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Stocks in the
Spotlight
"PRESENTS"
April 13, 2015
zooooM-Zoooom
Fonar Corporation
52 Week Range - 9.32 - 18.00
Fonar Corp., Inc. (FONR
), now
at $12.22. Fonar Corp. makes the only stand up MRI scanner anywhere. The
original Fonar MRI is in the Smithsonian Institute as Fonar made the
very first MRI scanner.
The stock Zoomed from under $10 to over $27 and Zoomed right back down.
Three +
years ago (11/28/11) the Stocks in the Spotlight recommended buying
Fonar at $1.68. A year later (11/28/12) we recommended buying
Fonar at $4.82. Again a bit over a year later (1/13/14, Fonar hit
$27.95 and for the first time in a long time the stock was too high to buy.
For
the 6 months ending 12/31/2014
Fonar reported a net income of $6.7 million on revenues of $35.1
million as compared to net income of $6.7 million on revenues of $34.4
million for the six month period ended December 31, 2013.
Operating income declined, by 4.2% from $7.3 million for the six month
period ended December 31, 2013 to $7.0 million for the six month period
ended December 31, 2014.
For the three month period ended December 31, 2014
Fonar reported net income of $3.5 million on revenues of $17.1 as
compared to net income of $3.0 million on revenues of $17.6 million for
the three month period ended December 31, 2013.
Net Income Available to Common Stockholders for 2nd Quarter Fiscal 2015
increased 24% to $2.5 million versus the same period a year earlier.
Diluted Net Income Per Common Shares Available to Common Stockholders
increased 21% to $0.40 per share for 2nd Quarter Fiscal 2015 versus the
same period a year earlier. This gives Fonar a PE of about 8 to 1 when near $13.
With the markets so overbought it has become increasingly hard to find a true value:
- It has to be a stock trading nearer to the low end of the trading range;
- It has to have a range wide enough to make it worth while;
- It has to be a real value trading with a PE lower than average;
- It has to be in an exciting industry;
- It has to have a good story and a good reason to trade higher;
- It has to have growing revenues and earnings;
- It has to have a product with a strong future.
You get all of this when you become a FONR shareholder.
I am becoming more
bearish almost daily on the market. The bull has been in charge for a
long time now and even bulls get tired. The thought that the markets
are going to climb forever is a ridiculous idea and we need to get it
out of our head that it will.
When there is so much investor confusion, growing investor fear and
stocks with mega profits, selling small amounts to be safe and putting
it in a bargain like FONR makes a lot of sense.
I believe that even with a major correction FONR is so near
the low it will have less to fall and since it is already undervalued
it will only become a better BUY. This stock at least doubles once
almost every year and it could happen again this year. It does have a tendency to
move on it's own and not with the rest of the markets.
Although
lately the stock seems to be moving with the markets. Just from
February the stock has moved from just under $11 to just over $14
before easing back to around the $13 level before falling in 1 day to
the current $12.22.
The
best reason I can offer is the stock has been played by the same
brokers/institutions every year and once it starts climbing everyone
wants in at once. This causes the up fast, which is again the reason
for the down fast.
When
a stock moves up too fast it doesn't have the opportunity to build
support levels on the way, therefore nothing in the way when profit
takers come in and down it comes.
This
makes this stock a very good one to own, as your risk, at
near low levels, is almost nil. We just have to be aware that if it
climbs too fast we have to say so long, adios, farewell & good bye.
Remember, there are 2 things we do not want to miss out on, the bottom and the top, and we can't have one without the other.
Buy anything under $12 is best but $13 will work just fine. You can relax even if the big correction starts sooner than later.
My
top of the range would be $27.00, or 17 times eps. My "bargain"
price would be under $12.
Buy anytime near $13 or better!
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