- Microbix: MBX.TO, initial purchase on 2/17/2015, cost basis of $0.44
- Beam Interactive: BZIC, initial purchase on 4/7/2015, cost basis of $.011
- Luna Innovations: LUNA, initial purchase on 6/5/2015, cost basis of $1.01
- Ackroo: AKR.V, initial purchase on 7/13/2015, cost basis of $0.32
- Brekford: BDFI, initial purchase on 7/24/2015, cost basis of $0.22
Watch List: MZI.V, ENW.V, DDXS, OSS.V, STAF
Note: I owned STAF in early 2015 and sold for a roughly 80% profit in a matter of weeks. We saw profitability coming, and we jumped on board while the stock was completely undiscovered. Our cost basis of around $.0.29 was rewarded when we sold north of $0.75. After reaching levels of around $0.90, it has come back down and I am watching for a potential entry again.
I am glad to finally have UnusualStocks up and running and I am so glad to have you as a member! I look forward to great things to come.
Each Sunday a post will be published that will recap our portfolio and watch list positions, take a look at the price action in our positions from the past week, as well look ahead to the coming week to discuss any potential events that could move our stocks. The "Week in Review" post will also provide interesting article links and other information that I believe will be of interest to our members.
Without further ado... grab a cup of coffee and let's dig in!
Since this is my first post, here is a very brief history on each position I own. We will dig into a deeper analysis of the below names in the weeks ahead, with an article release on Brekford (BFDI) slated for Monday of this week.
Microbix (MBX.TO): Typically I avoid biotech and healthcare stocks because they are difficult for me to value, but Microbix is one that really appealed to me, mainly because of the company's infectious disease therapies. I feel like the stock is trading around the value of just the infectious disease therapy business unit. Lumisort and Kinlytic provide significant value once the company can commercialize the technology. All indications suggest this will happen soon.
Beamz Interactive (BZIC): If you follow me on twitter (which I hope you do!), you will be familiar with this one. A very special situation stock for me. I have gotten to know the CEO of the company and it's rare to come across a CEO with the passion and confidence in the future of the business than BZIC's CEO. In short, the company is re-inventing itself, eliminating all debt, completing a private placement, and then attacking the Healthcare and Education markets with its product and technologies.
Oh, by the way, the CEO and CFO are part of the team that took a former public company, iGo, Inc., from literally nothing to $100 million.
Luna Innovations (LUNA): Luna Innovations plays a major role in the fiber optic industry as well as the "strain and temperature control" fields. Without going into too much detail here, Luna helps companies save cost by using better materials to create significantly more efficiencies. The stock price has been held back by aggravated shareholders of Advanced Photonix, a company that Luna recently acquired. I believe we will see a very positive earnings report from the company this week that will lead to an advancement of the stock price. This one is being greatly mis-priced by the market.
Ackroo (AKR.V): Ackroo is a gift card, loyalty and rewards technology and service provider. You may have recently read analysis of the SaaS model and how it disrupting more traditional software deployment, it's a hot topic among some of the microchip guys on Twitter. The CEO has done a terrific job of inheriting a company literally in financial ruin and turning it around into a near-profitable company that it is today. We will dig into more details in a write-up on the company in the coming weeks. But, this is an exciting one.
Brekford (BFDI): Brekford is our most recent purchase and one that I am very optimistic about. The company provides all kinds of technology solutions to the public safety sector, from red-light traffic cameras to police body cameras to rugged vehicle uplifting for police and other public safety vehicles. I will have an article out on this one early this week, but I think this company is in the "sweet spot" of a huge underlying macro opportunity. And insiders own over 65%.
Events for the Upcoming Week for our Portfolio Names
The week ahead will bring earnings reports from LUNA (after close on Tuesday) and BDFI (likely Thursday after close, they haven't announced official date/time yet). I am anticipating these reports as it will be the first for LUNA in reporting combined numbers since its acquisition, and I am anxious to learn about body camera demand and progress toward profitability for BDFI. I also am looking forward to learning about an update to their international Mexico expansion.
Watch List Discussion
I am going to defer a discussion on the watch list names until later this week. If you have any immediate questions, simply email me at email@example.com or leave a comment below so that myself and other members can comment.
If you have any companies we want to add to our watch list, please let me know.
General Market Observations
I don't get too caught up in market commentary, not only because it generally doesn't affect our positions since institutions aren't invested in our companies, but also because all the market commentary you hear all day long on CNBC and other forums is nothing more than noise.
My quick take of the markets is that they are getting somewhat tired and will continue to be volatile. However, until there is more clarity on when the Federal Reserve will start raising rates, the market will likely continue to do what it has been doing for 5+ years and "melt up". There are variables, such as China, that could derail the "melt up" theme, as we have seen over the course of the past 3-4 weeks.
That's about the extent that I will offer any overall market commentary. The fact of the matter is NO ONE knows what the hell the market is going to do, and anyone that suggests they do probably offered the exact opposite prediction the week before.
The one thing I do pay attention to is the VIX. The below 1 year chart shows that when the VIX pulls back to the $10.50-12 level that a slight pullback has followed, thus the VIX has spiked. This has been a pretty consistent pattern and anyone making observations about the future short-term direction of the market should pay attention to the VIX.
That's all for this week. Looking forward to publishing our first research piece on a portfolio name sometime during the day tomorrow.
As always, feel free to reach out to me at firstname.lastname@example.org with any questions. I also encourage our members to leave comments below to engage other members and myself.
Have a great rest of your Sunday!