Quick Win by the Algorithm: Clear Strategy and Acquisition Key For KEM

Quick Win by the Algorithm

On December 25, 2016,  the I Know First algorithm had predicted a bullish forecast for Kemet Corporation (KEM). It had a signal of 167.47 and a predictability of 0.57. The company reported gains of 71.09% in just 3 months and therefore, a quick win by the algorithm

KEMET Corporation, together with its subsidiaries, manufactures and sells passive electronic components under the KEMET brand worldwide. The company operates through two segments, Solid Capacitors, and Film and Electrolytic. Its products include tantalum, multi-layer ceramic, film, electrolytic, paper, and solid aluminium capacitors, as well as EMI filters. The company offers its capacitors for use in the automotive, communications, computer-related, industrial, consumer, military/aerospace and alternative energy industries.

With fiscal 2017 third quarter results released, KEM recorded net sales of $188 million, up 0.4% from the previous quarter. More promising was the fact the quarter was the fourth of sequential growth and the highest revenue since the first quarter of ’16. A more defined strategy and focus on key aspects such as the sales division, was instrumental in boosting the overall quarter performance.

Investor confidence was high, after analysts increased the stocks target price. Additionally, the market was very receptive, after Kemet announced plans to acquire NEC Tokin Corporation. The acquisition is for an estimated $52.5 million, plus half of the excess net cash NEC will receive through the sale of its EMD business.  These factors helped contribute to KEM’s stock performance.

This bullish forecast on KEM was sent to current I Know First subscribers on December 25, 2016. 

Before making any trading decisions, consult the latest forecast as the algorithm constantly updates predictions daily. While the algorithm can be used for intra-day trading the predictability tends to become stronger with forecasts over longer time-horizons such as the 1-month, 3-month and 1-year forecasts.