Alaska Communications Systems Group Inc (NASDAQ: ALSK) Q3 2011 Price Target

Recent price: 8.84$

P/E Ratio: -

3 Months Target Price: 29$

Company Description

According to Reuters, Alaska Communications Systems Group, Inc. (ACS) provides integrated communications services in Alaska. The Company’s wireline and wireless communications networks extend throughout Alaska and connect to the Lower 48 states via its two diverse undersea fiber optic cable systems. The Company operates through two business segments: Wireline and Wireless. The Wireline segment provides communications services, including voice, data, broadband, multi-protocol label switching (MPLS) services, network access, long-distance and other services to consumers, carriers, businesses and enterprises, and government customers throughout Alaska and to and from Alaska. The Wireless segment provides wireless voice and data service and products and other value-added services and equipment sales across Alaska.

Confidence Margins

Strong resistance $11.65 (+32%)

Light resistance $11.01 (+25%)

Light support $8.69 (-2%)

Strong support $8.42 (-5%)

Recommendation

this telecommunication company is highly undervalued by the market since providing guidance for it's revenues that was in line with what analysts were expecting. Current prices will provide a good return for investors willing to open a long position now.

Entry strategy

For the cautious investor:

Buy the stock for 9$ or less.

For the risk-taking trader:

The October 2011 10$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 30$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 11$, or keep it until 11.50$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 11$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Regis Corporation (NYSE: RGS) Q3 2011 Price Target

Recent price: 14.75$

P/E Ratio: 42.70

3 Months Target Price: 21$

Company Description

Data provided by Reuters tells us that Regis Corporation is engaged in owning, operating and franchising hair and retail product salons. In addition to the primary hair and retail product salons, the Company owns Hair Club for Men and Women, a provider of hair restoration services. As of June 30, 2010, the Company owned, franchised or held ownership interests in over 12,700 worldwide locations. The Company's locations consisted of 9,929 Company-owned and franchise salons, 95 hair restoration centers, and 2,704 locations, in which the Company maintains an ownership interest of less than 100%. The Company's hair restoration centers offer three hair restoration solutions: hair systems, hair transplants and hair therapy. The Company is organized in two lines of business: salons and hair restoration centers.

Confidence Margins

Strong resistance $21.69 (+47%)

Light resistance $19.20 (+30%)

Light support $12.84 (-13%)

Strong support $11.00 (-25%)

Recommendation

The stock price of Regis Corporation has been on a downtrend since the end of April 2011 when the company provided a revenue guidance that disappointed investors. The industry in which the company operates is not a very attractive one when compared to tech companies and investors have been giving away their shares. Current prices provide a good addition to a portfolio for the coming months.

Entry strategy

For the cautious investor:

Buy the stock for 15$ or less.

For the risk-taking trader:

The September 2011 17.50$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 40$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 21$, or keep it until 23.50$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 21$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

The Gap Inc (NYSE: GPS) Q3 2011 Price Target

Recent price: 19.28$

P/E Ratio: 10.50

3 Months Target Price: 23$

Company Description

According to Reuters, The Gap, Inc. is a global specialty retailer offering clothing, accessories, and personal care products for men, women, children, and babies under the Gap, Old Navy, Banana Republic, Piperlime, and Athleta brands. The Company operates stores in the United States, Canada, the United Kingdom, France, Ireland, and Japan. It also has franchise agreements with unaffiliated franchisees to operate Gap and Banana Republic stores in many other countries worldwide. Under these agreements, third parties operate or will operate stores that sell apparel, purchased from the Company, under its brand names. Its United States customers can shop online at gap.com, oldnavy.com, bananarepublic.com, piperlime.com, and athleta.com.

Confidence Margins

Strong resistance $23.73 (+23%)

Light resistance $19.82 (+3%)

Light support $17.69 (-8%)

Strong support $16.62 (-14%)

Recommendation

After reporting earnings for the first quarter 2011, shares of The Gap Inc have plummeted to reach levels that offer a very attractive valuation to the company. Investors getting in right now will experience satisfactory returns by September 2011.

Entry strategy

For the cautious investor:

Buy the stock for 19.50$ or less.

For the risk-taking trader:

The September 2011 20$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 97$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 23$, or keep it until 24$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 23$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

WESCO International Inc (NYSE: WCC) Q3 2011 Price Target

Recent price: 52.43$

P/E Ratio: 18.79

3 Months Target Price: 60$

Company Description

According to Reuters, WESCO International, Inc. is a North American distributor of products and provider of supply chain services used primarily in the industrial, construction, utility and commercial, institutional and government markets. It serves over 100,000 customers globally, through approximately 380 full service branches and seven distribution centers located primarily in the United States, Canada and Mexico, with additional locations in the United Kingdom, Singapore, China, Australia, Africa and the United Arab Emirates. WESCO sells electrical and industrial maintenance, repair and operating supplies (MRO), and electrical and non-electrical construction and original equipment manufacturer (OEM) products and services. Its primary product categories include general electrical and industrial supplies, wire, cable and conduit, data communications, control and automation and motors.

Confidence Margins

Strong resistance $64.90 (+24%)

Light resistance $59.08 (+13%)

Light support $46.93 (-10%)

Strong support $42.05 (-20%)

Recommendation

The recent earnings report seemed to disappoint investors even if profits for the previous quarter and revenue guidance for the rest of the year came in better than expected. At current prices, a long positions will yield good returns for investors.

Entry strategy

For the cautious investor:

Buy the stock for 53$ or less.

For the risk-taking trader:

The October 2011 55$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 360$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 60$, or keep it until 64$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 60$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

CarMax, Inc (NYSE: KMX) Q3 2011 Price Target

Recent price: 28.82$

P/E Ratio: 17.25

3 Months Target Price: 20$

Company Description

Data acquired from Reuters tells us that CarMax, Inc. is a holding company and its operations are conducted, through its subsidiaries. The Company is a retailer of used cars, which retailed 357,129 used vehicles, during the fiscal year ended February 28, 2010 (fiscal 2010). As of February 28, 2010, CarMax operated 100 used car superstores in 46 metropolitan markets. In addition, it sold 197,382 wholesale vehicles, during fiscal 2010, through on-site auctions. The Company purchases, reconditions and sells used vehicles. In fiscal 2010, approximately 90% of the used vehicles it retailed were 1 to 6 years old with fewer than 60,000 miles. It also offers a line of used vehicles at each superstore that are more than six years old or have more than 60,000 miles.

Confidence Margins

Strong resistance $37.82 (-28%)

Light resistance $35.00 (-21%)

Light support $26.81 (+7%)

Strong support $19,75 (+31%)

Recommendation

Shares of Carmax are very overvalued right now and they seem to be on track to continue in the coming months.

Entry strategy

For the cautious investor:

Sell short the the stock for 28$ or more.

For the risk-taking trader:

The October 2011 28$ out-of-the-money put option contract seems to be the right position to take, they can be acquired for about 230$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 20$.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 20$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Cytori Therapeutics Inc. (NASDAQ: CYTX) Q3 2011 Price Target

Recent price: 5.08$

P/E Ratio: -

3 Months Target Price: 7.50$

Company Description

According to Reuters, Cytori Therapeutics Inc. develops, manufactures, and sells medical products and devices to enable the practice of regenerative medicine. The Company’s technology is the Celuion family of products, which processes patients’ adipose-derived stem and regenerative cells (ADRCs) at the point of care. The Celution family of products consists of a central device, a related single-use consumable used for each patient procedure, enzymes, and related instrumentation. The Company also sells the StemSource family of products globally, including in the United States, for research as well as for the cryopreservation and storage of ADRCs. The other applications for the Celution System output, which are under development include, cardiovascular disease, wound healing, gastrointestinal disorders, stress urinary incontinence, liver and renal disease spinal disc degeneration and pelvic health conditions.

Confidence Margins

Strong resistance $8.44 (+66%)

Light resistance $7.72 (+52%)

Light support $5.04 (-1%)

Strong support $4.07 (-20%)

Recommendation

Current technical levels provide a great entry point for a position in Cytori Therapeutics for the coming quarter. As the long position in the favored action to take, this will yields great returns to investors.

Entry strategy

For the cautious investor:

Buy the stock for 5.50$ or less.

For the risk-taking trader:

The Semptember 2011 7.50$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 55$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 7.50$, or keep it until 8.25$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 7.50$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Stratasys Inc. (NASDAQ: SSYS) Q3 2011 Price Target

Recent price: 33.83$

P/E Ratio: 48.77

3 Months Target Price: 45$

Company Description

Stratasys, Inc. is a manufacturer of three-dimensional (3D) printers and rapid prototyping (RP) systems for the office-based RP and direct digital manufacturing (DDM) markets. The Company develops, manufactures and sells a product line of 3D printers and DDM systems (and related consumable materials) that create physical models from computer-aided design (CAD) designs. It also offer rapid prototyping and production part manufacturing services through its centers located in North America, Europe and Australia.

Confidence Margins

Strong resistance $55.66 (+55%)

Light resistance $45.32 (+34%)

Light support $31.79 (-6%)

Strong support $30.00 (-11%)

Recommendation

Stratasys Inc is a high technology company with a lot of future upside potential. This places the company in a position with a lot of potential for long term investors.

Entry strategy

For the cautious investor:

Buy the stock for 8.00$ or less.

For the risk-taking trader:

The September 2011 35$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 3.70$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 45$, or keep it until 55$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 45$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

The Comeback of the US Dollar?

The following graph of the US Dollar Index tells a story that can be summed up in the following terms. There seems to be change in sentiment regarding the way people perceive their positions relative to the US Dollar. This is all translating into a major change in the way Forex traders are positioning themselves regarding the future of the US Dollar.

Recent economic news on each side of the Atlantic have heavily influenced the strength of the American currency. In the US, it is clear that talks by the Federal Reserve to end of quantitative easing, QE2 on time, and that there probably is no QE3 in sight. Economic data on employment is improving and recent speeches by Fed's Chairman Ben Bernanke lead to think that the US economy is getting stronger.

Expect for the specific cases of Germany and France, economic data for Europe is coming in short of expectations and the continued Greek sovereign crisis is weighting on the Euro. As long as the market has no certainty as to what will happen with Greece's debt, forex investors will keep expecting the worse as time passes by and will fly back to the US Dollar.

Looking at the chart at the beginning of this post, there a long term reversal is in place for a comeback of the US Dollar that should last many weeks. Shorting the Euro and getting long on the US Dollar will prove to be a winning trade as long as a bond crisis still looms over Greece.

Google (NASDAQ: GOOG) is Releasing it's Chromebook

I recently fell on a pretty interesting article from the Street.com: The 5 Dumbest Things on Wall Street: May 13 - TheStreet. It is about major blunders made by big public companies or people employed by them.

I was mostly intrigued by the article relating to Google (GOOG) and their newly issued Chromebook, described by Google on the Chromebook website in the following terms:

A Chromebook is a mobile device designed specifically for people who live on the web. With a comfortable full-sized keyboard, large display and clickable trackpad, all-day battery life, light weight, and built-in ability to connect to Wi-Fi and mobile broadband networks, Chromebooks are ideal for anytime, anywhere access to the web. They provide a faster, safer, more secure online experience for people who live on the web, without all the time-consuming, often confusing, high level of maintenance required by typical computers.

It will come in two models, one manufactured by Samsung and the other by Acer and will be available on June 15th. The author of the article on TheStreet.com discusses the fact that the Chromebook comes at a time when mini-notebooks are simply outdated and that linking the product to a 3 years contract on a data plan was a silly move to take.

 

This point of view seems to be adopted a long time before the product has even had a chance to get going in the marketplace. The target costumers of the Chromebook are people who spend most of their time on the web and do not us their computer for much other use. Google seems to be targeting a niche market and it is reasonable to think that the people in the marketing department saw at least a medium term opportunity for Google.

These notebooks will be well adapted for people who are already accustomed to the Google product line but they still need to offer some features that many people are still looking for when acquiring a computer. First, Java is not supported by the Chromebook. If it is supposed to appeal to regular Internet users, this is a functionality that will have to be addressed.

The Chromebook doesn't yet support networks that require security certificates and this is an issue considering that most enterprise wireless networks are secured. As noted on TheStreet.com, it's not currently possible to transfer owner privileges of your Chrome notebook to another user account unless it is set back to back to it's set back to it's initial state, loosing all previously recorded data.

There are only some of the few drawbacks of the Chromebook but I am pretty sure it will provide Google with a business segment that will constantly expose it's users to the advertising distributed by the company, thus increasing revenues.

Full Disclosure: The author does not have a position in GOOG.

Homex Development Corp. (NYSE: HXM) Q3 2011 Price Target

Recent price: 25.52$

P/E Ratio: 10.75

3 Months Target Price: 29$

Company Description

According to Reuters, Homex Development Corp. is a home development company engaged in the development, construction and sale of affordable entry-level, middle-income and tourism housing in Mexico. During the year ended December 31, 2009, the Company sold 57,979 homes. As of December 31, 2009, it had 140 developments under construction in 34 cities located in 21 Mexican states. It had total land reserves under title of approximately 77.2 million square meters as of December 31, 2009, which include primarily land reserves in Mexico and approximately 750,441 square meters of land reserves for its operations in Brazil. Its land reserves include both titled land and land in the process of being titled. During 2009, 25% of its revenues were derived from the state of Jalisco and 21% from the Mexico City Metropolitan Area.

Confidence Margins

Strong resistance $32.60 (+28%)

Light resistance $28.97 (+14%)

Light support $24.85 (-3%)

Strong support $24.41 (-4%)

Recommendation

Homex Development Corp is the definitive play for a recovery of the Mexican housing sector. As of it's last quarterly filing on May 3rd 2011, the company reported growing sales and profits that came in line with what analysts were expecting. This is encouraging news and should be views as a signal that there is plenty of upside left in Homex Development shares by the end of the 3rd quarter of 2011.

Entry strategy

For the cautious investor:

Buy the stock for 26$ or less.

For the risk-taking trader:

The September 2011 30$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 95$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 29$, or keep it until 32$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 29$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Harmonic Inc. (NASDAQ: HLIT) Q3 2011 Price Target

Recent price: 7.76$

P/E Ratio: -

3 Months Target Price: 9.50$

Company Description

Harmonic Inc. designs, manufactures and sells video products and system solutions that enable service providers to deliver the broadcast and on-demand services, including high-definition television (HDTV), video-on-demand (VOD), network personal video recording and time-shifted television. It also provides its video processing solutions to telecommunications companies, or telcos, broadcasters and on-line media companies that offer video services. Its products fall into two principal categories: video processing solutions and edge and access products. It also provides technical support services to its customers worldwide. Its video processing solutions includes network management software and application software products. Its edge products enable cable operators to deliver customized broadcast or narrowcast on-demand and data services to their subscribers. Harmonic’s access products consist mainly of optical transmission products, node platforms and return path products.

Confidence Margins

Strong resistance $10.05 (+30%)

Light resistance $9.45 (+22%)

Light support $6.95 (-10%)

Strong support $6.37 (-18%)

Recommendation

Shares of Harmonic Inc fell sharply on May 29th as the company announced operating results for it's first quarter of 2011. Results and revenue guidance came under what analyst's were expecting and this caused the shares to follow a steep downtrend. Right now, as prices have stabilized, they provide a good entry point for the quarter that will end in November 2011.

Entry strategy

For the cautious investor:

Buy the stock for 8.00$ or less.

For the risk-taking trader:

The October 2011 10$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 25$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 9.50$, or keep it until 10$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 9.50$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Brightpoint, Inc. (NASDAQ: CELL) Q3 2011 Price Target

Recent price: 9.01$

P/E Ratio: 14.77

3 Months Target Price: 11$

Company Description

Brightpoint, Inc. provides supply chain solutions to the wireless technology industry. The Company’s primary business is moving wireless devices closer to, or directly into, the hands of mobile subscribers. Its business includes distribution channel management, logistic services, activation services and the sale of prepaid airtime. During the year ended December 31, 2009, the Company handled a total of approximately 83.5 million wireless devices. It handled approximately 64.3 million wireless devices through its logistic services business and approximately 19.2 million through its distribution business. The Company provides customized logistic services, including procurement, inventory management, software loading, kitting and customized packaging, fulfillment, credit services and receivables management, call center and activation services, Website hosting, e-fulfillment solutions, reverse logistics, transportation management and other services within the global wireless industry.

Confidence Margins

Strong resistance $13.22 (+46%)

Light resistance $11.20 (+24%)

Light support $8.15 (-10%)

Strong support $6.24 (-31%)

Recommendation

Even after Brightpoint Inc reported record numbers and a revenue outlook that came in better than what analyst's were expecting, shares of the mobile phone carrier have been severely hammered by the market. The prices created by this incomprehensible misfortune are great entry points and should yield excellent returns as soon as the market notices how undervalued this company has become.

Entry strategy

For the cautious investor:

Buy the stock for 9.50$ or less.

For the risk-taking trader:

The October 2011 10$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 300$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 11$, or keep it until 13$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 11$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Samson Oil & Gas Limited (AMEX: SSN) Q3 2011 Price Target

Recent price: 2.89$

P/E Ratio: 5.58

3 Months Target Price: 4$

Company Description

Samson Oil & Gas Limited is engaged in exploration and development of oil and natural gas properties in the United States. As of June 30, 2010, it had five material producing oil and gas properties. It does not operate any of its material, producing properties; rather, it owns a working interest in each property and has entered into operating agreements with third parties, under which the oil and gas are produced and sold. In June 2010, it agreed to sell 24,166 acres of undeveloped oil and gas leases in Goshen County, Wyoming to Chesapeake Energy Corporation. As of June 30, 2010, the Company’s properties included Jonah Field, Green River Basin, Wyoming; Look Out Wash Field, Green River Basin, Wyoming; State GC Oil and Gas Field, New Mexico; North Stockyard, Williston Basin, North Dakota, and Davis Bintliff, Brazoria County, Texas. It has one wholly owned subsidiary, Samson Oil and Gas USA, Inc.

Confidence Margins

Strong resistance $4.75 (+64%)

Light resistance $4.12 (+43%)

Light support $2.62 (-9%)

Strong support $2.11 (-27%)

Recommendation

As Samson Oil and Gas Limited is in a continued uptrend, this Australian company is very undervalued from a fundamental standpoint. Investors taking advantage of the current break the market is taking relative to shares of Samson Oil & Gas will reap good returns by the end of Q3 2011.

Entry strategy

For the cautious investor:

Buy the stock for 3.00$ or less.

For the risk-taking trader:

The October 2011 5$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 35$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 4.00$, or keep it until 4.75$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 4.00$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

MIPS Technologies, Inc. (NASDAQ: MIPS) Q3 2011 Price Target

Recent price: 8.17$

P/E Ratio: 18.40

3 Months Target Price: 15$

Company Description

According to Reuters, MIPS Technologies, Inc. is a provider of processor architectures and cores that power some of the home entertainment, communications, networking and portable multimedia products. The Company’s technology is used in markets, such as mobile consumer electronics, digital entertainment, wired and wireless communications and networking, office automation, security, microcontrollers, and automotive. MIPS customers are global semiconductor companies and system original equipment manufacturers (system OEMs). The Company’s business model is based on the licensing of embedded processor intellectual property (IP) in the form of both architectures and implementations. The Company has developed standards for both 32-bit and 64-bit computing. It licenses its MIPS32 and MIPS64 instruction-set architectures (ISAs), application specific extensions (ASEs), core designs and other related IP to semiconductor companies and system OEMs.

Confidence Margins

Strong resistance $18.19 (+122%)

Light resistance $15.03 (+83%)

Light support $7.80 (-5%)

Strong support $5.91 (-28%)

Recommendation

MIPS Technologies Inc is one of the most exciting positions of this quarter. As the company issued it's revenue guidance for the second quarter of 2011, analysts were very disappointed and so were the investors who surrendered their shares in the following days. As the stock has now reached the bottom, current prices provide investors with an attractive entry point that offers mouthwatering potential returns.

Entry strategy

For the cautious investor:

Buy the stock for 9$ or less.

For the risk-taking trader:

The October 2011 9$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 80$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 15$, or keep it until 18$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 15$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

Brigham Exploration Company (NASDAQ: BEXP) Q3 2011 Price Target

Recent price: 28.59$

P/E Ratio: 103.43

3 Months Target Price: 34$

Company Description

Data provided by Reuters tells us that Brigham Exploration Company is an independent exploration, development and production company that utilizes advanced exploration, drilling and completion technologies to systematically explore for, develop and produce domestic onshore oil and natural gas reserves. The Company’s exploration and development activities are focused in the Rocky Mountains, Onshore Gulf Coast, the Anadarko Basin and West Texas. During the year ended December 31, 2009, the Company drilled, completed 57 gross wells, consisting of two exploratory wells and 55 development wells with an average completion rate of 98%. The natural gas is sold to various purchasers, including intrastate pipeline purchasers, operators of processing plants, and marketing companies under both monthly spot market contracts and multi-year arrangements.

Confidence Margins

Strong resistance $37.87 (+32%)

Light resistance $34.45 (+20%)

Light support $28.07 (-2%)

Strong support $24.45 (-14%)

Recommendation

Brigham Exploration Company disappointed investors on May 4th when the company issued a statement providing guidance for the second quarter of 2011 that came short of what analysts were expecting. This sent the shares down and provided investors with a good entry point for a long term position in the company that will pay a bundle.

Entry strategy

For the cautious investor:

Buy the stock for 29.50$ or less.

For the risk-taking trader:

The October 2011 30$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 370$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 34$, or keep it until 37$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 34$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.

MKS Instruments, Inc. (NASDAQ: MKSI) Q3 2011 Price Target

Recent price: 26.75$

P/E Ratio: 9.77

3 Months Target Price: 34$

Company Description

MKS Instruments, Inc. is a provider of instruments, subsystems and process control solutions that measure, control, power, monitor and analyze critical parameters to improve process performance and productivity of advanced manufacturing processes. The Company also provides services relating to the maintenance and repair of its products, software maintenance, installation services and training. It groups its products into three product groups: Instruments and Control Systems; Power and Reactive Gas Products, and Vacuum Products. Its products are used in diverse markets, applications and processes. The Company’s primary served markets are manufacturers of capital equipment for semiconductor devices and for other thin film applications, including flat panel displays, light emitting diodes (LEDs), solar cells, data storage media and other advanced coatings. It also leverages its technology into other markets with advanced manufacturing applications.

Confidence Margins

Strong resistance $35.00 (+31%)

Light resistance $33.85 (+27%)

Light support $25.66 (-4%)

Strong support $23.09 (-14%)

Recommendation

Expect for the fact that the company announced results that were in line with what analyst's were expecting, It seems that shares of MKS Instruments are enormously undervalued at current prices. As time passes and the third quarter comes to an end, they will get back closer to their fair value, which will help current investors reap good returns.

Entry strategy

For the cautious investor:

Buy the stock for 27$ or less.

For the risk-taking trader:

The October 2011 30$ out-of-the-money call option contract seems to be the right position to take, they can be acquired for about 180$ per contract.

Exit Strategy

For the cautious investor:

Sell when the stock reaches 34$, or keep it until 35$ if you are more bullish in your own analysis.

For the risk-taking trader:

The contracts should be kept until the underlying reaches around 34$. This should provide a satisfactory return if the underlying reaches the target price as the contracts will get in the money.