I Know First Review: April 9th 2014

April 22, 2014

The stocks selected here are the top performing stocks from I Know First: Daily Market Forecast’s April 9th 2013 forecast titled Aggressive Stock Forecast titled Quantitative Investment Based On Algorithms: 70.39% Average Gain In 365 Days. The I Know First Average return was 70.39% versus the S&P 500’s return of 19.78% over the same time period.

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Initiatives taken by the Alcatel (ALU) CEO Michel Combes who has repositioned the company has resulted in a gain of over 200% in one year due to his cost-cutting strategy decision to sell non-core assets has benefited and will continue to benefit investors. Gross margin for the last quarter increased by 400 basis points year-over-year to 34.3%. Alcatel is in a much better position than its rival Cisco (CSCO), which has been struggling since the break of the NSA spying scandal. ALU had a signal of 782.38 and a predictability of 0.27. In accordance with the algorithm, ALU grew 201.55%, becoming the largest gainer of the forecast.
Read our detailed assessment: Fundamental Strength And Algorithm Endorse Alcatel-Lucent

Citigroup Inc. (C) had a signal of 544.88 and a predictability of 0.27 on the forecast date. The stock rose 8.36% in accordance with the algorithm. Citigroup, which was rated the world’s second biggest foreign exchange firm by Euromoney’s magazine’s poll, seeing almost 15% of the $5.3 trillion flow that goes across the world’s largest market on an average day, says it could miss self-imposed profitability targets over the next two years. The reason is not actually with earnings but rather how return on the tangible common equity, the metric measures how much money a bank is making relative to the highest quality sliver of its capital, is calculated due to a rejection by the Federal Reserve to raise dividends and repurchase stock. The problem is that now Citigroup will now accumulate more tangible common equity than the bank had originally planned for. This is in addition to a legal settlement to pay $1.12 billion to resolve claims stemming from the sale of mortgage-backed securities prior to the financial crisis, ultimately shaving off $100 million off first quarter earnings.
Read our detailed assessment: Citigroup’s Competitive Advantage

Sify Technologies Limited (SIFY) had a long signal of 275.39 and a predictability of 0.26. The stock grew 8.9% as predicted by the algorithm. SIFY is an integrated Internet, network and electronic commerce services companies in India. The company’s services enable its business and consumers to communicate, transmit and share information, access online content and conduct business remotely using its private data network or the Internet.

OM Group, Inc (OMG) returned 42.12% in accordance with the algorithm. The company had a signal of 240.23 and a predictability of 0.23. OMG is a diversified industrial growth company serving attractive global markets, including automotive systems, electronic devices, aerospace, general industrial and renewable energy. The company operates in four segments including a Magnetic Technologies segment, an Advanced Materials segment, a Specialty Chemicals segment and a Battery Technologies segment.

DryShips (DRYS) had a signal of 213.78 and a predictability of 0.5 had a corresponding return of 78.6% in accordance with the algorithmic prediction. The company owns a fleet of 42 drybulk carriers (including new buildings), comprising 12 Capesize, 28 Panamax and 2 Supramax, with a combined deadweight tonnage of about 4.4 million tons, and 10 tankers, comprising 6 Suezmax and 4 Aframax, with a combined deadweight tonnage of over 1.3 million tons. Through its majority owned subsidiary, Ocean Rig UDW Inc., DryShips owns and operates 11 offshore ultra deep water drilling units, comprising of 2 ultra deep water semisubmersible drilling rigs and 9 ultra deep water drill ships, one of which is scheduled to be delivered to the Company during 2014 and two of which are scheduled to be delivered during 2015.

From the forecast date, Hewlett Packard Company (HPQ) shares rose 52.61% over the forecasted time horizon in accordance with the algorithm. HPQ had a signal of 240.8 and a predictability of 0.23. Hewlett Packard’s two essential businesses, printing and enterprise hardware ended the fiscal 2013-year strong. These two businesses account for 70%-75% of Hewlett Packard’s profit. The company will release 2Q14 earnings on May 21st 2014.
Read our detailed assessment: Hewlett-Packard: Positive Signs In Q1 2014 Results

Micron Technology Inc. (MU) has just closed a deal with Inotera Memories Inc. Inotera is a maker of DRAM memory and with the deal comes the prospect of MU approaching newer markets with its Taiwanese counterpart, thus achieving a larger market share. MU had an excellent year last year growing around 250% in 2013. Micron Technology had a signal of 70.08 and predictability of 0.22. In accordance with the algorithm the company returned 140.68% over the forecasted time horizon.

Yahoo! (YHOO) had a signal of 35.63 and a predictability of 0.28. The stock returned 48.51% as predicated by the algorithm. Despite loosing digital ad share to other online giants such as Google (GOOG) (GOOGL) and Facebook (FB), Yahoo! (YHOO) reported impressive revenue and earnings per share in its fourth quarter. Investors however were not satisfied that Yahoo!’s digital ad share has contracted in recent years. Yahoo has a stake in Alibaba Group Holding Ltd. Yahoo’s stake is estimated to be worth about $37 billion, a notable increase from the $1 billion Yahoo! invested in 2005. According to Bloomberg, Yahoo! is expected to sell of some of its stake when Alibaba goes public in the U.S. While this move would liquidate plenty of capital for Yahoo!, this is still a risky move.

Panasonic Corporation (PCRFY) had a signal of 29.33. The algorithm displayed confidence in this prediction, as the predictability indicator was very strong at 0.4. As the algorithm anticipated, PCRFY grew 67.84% over the forecasted time horizon. Panasonic recently announced the availability and pricing of the LUMIX GH4, the world’s first DSLM with 4K cinematic recording capabilities designed for both still photographers and cinematographers. It will be available at retail locations in May.

Halliburton Company (HAL) is an oilfield services company. The company is provider of services and products to the energy industry related to the exploration, development, and production of oil and natural gas. HAL reported $0.93 earnings per share (EPS) last quarter, beating the consensus estimate of $0.89 by $0.04. The company had revenue of $7.6 billion for the quarter, compared to the consensus estimate of $7.56 billion. During the same quarter in the previous year, the company posted $0.67 earnings per share. The company’s revenue for the quarter was up 4.8% on a year-over-year basis. On average, analysts predict that Halliburton Company will post $3.95 earnings per share for the current fiscal year. As predicted by the algorithm the company returned 54.75% from the forecast date. HAL had a signal of 25.59 and predictability of 0.24.

Selected stocks mentioned from this forecast are not an endorsement for making trading decisions with these assets currently. Please make trading decisions only with the most recent forecast.

Business Disclosure: I Know First Research is the analytic branch of I Know First, a financial startup company that specializes in quantitatively predicting the stock market. This article was written by Joshua Martin one of our interns. We did not receive compensation for this article, and we have no business relationship with any company whose stock is mentioned in this article.