NGPS designs, markets and sells high-precision global positioning systems (GPS), a leading GPS devices and technology company in the world, has contracts with US, Canada, EURO, China, Indian, and more.
FA analysis:
Very solid company with PE ratio 16 and high growth margin and growth revenue. According to Quicken Stock evaluator, NGPS抯 Growth trends, Financial Health, Management Performance, Market Multiples and Intrinsic value are all the highest ranking. Earnings Growth 249.50%, Revenue Growth 40.90%, ROE 39.01%. Very low debt with high Asset/Liability ratio which is 3.445. Low float, only 3.5 M float and 20% are holding by Institution.
Reason why people pay attention to it: 1. NGPS was listed in Wall Street News Alert's U.S. Hot Stock Highlights, March 11, 2005 2. Also 揃ellwether Report Is Keeping a Close Watch on NGPS, BKST, UFPT and ANTP?on Market Wire, 28 March. 3. NovAtel Inc. Awarded Contract for SBAS Equipment for Indian GAGAN Program on March 8th, 2005 4. NGPS undergoing NAVY big contract: http://www.eps.gov/spg/DON/NAVAIR/N00421/N00421-05-T-0095/SynopsisP.html 5.Mar 10 reported very strong earning as well as good guidance in 2005: http://biz.yahoo.com/bw/050310/105192_1.html
Reason why it fall from $53 to $17? This is due to one major holder CMC electronic sold their shares. However, CMC already finished their sell off. Why I imply the CMC almost finished their sell off:
CMC Eletronic INC: Holding 3/18/2005 875,000 Sold 3/18/2005 408,939 Sold 1/11/2005 3,170,161 Sold 1/07/2005 1,462,161
CMC purchased 12/30/2004 accumulative holding: 4,694,500 shares, sold 4,622,322
These simple number shows CMC has only 875K in hand and they are not planning to sell at current price level (if they want to sell, they must sell on Mar 18 together with those 400K. Keep these 875K shares will let CMC still be one of NGPS holder and partner). Actually CMC is also a GPS device producer partnered with NGPS for a long time, in CMC抯 press release in 1998 (http://www.cmcelectronics.ca/En/About/contact_us_main_en.html), they mentioned that the Novatel is the leader in this area and their products are sophisticated and compatable. Since CMC accumulate almost 5M NGPS shares at the average price around $17 per shares, they sold 2M shares at $53 and 3M shares at $42 and 400K at $24. This profit taken action brought CMC total more than 300 Million proceed compared to CMC抯 enterprise value only 400 Million which means CMC increase its value with 6 month by 100%. What a big deal to CMC.
NGPS price dropped at the beginning of this year is purely due to CMC sell off, nothing to do with the company抯 business, so this stock is definitely oversold. Today Apr 5, it went down a little bit due to the profit taken since it has up for 5 straight days. Safe entry level here at $21 with low downside risk, will see at least $25 in the next couple weeks together with 120K shares short covered. NGPS has same trend and pattern as ANTP, gradually goes back to its underlying value after heavily sold.
Short term target $25 and midterm target $30.
-------------------- Disclaim: I don’t guarantee the accuracy of the information I post. All my posts are based on my own research. I am not a registered investment advisor and therefore I am not qualified to give you any investment advices. You Make Your Decision! Posts: 389 | Registered: Mar 2005
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