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SOURCE: Lombardi Publishing Corporation
In a recent Penny Stock Detectives article, editor Sasha Cekerevac argues that to be a successful investor in penny stocks, it helps to have two things in your favor: 1) a good fundamental story; and 2) positive technical analysis. Cekerevac notes that one of the more interesting penny stocks that fits these criteria is Energy Recovery, Inc.
New York, NY (PRWEB) July 09, 2012
In a recent Penny Stock Detectives article, editor Sasha Cekerevac argues that to be a successful investor in penny stocks, it helps to have two things in your favor: 1) a good fundamental story; and 2) positive technical analysis. Cekerevac notes that one of the more interesting penny stocks that fits these criteria is Energy Recovery, Inc.
“This firm makes equipment that is used in seawater desalination,” explains Cekerevac. “The company’s products allow the ability for desalination plants to recycle fluids that would have been wasted. Not only does this reduce global emissions, but it also lowers costs for the end client.”
Energy Recovery reported mixed first-quarter 2012 results. On the top line, revenue was down significantly from last year due to several large mega-projects last year that make year-over-year comparisons difficult, notes Cekerevac. The firm did say that it expects to close many of its large mega-projects later this year. In addition, the firm’s gross margins were up substantially to 26% for the quarter, up from one percent in the 2011 fourth quarter. The company is also rare amongst penny stocks in that it has a share repurchase program. As of May 1, 2012, the company has bought 1.2 million shares, Cekerevac reports.
On June 5, 2012, Energy Recovery was awarded a contract for a large-scale desalination plant using its energy recovery devices in the United Arab Emirates. The Middle East will continue to be a large market for desalination plants, believes Cekerevac. It’s important for Energy Recovery to develop and maintain happy customers, as this can be translated into long-term contracts for its products.
“Penny stocks with long-term contracts are always more attractive, as it makes it that much easier to forecast future revenue,” Cekerevac explains. “The technical analysis also shows that investors find the prospects favorable. Penny stocks with an attractive technical analysis foundation are usually on my radar screen.”
Technical analysis of the stock shows some interesting formations. It is quite likely that the stock will trade in a “box” comprised of these ranges: $2.30–$2.60. The next level of resistance if the stock breaks above $2.60 is just below the $3.00 area.
Penny stocks need both good fundamentals and solid technical analysis before they can move higher, in Cekerevac’s opinion.
“This is because while the story might be sound, if not enough investors buy the shares, the price doesn’t move up,” argues Cekerevac. “Talk is cheap and technical analysis tells us what investors are doing with their hard-earned cash.”
To see the full article and to learn more about Penny Stock Detectives, visit http://www.pennystockdetectives.com.
The editors of Penny Stock Detectives believe low-priced stocks, when researched properly, present investors with great opportunities to accumulate wealth and to increase the value of their investment portfolios. You can learn more about Penny Stock Detectives at http://www.pennystockdetectives.com.
For the original version on PRWeb visit: http://www.prweb.com/releases/prweb2012/7/prweb9680170.htm
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