Browsing Category: "stock"
1. Nvidia: We’ve written a lot about the strength of Nvidia in the Tech sector and the incredible upward potential of the stock. Not to push the meme, but its clear to us, at Fiscal Frenzy, that the strength of the stock is made most evident during bullish market cycles. As we’ve said, we strongly believe that 2010 will be one of the strongest years of economic recovery for the United States. Therefore, Nvidia will outperform the markets and see a strong recovery. As a manufacturer of graphics cards (generally considered luxury items), consumers will be much more prone to buy such products. Therefore, the technical and other strengths of Nvidia make it our number one recommendation for 2010. 2010 year end Price Target: 29
2. Research in Motion: Another tech stock that we love is RIMM, a company that we believe to have incredible upward potential. Just looking from the year 2006 to 2007, the stock gained over 400 percent. Its clear that like Nvidia, RIMM benefits significantly from bullish market cycles. Thus, with the Dow expected to have another year with gains as large as early 2007, we expect a double in RIMM’s stock bringing our Price Target to 130.
This week we are picking Research in Motion (RIMM) as a stock pick we believe is bound to do well in the bullish economic period we expect ahead of us. The famous BlackBerry maker has been held down near it’s lowest level since early April of this year. From April 6th to November 20th of this year RIMM shares have put up a mediocre .73% gain. Over this same period the Nasdaq has posted a 32% gain. The biggest reason for this extreme underperformance in RIMM shares was a bad earnings report that took $15 or 18% of the stock in one day. From this report several downgrades have flowed out of major analyst companies suppressing the companies stock price even further. Despite the negativity of many analysts, we believe RIMM shares are extremely undervalued and are poised for a run up to at least $70 by the end of this year. Shares of the company closed Friday’s trading session at $59.72. The recent recovery led to overly high expectations for its earnings report, but we believe that now that expectations are reasonable again, the stock will over perform. The smart phone market in which RIMM is a major player, is one market that has continued to grow despite the recession. This should be reflected in the company’s next earnings report which should help the company shares rebound. The stock has great fundamentals and is extremely undervalued due to a slew of unnecessary and unreasonable downgrades; thus, Fiscal Frenzy expects Research in Motion shares to rise sharply and strongly recommends it.
Following up on yesterday’s risky recommendation for Universal Insurance Holdings, we are moving on with a technical analysis of a slightly safer stock, Nvidia. While the conceptual aspects of the company are excellent (it essentially has a monopoly over the graphics card industry) we are purely focusing on the technical elements.
1) RSI: While most other companies have very cyclical movement that tends to always include bullish movement when the RSI hits 30, and bearish when the RSI hits 70, the RSI pattern for Nvidia is much more complex. As you can see, the last major increase the stock saw began back in July, after it had stalled over the month of June. As you can see, even though the RSI hit 70, the stock continued to increase and the RSI remained around or even above 70 for 2 and a half months. The pattern is something we could expect to see now, if we believe that the markets will have enough momentum to carry stocks with them in this most recent rally. Therefore, while the RSI of 50 may seem a detriment from buying the stock, it actually poses a scenario in which one could expect several months of uninterrupted, robust growth.
We continue our technical analyses and stock recommendations with a Chinese stock, Universal Insurance Holdings. Once again, we will not focus on the viability of the sector, since we’ve covered that in other articles. In lieu of that, we look purely to technical analyses of the stock as we did with Citigroup for our newsletter. We will primarily be looking at the stock’s RSI, Stock Price, and dividend.
1) RSI: As we explained in our most recent stock recommendation, the RSI is an excellent indicator of a stock’s momentum because it represents whether a stock is overbought or oversold. The indicator has just ticked below 70 and is making its way down to 50. While most companies are considered oversold when their RSIs hit 30, this company has major rebounds every time the RSI reaches 50 due to the bullish environment surrounding its rally. Therefore, look to jump on board within a week just as the RSI dips below 50, as it has so many times before just before rebounding.
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