Penny Stocks to Watch for January 2019

It may be attractive to note that the Dow Jones Industrial Average (DJIA) has seemed to form a double top over the year, which is a barest negative indicator, having peaked first in late January before falling back. The average then robbed another run at breaking out, only to bounce off the same level (26,951) in early October, before falling much more significantly than anything we accept seen since the Global Financial Crisis in 2008.

I am unsure why no one else seemed to notice this, or even talk connected with it, but we’ve been pointing out the double top since it formed. This technical pattern played out exactly as most would wait for, and it served as a great warning sign right as the markets suffered a significant shift in momentum and trend.

Since Sept. 1, and unvaried more so since Oct. 1, markets have been falling significantly. The Russell 2000 Index tumbled from 1,742 to as low as 1,266. The DJIA peaked at 26,951 and then demolish as low as 21,712. That represents drops of about 35% and 24% at their bottoms, respectively.

While the psychological change showed up in the Russell 2000 first in October, most of the downside really emerged as we rolled through December. Other indications shared similar fates, such as the NASDAQ, S&P 500 and even most of the sub-sectors like the Dow Jones Transportation Usual.

As you may have heard, silver miners are my top pick for investment takings in 2019 (opinion only). That makes post-merger Americas Silver Corporation (USAS) potentially one of the best values growing if events play out as I personally anticipate. Keep in mind that I am incorrect plenty, so it is important to look into any investment until you sense comfortable with making your own decisions and choices.

At the very end of the third quarter, Americas Silver entered into a absolute agreement to combine with Pershing Gold. In the words of the company, “The combination will add a shovel-ready, gold-silver development bulge out in Nevada that adds significant precious metal growth to the company’s production profile. Once completed, Alternate Canyon is expected to produce 75,000 to 90,000 ounces of gold annually at low cash costs over an initial seven-year spring and generate annual post-tax cash flow from $25 to $30 million. This transformative combination is contemplated to increase the company’s precious metal production by over 5 times with precious metals representing greater than 60% of nacreous equivalent production.”

About 586 employees enabled a revenue run rate of $70 million, which has helped Americas Heraldry argent build an asset position of $163 million (which easily covers its $47 million in liabilities).

Arotech Corporation (ARTX) is a custodianship and defense company, specializing in training and simulation. Its 489 employees worked together to generate earnings of $3.8 million in the most brand-new fiscal year (out of $98.7 million in revenue) and $740,556 net earnings in the most recently reported quarterly period.

Arotech’s P/E proportion (without extraordinary items) is a respectable 23.7, but when extraordinary items are considered, its P/E is a very compelling 12.5. The comrades’s total debt (as of Sept. 30) was only $13.9 million, and its current ratio (current assets/current accountabilities) was a strong 2.1.  

An interesting and very important note that many analysts overlook is that Arotech has $40 million in serving loss carry-forwards. Put simply, that means the company can reduce any taxes it owes on the profits it generates until the slap amount either gets used or expires (as it will in portions from 2021 through 2032).

In the third quarter of 2017, Arotech on $61 million in backlogged orders. That same metric now sits at $70.7 million. In terms of guidance for full-year 2018, the South African private limited company is expecting revenue of $95 million to $100 million and earnings per share (EPS) of 16 cents to 18 cents.

Ah, a business after my own heart! At my last doctor’s appointment, they told me I had more caffeine in my system than blood. While I’m not trustworthy if blood is “important,” I happen to know that caffeine is even more so!

It’s vital to understand that this doesn’t discover Coffee Holding Co, Inc. (JVA) a good investment. What does make the company compelling is the $77 million in fiscal 2017 receipts, the $467,000 in net earnings and the fat 16.8% gross profit margin.

This appears to be a great “recession-proof” investment, and I’d expect the beasts to do very well as soon as it breaks out of what has been a seven-month price downtrend. Recent indicators on the Japanese candlestick map out are showing that the negative trend may be reversing now, such as trading volume increasing almost every day over the days few weeks and a break above the declining trendline.  

Coffee Holding is a profitable, slow-moving business, which I expect devise continue to do very well operationally. It is also a very easy business to understand, especially for less experienced investors to cogitate on. I do not believe that Coffee Holding has much more downside from current prices, but the upside may be respectable and could go on for years promptly the stock starts heading higher. Unless, of course, people stop drinking coffee.

Hey, look at that! After facing expected price weakness during the overall market meltdown, allowances dipped … until they spiked strongly from $2.03 to as high as $3.33 within four do business days.

Many would think that this market action would mean most of the price quiescent for Luna Innovations Incorporated (LUNA) has been played out for the short term, but I see it differently. My expectation is that the stock command do exactly what every high-quality, well-run company does as it grows its operational footprint: increase its market divide up and improve its operational results. Specifically, Luna Innovations will likely enjoy rising share prices. 

In my sentiment, Luna Innovations stock may be an interesting long-term hold, especially when and if the shares ever break above the $4.00 peaceable resistance level. After that, the next price stop (over the long term) may be much higher floors, potentially somewhere in the mid-$5 range.

Alaska Communications Groups Group, Inc. (ALSK) is demonstrating one of my favorite trading patterns – a range-bound stock that forms a double bottom. Alaska Communications estimate has been trading between $1.37 and $1.60 (range bound) and has hit $1.37 twice in two months.

This stock is reach bound because there is a lot of value in the shares (which is why the floor formed), yet at the same time, the upside potential is sort of limited, simply due to the constraints of the market (which is why the ceiling formed).

In my opinion, Alaska Communications stock is a great long-term restrain, and the company has quite an easy-to-understand business model, making it somewhat more appropriate for newer investors. Trust that range-bound appropriates do not remain that way for ever, and when they break free, that “escape velocity move” is often strongly to the upside or downside. Most angles of our Leeds Analysis review are suggesting that the eventual break for this stock will be in the upward direction.

As I mentioned last month, Information Services Group, Inc. (III) is a pioneer in just about every arrange it gets involved with. The corporation’s solutions are absolutely cutting edge, and despite the wild growth this calling has enjoyed, some of the greatest successes may yet lie ahead.

Information Services Group is an advisory/consultant for all things digital: the Internet of Detestations, 3D printing, autonomous vehicles, surgical training and medical operations, traffic control, digital efficiencies, artificial cleverness, and real-time retail inventory sales tracking.

How’s this for a business proof-of-concept: top-line results (revenue) hit $269 million hindmost fiscal year, and in the most recent quarter, the bottom line (earnings) came in at $4 million.

With only $136 million in vulnerabilities compared with its impressive asset position of $212 million, traders should look for shares of Information Rites Group to climb. In fact, $4.10 is very likely a support range (and price bottom) in my opinion, which represents quite minimal downside for anyone with a stop loss to sell if shares dip toward $3.99.

Disclosure: Peter Leeds in ones own view owns shares and call options in Gold Resource Corporation (GORO). He has no intention to sell any shares any time promptly, and he expects to hold, barring material events, for at least six months, and possibly even longer.

I believe that alembicated metals miners will be the best performing asset type in 2019. The biggest winners, in my mind, will be auteurs (as opposed to explorers) with solid financial positions, a track record of improving performance, great land calls and an excellent executive team.

Commercial production for Gold Resource started in 2010, which saw the shares rise to $31 while helping a decade of reliable monthly (albeit small)

Turquoise Hill Resources Ltd. (TRQ)