I looked at hundreds of small cap stocks and the charts are all broken. Anything worth buying spiked 10% last week. This chart of Navient is an example. The stock wandered sideways for months while we owned it and then suddenly spiked 30% the last three days on the election news. It is going to be tough to find small cap stocks to own until there is some profit taking and consolidation.
NEW BULLISH Plays
FTK - Flotek - Company Profile
Flotek Industries, Inc. develops and supplies oilfield products, services, and equipment to the oil, gas, and mining industries in the United States and internationally. The company's Energy Chemistry Technologies segment designs, develops, manufactures, packages, and markets chemistries under the Complex nano-Fluid brand for use in oil and gas well drilling, cementing, completion, stimulation, and production activities, as well as for use in enhanced and improved oil recovery markets. This segment also constructs and manages automated material handling facilities; and manages loading facilities and blending operations for oilfield services companies. The company's Drilling Technologies segment inspects, manufactures, sells, markets, and rents down-hole drilling equipment that are used in energy, mining, and industrial drilling activities through direct and agent-based sales. Company description from FinViz.com.
In the Q3 cycle they reported a loss of 5 cents on revenue of $73.7 million. That was slightly more than the estimates for a 3-cent loss. Revenue estimates were for $79.5 million. The company explained their 16.2% decline in revenue saying there was a 43.2% reduction in the active rig count in Q3 compared to Q3-2015. In other words, their available business was cut nearly in half but they only recorded a 16% decline in revenue. That was actually a 1.0% increase sequentially from Q2.
Flotek services oil wells and especially new wells with their down hole products including their patented Complex nano-Fluid (CnF) technology that is used in fracking wells. Unlike fracking chemicals used by others, the Flotek CnF chemicals are completely non-toxic and have been proven to provide a slippery surface in the reservoir so that oil flows freely. This nontoxic chemical mix made from citrus oils is seen as a plus for producers constantly under fire for potential ground water contamination.
With rigs going back to work and drilled but uncompleted wells being brought online, the company said they were seeing signs of recovery in the sector. The drop in crude prices to $43 last week failed to depress the stock.
FTK has put in a bottom at $11 and could be ready to move towards the September highs at $16.
If OPEC actually announces some kind of production agreement on Nov 30th, the sector could respond aggressively.
Earnings Feb 1st.
Buy FTK shares, currently $11.71, initial stop loss $10.71.
No options recommended because of price.
NEW BEARISH Plays
No New Bearish Plays