For his Price Volatility Volume portfolio, Covestor model manager William Smith uses a proprietary quantitative model to scan 8,000 stocks each day for overbought and oversold conditions that create investment opportunities. This portfolio’s current top holdings include Georesources (GEOI), Emcore (EMKR) and Northern Dynasty Minerals (NAK) (as of end of day 3/16).
On March 10, Smith added a position in Opnext (OPXT), a designer and manufacturer of optical components, modules, and subsystems for communications uses.
Smith was taking advantage of OPXT weakness, after it was dragged down last week by Finisar’s (FNSR) poor earnings
Helping drag down the group were shares of Finisar, off about 35.6% and shares of Opnextoff about 17.1% on the day.
In February, OPXT announced a vast improvement in quarterly revenues, though profitability continued to elude the company:
Revenue increased $21.0 million, or 27.6%, from $76.1 million in the quarter ended December 31, 2009.
…
Operating loss was $10.0 million for the quarter ended December 31, 2010, compared to an operating loss of $13.6 million for the quarter ended September 30, 2010. Non-GAAP operating loss was $5.3 million for the quarter ended December 31, 2010, compared to $9.8 million for the quarter ended September 30, 2010. The decrease in the non-GAAP operating loss primarily resulted from higher absolute gross margin and lower research and development expenses.
Despite the losses, the market cheered these results, as reported by Galaxy Stocks:
OPXT after opening at $2.38 hit record 52 week high price of $2.91 and then closed at $2.57 by scoring +29.15%. It traded 6.51 million shares which were more than average volume of 514,145.00 shares.
OPXT closed up 4.38% on Tuesday 3/16, despite the broad market downturn.
Sources:
“Finisar Flop Weighs Down Semiconductor Shares” MarketNewsVideo. Forbes, 3/9/11. https://www.forbes.com/2011/03/09/wednesday-sector-laggards-semiconductors-metals-mining-stocks-marketnewsvideo.html
“Opnext Reports Third Fiscal Quarter Unaudited Operating Results” Opnext, 2/3/11. http://investor.opnext.com/releasedetail.cfm?ReleaseID=547640
“Opnext Q3 Loss minimized, a Viewpoint for Q4 Positive Financial Results – NASDAQ:OPXT” Galaxy Stocks, 2/6/11. http://galaxystocks.com/5044/business-news/opnext-q3-loss-minimized-a-viewpoint-for-q4-positive-financial-results-nasdaqopxt/
