
PHOENIX--(BUSINESS WIRE)--Oct. 11, 2001--Simula,
Inc. (AMEX:SMU) said today that it has completed the implementation of seven successful corporate turnaround initiatives and at the same time it is experiencing an unprecedented level of business activity in its aerospace and defense segment.
The Company believes these factors account for recent activity in its stock and itÂ’s being a leading price percentage gainer on the American Stock Exchange three times in the last 30 trading days. On September 27, 2001 and October 9, 2001, Simula was the number one leading price percentage gainer on the AMEX; on October 10, 2001, the Company was
The number eleven leading price percentage gainer.
"The completion of the major initiatives of our corporate structuring, combined with
A high level of business activity, have stabilized our business and apparently allowed the market to start to recognize the value in our Company," said Simula President and CEO, Brad Forst. "We have just marked the one year anniversary of our management change and rebuilding plan. We are now positioned to take advantage of the future -- a future that looks promising."
On September 27, 2001, the Company said that due to recent events involving
Terrorist attacks on the U. S. and the anticipated military response, it
Was handling numerous customer inquiries from the Department of Defense
And branches of the military for products produced by its aerospace and
Defense segment.
"We have never entertained such a high dollar level of activity in making proposals to defense customers as in recent weeks," said Forst "We cannot quantify at this time what amount of our bid and proposals will mature into contracts. Clearly we will not win all the business on which we have proposed. However, the level of proposal activity in our
Defense segment is unprecedented and should translate into significant unexpected growth in this part of our business going forward. We expect to be able to discuss the level of contract awards within the next four to six weeks."
The Company's products in its aerospace and defense segment include crash-worthy seating systems for military helicopters, vehicle armor, body armor worn by military personnel, emergency bailout parachutes, flotation collars, and helicopter cockpit airbag systems, as well as other ancillary safety products used by military air crews and survivability products
Used to protect soldiers on the ground and in vehicles.
On September
26, 2001, the Company announced that it had completed a $25 million refinancing
As an important part of its balance sheet restructuring and a significant
Milestone in its rebuilding efforts that commenced with the change of management
In October 2000. Since October 2000, other turnaround initiatives of the
Company include the change of the CEO and all other executive management;
The sale of unprofitable businesses and narrowed focus to core safety technology businesses;
The adoption of a new business model emphasizing strategic alliances, licensing,
And monetizing technology; a material reduction in workforce and reduction
In operating costs; the rationalization of research and development investment
And priorities and reduction of expenditures; and balance sheet restructuring
And write-offs. The Company returned to profitability in Q1 and Q2 of 2001.
On September27, 2001, the Company said it expected to be profitable in
The third quarter ending September 30, 2001 before restructuring and refinancing charges
Associated with the recent refinancing.
Kreisler Manufacturing New Comment [KRSL-7.00] with a solid base at the $5.50 level, KRSL rocketed to the nearly ten number in late September. We have, of course, the retracement and it is here that we have a buy interest. KRSL fabricates precision metal components and assemblies for aircraft engines with both military and commercial applications. KRSL products include tube assemblies of multiple sizes & configuration, vane inserts, and blade locks. For the FY ended 6/30/01, net sales increased 30% to $18.7M. Net income totaled $2.3M, up from $305K. Revenues benefited from new customers. Net income also reflects decreased professional fees.
Kreisler Manufacturing Corporation New Comment (Nasdaq: KRSL) 10.1.01 announced fourth quarter diluted earnings of $.51 per share compared to $.07 per share for the fourth quarter in the prior year, a 725% increase. Diluted earnings for the year ended June 30, 2001 was $1.13 per share compared to $.15 per share for the prior year, an increase of 750%. The past year was a successful one for Kreisler Manufacturing Corporation. The company achieved record sales of $6,306,000 for the fourth quarter and $18,662,000 for the year ended June 30, 2001. Net income was $1,029,000 for the fourth quarter and $2,304,000 for the year ended June 30, 2001. In 2001 Kreisler diversified its marketing and sales efforts to expand its presence in the industrial gas turbine market. This market accounted for 52.9% of Kreisler's increase in sales for 2001.
ICTS International Nv New Comment [ICTS-6.92] - aviation security services. Large breakaway gap from the stable price base of sub $5.00 to nearly $13. Management is highly suspect but now we have the pullback and we are interested. Operates primarily in Europe & the U. S., providing passenger handling related services to major carriers. ICTS is also engaged in security consulting, training & auditing for airlines & airports. For the 6 months ended 6/01, revenues rose 29% to $90.8M. Net income totaled $32.7M, up from $5M. LetÂ’s put on the watch list.
Edo Corporation New Comment EDO-24.84] again we have a solid base and a leap off it post September 11th – in this case from $19 to over $30. We are consolidating that advance and our interest is peaked. This is close enough to accumulate and becomes a “strong buy” upon a break of $20. Here is a recent release of interest:
NEW YORK-- (BUSINESS WIRE)--Oct. 9, 2001—EDO Corporation (NYSE:EDO) announced today that it has acquired Dynamic Systems, Inc., a privately held company based in Alexandria, Virginia.
Dynamic Systems, which will become part of EDO's Systems and Analysis Group, provides
Professional and information technology services primarily to the Department of Defense and other government agencies. Terms of the acquisition were not disclosed.
EDO Corporation (www. EDOcorp. com) supplies highly engineered products for governments and industry worldwide, including advanced electronic, electro-mechanical and information systems and engineered materials critical to the mission success of its customers. The Company's Defense Segment provides integrated front-line war fighting systems, including radar countermeasure systems, aircraft weapons storage and release systems, airborne mine countermeasure systems, and integrated combat systems and sonar systems and professional, operational, technical and information technology services. EDO's Space and Communication Segment addresses the needs of the remote sensing, communication, navigation, and electronic warfare industries with ultra-miniature electronics and
A broad line of antennas. The Company's Engineered Materials Segment supplies
Piezoelectric and advanced composites for the communication, navigation,
Chemical, petro-chemical, paper and oil industries, for civilian infrastructure and
Military applications.
Taser International New Comment [TASR-10.69] the July/August base was $5-6 and the stock has exploded to the current high of 12.26. We have no interest here, but will watch. We have no interest North of ten.
Here is the obvious news:
DJS Taser/M26 Weapon -2: For Airline, Airport Personnel Use
SCOTTSDALE, Ariz. -(Dow Jones)- Taser International Inc. (TASR) said it
Will start training its pilots to carry the Advanced Taser M26 less-lethal
Weapon in light of the call for arming of pilots following the Sept. 11
Terrorist attacks.
In a press release, the maker of less-lethal weapons said it made a
Policy exception that would allow its law enforcement use only Advanced Taser
M26 and 21-foot range air cartridges for airline and airport personnel use.
COMPUTERS & COMPUTER PERIPHERALS
Paravant [PVAT-1.90] Not a major player but a unique one. Revenues, small, but there and earnings as well-but erratic. PVAT engages in the design, development, production & sales of computer and communication systems, specializing in rugged, hand-held and
Laptop computer products with primarily military applications. For the 9
Months ended 6/30/01, revenues rose 53% to $36.1M. Net income fell 96% to
$33K. Revenues reflect the inclusion of a significant contract. Net
Income reflects a decreased gross profit due to a change in product mix. Update 10.19.01 $ 2.61 we still like it and like it here and on any break of $2.00 which looks unlikely. Recent high? A little over three.
Visionics [VSNX-11.55] and way off the base at four bucks. We will put on the watch list. Here is why: Develops & deploys facial recognition technology and designs and manufactures fingerprint biometric identification systems. For the 9 months ended 6/30/01, revenues rose 30% to $22.3M. Net loss before acct. change rose from $612K to $3.8M. Revenues reflect higher FaceIt license and live scan maintenance revenues. Net loss reflects lower gross margins and higher sales, marketing and product development costs and $2.2M in merger related costs. Update 10.19.01 $ 12.72 looking for the break of ten. The high was $15+ for traders.
Roxio, Inc. [ROXI-14.10] the base is about here with a recent spike to $18. We like it here and on any bounce off $11. Buy. They are selling product. Digital content management software that enable individuals to personalize and store music, photos, video and data onto recordable compact discs, or CDs. For the 3 months ended 6/30/01, revenues rose 29% to $37M. Net income fell 2% to $2.4M. Revenues reflect increased sales of Easy CD Creator 5.0 to distributors. Net income was offset by higher payroll costs and increased stock-based
Compensation expenses. Update 10.19.01 $14.68 no bounce off $11 but $13 ½ is close enough. Move to “buy.”
SAP AG [SAP-25.60] a chance to buy this high-end supplier of enterprise software
For the 6 months ended 6/30/01, revenues rose 26% to EUR3.38B. Net income rose 88% to EUR323M. Revenues reflect higher software, maintenance and consulting revenues due to the addition of new customers. Earnings also reflect on-going cost control efforts. Update 10.19.01 $24.89 and it looks like a break of $20. Step aside.
Datakey [DKEY-3.07] on watch list because it is a provider of smart card-based information security and digital signature solutions. For the 6 months ended 6/30/01, revenues rose 68% to $2.4M. Net loss from continuing operations increased 38% to $1.9M. Revenues reflect increased acceptance of the Company's information security product offerings. Net loss reflects increased S/G/A expenses due to costs related to the opening and staffing of three additional sales offices. Update 10.19.01 $4.15 a nice move to $6+ but the real buy point is coming up and that is sub three. Continue to watch only.
Identix, Inc. [IDX-8.18] the move $3.00 to nearly $11.00 was interesting. We have this on our watch list for a break and possible buy sub $5.00. IDX develops, manufactures and markets products that identify individuals through their fingerprints, & products that capture forensic quality fingerprint images. For the FY ended 6/01, revenues rose 11% to $81.8M. Net loss before acct. change applic. to Comm. totaled $27.6M, up from $12.9M. Results reflect higher live - scan systems revenues, offset by $1.9M restructuring charge. No debt and NO EARNINGS. Update 10.19.01 $7.79 a move to $11 [almost] but the buy point is still lower-perhaps a break of $ 6.00. Watching only.
Efunds, Inc. [EFDS-15.55] reluctant mover to the downside. We can see why given the growth or earnings and revs in a crummy environment. Here are the quarterly numbers: Update 10.19.01 $ 17.18 we will disconnect from this stock. Appears just boring.
Intelli Check, Inc. [IDN-11.95] On watch list and no interest North of ten. IDN manufactures and markets an advanced document verification system to determine the customer's age and validity of the ID to detect and prevent the use of fraudulent identification. For the 6 months ended 6/30/01, revenues rose from $47K to $475K Revenues reflect the initial sales of ID-Check terminals and terminal accessories. Higher loss reflects higher personnel-related and advertising expenses. Update 10.19.01 $ 13.10 and we are not yet seriously interested unless we can see a break of ten. That does look likely.
Factual Data Corp [FDCC-10.15] Accumulate the eights and nines. We like the mortgage finance area. FDCC provides a broad range of information services including business-to-business services to the mortgage lending industry For the 6 months ended 6/01, revenues
Increased 63% to $25.8M. Net income totaled $2.1M, up from $199K. Update 10.19.01 $ 9.49 the eights and nines do look right. Move from “accumulate” to “buy.”
CONSUMER DURABLES
Helen of Troy [HELE-9.75]. Strong Buy sub ten. Helen of Troy Limited designs, develops and sells hair dryers, curling irons, hot air brushes, brush irons, lighted mirrors, hair setters,
Brushes, combs, hair accessories, women's shavers, footbaths, body massagers and hair clippers. For the 3 months ended 5/31/01, sales rose 20% to $91M. Net income rose 97% to $4.6M. Revenues reflect increased sales in the Tactica operating segment. Earnings also benefited improved margins. Update 10.19.01 $12.11 nice moveÂ…take the profit. Out-reported very nice earnings:
Quarterly Net Income Increases 95%
EL PASO, Texas, Oct. 8 /PRNewswire/ -- Helen of Troy Ltd. (Nasdaq: HELE), designer, developer and worldwide marketer of brand-name personal care products, today reported earnings and record sales for the second quarter and six months ended Aug. 31, 2001.
Second quarter sales increased 29 percent to a record $113,482,000 versus sales of $88,233,000 for the same period of the prior year. Second quarter net income increased 95 percent to $7,303,000 or 25 cents per diluted share, compared with $3,746,000, or 13 cents per diluted share for the same period year earlier.
First half sales climbed 25 percent to a record $205,557,000 from sales of$164,344,000 for last year's first half. Net income for the first half of this year was $11,894,000 or 41 cents per diluted share, versus $6,080,000, or 21 cents per diluted share.
CONSUMER NON-DURABLES
Sketchers [SKX-11.19] and warning and warning again the obvious. Now solidly in the base. Buy. Sketcher U. S.A., Inc. designs and markets branded contemporary casual, active, rugged and lifestyle footwear for men, women and children in over 100 countries. For the 6 months ended 6/30/01, net sales increased 54% to $458.4M. Net income rose 81% to $33.9M. Revenues reflect continued products demand and increased brand awareness and marketing efforts. Earnings also reflect increased gross margins due to reduced
Inbound ocean freight costs. But going forward, the word is moderation. Update 10.19.01 $12.08 no change.
Avon Products [AVP-45.85] a voice from the past. It appears that AVP has figured life out and that is showing up in good numbers in terms of both REVS and EPS. It is a global manufacturer and marketer of beauty and related products including cosmetics, fragrance and toiletries, gifts and decorative apparel, and fashion jewelry and accessories. For the 6 months ended 6/01, revenues rose 4% to $2.82B. Net income before acctg. change rose 12% to $219.7M. Revenues benefited from growth in worldwide beauty sales and increased representatives. Net income also reflects improved operating margins. Update 10.19.01 $ 46.49 no change.
CLEANING PRODUCTS
Church & Dwight [CHD-25.29] from this solid base, a buy. Manufactures and sells sodium bicarbonate-based products which the Company sells under the "ARM & HAMMER" trademark. For the 6 months ended 6/29/01, net sales rose 30% to $513.6M. Net income rose 6% to $25.6M. Revenues benefited from increased consumer product sales due to the addition of USAD acquired brands. Net income was partially offset by a lower margin sales mix and plant and warehouse shutdown expenses. Update 10.19.01 $ 24.96-accumulate.
DISCLAIMER
Investment decisions should not be based solely on our proprietary indicators, which are intended as an adjunct to your additional analysis. Please accept these comments as market commentary. We do not intend these comments to replace detailed fundamental analysis. We urge you to accomplish that additional research via your contacts on the Internet or through a trusted financial advisor. If you want additional information on any of the securities discussed within, we will give it upon your request.
This report has been prepared from original sources and company data we believe to be reliable, but we make no representation as to its accuracy or completeness. This report is published solely for information purposes. It is not to be construed either as an offer to buy or sell or the solicitation of an offer to buy or sell any security or the provision of or an offer to provide investment services in any state where such an offer, solicitation or provision would be illegal. Any opinions expressed herein are statements of our judgment on this date and are subject to change without notice and we likely not update that change to you. The opinions expressed are that of AXXel Knutson and are not necessarily representative of First Allied. First Allied Securities, Inc., its affiliates and subsidiaries and/or their officers and employees may from time to time acquire, hold, or sell a position in the securities mentioned herein.
The author of this report, Axxel Knutson, does not invest in any of the securities mentioned in this report nor does his immediate family unless such securities are management companies of mutual funds or indirectly if such equities are included in mutual funds or index options. Equity investment involves risk of capital loss. We recommend that your portfolio be diversified by company size, industry group, and geographic region and by currency.
It should not be assumed that future selections will be profitable or will equal the performance of past selections. Securities listed herein illustrate selections made using proprietary indicators known as VTAR™ [Volume Trade Analysis Research™]. These names, VTAR™, TradingWeapon, www. TradingWeapon. com Trading Engine™, www. tradingengine. com ™, Volume Trade Analysis Research™, are service marks/trademarks of AXXel Knutson.
All recommendations and commentary are directed toward sophisticated, aggressive traders who have significant experience trading in a volatile market and who possess the financial resources to risk a loss of some or all of their invested funds. Commissions and, if you use margin, interest charges will lessen any return on investment. VTAR [Volume Trade Analysis Research] centers around the proprietary analysis of trading volume, price, general fundamental analysis, beta concerns, group rotation and detailed analysis of risk as it relates to entry and exit points in reasonably liquid stocks.
Axxel Knutson, President
Axxel@blast. net
Www. TradingWeapon. com is a premium investor service -
VTAR [Volume Trade Analysis Research] ™
197 Mountainview Road, Warren, NJ 07059-8038
Telephone: 908-647-5750; FAX 708-585-6185.
AXXel Knutson is a registered Principal of and securities are offered through
First Allied Securities, Inc. Member
NASD/SIPC”
Axxel is guest co-host at JAGfn’s Internet television every four weeks or so-tune in at www. JAGfn. com. [currently re-organizing]. [He is a regular commentator for the BBC “World Service” and you may hear AXXel’s commentaries via short wave on the various BBC bands including the BBC “World Service” and BBC 5’s “Wake Up to Money.” He is guest commentator for Radio Scotland out of Glasgow. These reports may be available at www. multex. com and www. ibes. com.
AXXel was on AOLÂ’s MarkeTalk every day for two years on AOL. The program has shifted to www. sageonline. com and Axxel is on every Tuesday at noon. Transcripts are available via SageOnline. You can ask specific questions on line and AXXel will attempt an answer to your stock and investment questions
Bloomberg: Help, “Axxel” – then # 7, then # 2 for recommendations transmitted to Bloomberg. Not all recommendations are transmitted to Bloomberg. Market Commentaries on the BBC “World Service,” Radio Scotland, Bloomberg Radio and Television, www. multex. com, www. allstocks. com, www. afterhourtrades. com, www. marketdigestonline. com, www. ibchannel. com, www. vcall. com, ,www. tradingideas. com, www. pinkbulll. com, www. TradingWeapon. com, Additional message boards: www. siliconinvesor. com, [search “Axxel] search “Axxel, Tampa Bay Television, Channel 9, and others.
Email: axxel@blast. net or tradingweapon@aol. com
If you want me to handle your accountÂ
In response to inquiries relative to opening securities accounts handled directly by AXXel Knutson, here is the deal: Accounts are handled directly by Knutson [TradingWeapon. com is the business name for AXXel Knutson, who is a Registered Principal of an independently owned office of Supervisory Jurisdiction [OSJ] with First Allied Securities, Inc. TradingWeapon. com offers all of its securities business through First Allied Securities, Inc., a member of the NASD/SIPC. Bear Stearns Securities Corp. is the clearing agent for First Allied. There are no additional investment management fees and there is no sharing of profits or losses. Client-selected stocks may not enter the account unless approved by AXXel and this is not a likely occurrence. AXXel hates your stocks. The minimum account accepted is $100,000. Sob stories are listened to for amounts under $100k but rarely accepted unless AXXel is in the mood. These accounts tend to be trading accounts so donÂ’t even ask if you canÂ’t stand the activity and at times total inactivity and cash. AXXel very rarely trades in the same stocks as clients or those written about in his newsletters or spoken about in media appearances with the exception of stock index options and mutual fund management companies. AXXel will disclose positions personally held in any such stocks in newsletters when published. First Allied Securities, its brokers and its officers may take and have positions although they receive no advance notice of new recommendations or changes in opinion. The opinions expressed within are those of AXXel Knutson and may not be shared by First Allied Securities, Inc. its management or its brokers. Those interested in additional information on any stocks discussed within may call at 908-647-5750 or email AXXel at axxel@blast. net. We do not deal in BB stocks [with the exception of some ADRÂ’s]. Refreshing, isnÂ’t it?
AXXel Knutson’s VTAR™ Research at www. TradingWeapon. com. You may email AXXel at axxel@blast. net or you may not; it’s up to you after all.
Stock charts provided through the good offices of www. clearstation. com. Our research can also be found soon at WWW. Multex. com and on www. ibes. com on a pay-per-report basis.
