Tuesday, December 18, 2012

Afterthoughts: Metrics for stock evaluation.

Here is from my recent experience:



My trading on this stock involves several buys and sells so far. Here is the trade history. In 12/14/12, I have two buys. As of 10/07/14, I still own the stock.

Buy On
At
Sell
On
At
Days
Return
Ann.
Return
12/14/12
  8.06
01/17/14
32.07
389
298%
279%
12/14/12
  8.06
01/08/14
30.00
380
272%
261%
04/24/14
18.48
06/17/14
20.11
  53
     9%
  61%
04/28/14
17.56
10/07/14
19.80
162
    13%
  29%









CAMP is a good stock to trade as the fundamentals were quite good most of the time. When the fundamentals are good, buy it. When they are bad, sell it.

I can tell the price and its P/E were exceedingly high in Jan, 2014 and that’s the reason I sold it besides qualifying for the long-term capital gain. On 1/17/14, the stock was high valued at $32.07 with P/E = 24 and RSI = 65. It was even higher valued at $32.80 with P/E = 104 and RSI=67. 

It looked like a double top to me in Jan. to March. A double top predicts a plunge. The price dropped almost half in April, 2014 and I picked the stock up two times at decent prices. From the chart, notice the double bottom, a technical indicator that predicts a surge.  Use the double top and bottom as a secondary indicator.

Today, the stock was up by about 20% after the earnings announcement. The forward P/E looks very decent and so is my Pow P/E (similar to P/E with cash and debt into consideration) with almost one dollar cash per share and only 1% debt/equity.

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