Home Run Investor Intraday Alert - 08/11/2022

[Zacks Home Run Investor]

Home Run Investors, I was able to do a little shopping last night so I found a good name that has a lot of what we like to see.  The compa

Intraday Alert for Aug 11, 2022     Overview My Alerts Performance Commentary Guide FAQ/Support   Portfolio Additions Company Sym $MCap +Date $Add $Last %Chg ● Mercer Inter MERC 1.1 B 8/11/22 15.96   Portfolio Deletions Company Sym $MCap +Date $Add $Last %Chg ● Kronos World KRO 1.8 B 6/24/22 18.50 15.42 −16.6%   Open Portfolio   Company Sym $MCap +Date $Add $Last %Chg ● Piedmont Lit PLL 1.0 B 7/27/22 40.80 57.01 39.7% ● Quanex Build NX 832.6 M 4/20/22 21.40 24.94 16.5% ● Viper Energy VNOM 2.3 B 5/12/22 28.00 30.84 10.1% ● Vita Coco Co COCO 689.4 M 7/13/22 11.75 12.67 7.8% ● Afya Limited AFYA 560.0 M 8/3/22 11.45 12.15 6.1% ● Orion Engine OEC 1.0 B 7/21/22 16.45 16.75 1.8% ● DXP Enterpri DXPE 539.8 M 6/29/22 30.30 28.55 −5.8% ● American Van AVD 629.7 M 4/11/22 21.55 20.18 −6.4%

Home Run Commentary Adding MERC, Cutting KRO by Brian Bolan Posted on 08/11/22   Services Investor Services Investor Collection ETF Investor Home Run Investor Income Investor Stocks Under $10 Value Investor Zacks Top 10 Innovator Services Blockchain Commodity Healthcare Marijuana Technology Other Services Zacks Confidential Zacks Premium   Trading Services Zacks Ultimate Black Box Trader Counterstrike Headline Trader Insider Trader Large-Cap Trader Options Trader Short Sell List Surprise Trader TAZR     Home Run Investors, I was able to do a little shopping last night so I found a good name that has a lot of what we like to see.  The company is not recession proof, but somewhat close to that, has a good chart and strong scores. Before I get to that name, we have to do some housekeeping.  I am dropping our biggest loser in KRO.  The stock was a ZR4 (Sell) the other day but it bounced back up to a #3 today.  The simple fact is the stock is down more than what we can allow so I am cutting it here. Dropping KRO. New Addition Mercer International (MERC) is a Zacks Rank #1 (Strong Buy) that has A’s for value and for growth.  This is a paper producer that is based in Vancouver Canada but has plants in Germany.  This is the type of play that is somewhat recession proof and is showing decent growth as well. Earnings History I see a good earnings history with 4 beats in the last 4 quarters.  The company also posted a beat just a few weeks ago at the end of July.  The average positive earnings surprise over the last year works out to be 11%. Estimate Revisions So huge moves here in estimates, and if experience has taught me anything its that these are the type of revisions that can dramatically alter a stock price. This quarter has moved from 55 cents to $1.05. Next quarter moved from 34 cents to 60 cents. Full year 2022 has moved from $3.33 to $4.06. Next Year has increased to $1.88 to $3.48. Valuation I see an incredible valuation here.  A 4x forward earnings multiple with 43% topline growth posted in the most recent quarter.  The price to book is 1.4x which is super low.  The price to sales is 0.5x which isn’t something I like to see, but all the other metrics are just too good to pass up on. Margins have moved from 10.8% to 12.8% to 14.1% over the last three quarters.  As revenues grow and margins expand, EPS will continue to move higher.  EPS estimates are looking really good, so if there is another beat next quarter we should see this stock dramatically higher. See you soon, Brian More Commentary »

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