Tag - :SXCI

Dow 10,000 is less than 100 points away this morning. Who'd a thunk it? Just 6 months ago, when the Dow closed at 6,547 on March 9, it seemed as though the world was coming to an end.

You might have thought I had gone off the deep end when my Daily Profit from March 9, 2009 hit your inbox with the headline "Upside for Stocks?" And the following day, March 10, I even included a list of stocks you might have considered buying for the rally that was starting. Since then, Graham Corp (AMEX:GHM) has rallied 90% and SXC Health Solutions (Nasdaq:SXCI) is up 162%.

You might still think I'm a little nuts calling for the Dow to hit 10,500 before this year is over. But with money still cheap, economic data still improving and stock valuations that are reasonable if forward earnings estimates prove accurate, that there may be more upside isn't a crazy idea...

Tongxin International Ltd. (Nasdaq:TXIC), SmartHeat Inc. (Nasdaq:HEAT) and City Telecom Depository Receipt (Nasdaq:CTEL) are among the new 52-week highs in Wednesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Valassis Communications Inc. (Nasdaq:VCI), GHL Acquisition Units (Nasdaq:GHQ.U), Sourcefire Inc. (Nasdaq:FIRE), Alliance Financial Corp. (Nasdaq:ALNC), SXC Health Solutions Corp. (Nasdaq:SXCI) and China Green Agriculture Inc. (Nasdaq:CGA).

SXC Health Solutions Corp. (Nasdaq:SXCI), Home Inns & Hotels Management Inc. (Nasdaq:HMIN) and Silicom Ltd. (Nasdaq:SILC) are among the new 52-week highs in Thursday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Fuqi International Inc (Nasdaq:FUQI), US Auto Parts Network Inc. (Nasdaq:PRTS), IncrediMail Ltd. (Nasdaq:MAIL), Evercore Partners Inc. (Nasdaq:EVR), Charlotte Russe Holding Inc. (Nasdaq:CHIC) and SPSS Inc. (Nasdaq:SPSS).

Stocks are down as of press time, 12:00 P.M. Eastern. The Dow is down 17.08 points at 9,263.89; the Nasdaq is at 1,979.74 and quickly retreating from it's Tuesday closing high of 2,009.40; and the S&P 500 is down below 998.82.  

Most active small-cap decliners in the morning session include Orthovita (Nasdaq:VITA) down 29%; Health Fitness Corporation (AMEX:FIT) down 26%; and Sunrise Senior Living (NYSE:SRZ) down 23%. 

Small-caps bucking the trend and actively rising include a former SmallCapInvestor.com PRO holding, SXC Health Solutions (Nasdaq:SXCI) up 28% on reporting Q2 2009 EPS numbers 41% higher than the year ago period and raising guidance for 2009 with an EPS of $1.70, up from $1.62.  

Other small-cap gainers in the morning session include Home Inns & Hotels Management (Nasdaq:HMIN) up 25% and Ambac Financial Group (NYSE:ABK).

*****Yesterday, the Challenger jobs report showed more jobs were lost in July than expected. It wasn't a big miss, but it was a miss. And after buyers stepped in early, the market's reaction wasn't a big one, either. By the end of the day, the Dow Industrials lost 30-some points.  

I've been pointing out how the market just doesn't seem to have much downside. Yesterday's job loss news wasn't a disaster, but it wasn't good. But investors stepped in and pushed stocks well off their lows.  

The Fed has made money cheap, and it's going into the stock market. There's been a lot of talk that there's a stock market bubble in China because investors there are putting money from government stimulus efforts into the stock market. Nobody's saying that about the U.S. stock market, but that is what's happening. 

This is the "false trend" I was referring to with the George Soros quote from the other day. We should understand that this trend will most likely be proved false at some point. The question is, when? 

*****Today, jobless claims came in lower than expected. That's going to put stocks on better footing. Of course, continuing claims rose. But investors are having the sense that the U.S. economy is stabilizing, so they are buying stocks.   

In my Recovery Portfolio, I'm about to lock in a virtually risk-free 14% gain on drug maker Wyeth (NYSE:WYE). Pfizer (NYSE:PFE) announced that it would acquire Wyeth on January 6 in cash and stock deal. I bought Wyeth when Pfizer stock was low. My purchase price was essentially locked in by the acquisition terms. There was nothing but upside. And as Pfizer has recovered along with the market, my investment in Wyeth has done well.  

If you'd like to learn about the "aggressive approach to conservative investing" that's driving my Recovery Portfolio, please click here. 

*****Cisco (Nasdaq:CSCO) CEO John Chambers is one of the best CEOs there are. He's a straight-shooter, telling investors "…not to get too far ahead of themselves…" concerning Cisco's earnings report and forecast.  

In a nutshell, the last quarter was pretty good for Cisco, but the company still faces challenges. His advice is valid for all investors. Just check the retail sales data out this morning. The economy may be stabilizing, but retail is experiencing challenges. Sales were down around 5% across the board. And that trend has been in place for months.  

Let's not get too far ahead of ourselves.  

******Treasury Secretary Timothy Geithner claims the government made a 23% profit on its bailout of Goldman Sachs (NYSE:GS). Now, Morgan Stanley is about to buy back a warrant it sold the government for $950 million.  

There's no word what the government's profit is on this, but there should be no doubt that there is one. And that's how it should be, so far as I'm concerned.  

If these banks need money, the government shouldn't be a lender of last resort. It's an investor, and should be rewarded. And don't forget, favorable government policies are allowing banks to profit. So again, the government should be rewarded for the risk it takes.  

*****Yesterday, my first monthly column appeared in The Burlington Free Press, the daily newspaper in the state of Vermont. The first column is Investing in Vermont: Profits await clean energy investors. In this column I discuss investing in the clean energy sector, and offer readers three ideas - including two mutual funds and one ETF. You can read the column by clicking here.  

*****The Managed America web video conference is coming up next Monday, August 10 at 6:00 P.M. It's free to attend and you can register right now. Click here to register for this free online event.  

Ian Wyatt

Editor

Daily Profit 

P.S. Don't forget that with tomorrow's edition we'll once again bring back Jason Cimpl, lead technical analyst from TradeMaster Daily Stock Alerts to give you his assessment on the market and his call for next week's trades. You can catch a replay of last Friday's video: click here.

Interactive Intelligence Inc. (Nasdaq:ININ), Noven Pharmaceuticals Inc. (Nasdaq:NOVN) and Stein Mart, Inc. (Nasdaq:SMRT) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Ardea Biosciences Inc. (Nasdaq:RDEA), Books-A-Million Inc. (Nasdaq:BAMM), Clearwater Paper Corp. (Nasdaq:CLW), Hi-Tech Pharmacal Inc. (Nasdaq:HITK), Global Consumer Acquisition Units (Nasdaq:GHC.U) and SXC Health Solutions Corp. (Nasdaq:SXCI).

TM Entertainment and Media Units (Nasdaq:TMI.U), Books-A-Million Inc. (Nasdaq:BAMM) and ICU Medical Inc. (Nasdaq:ICUI) are among the new 52-week highs in Thursday's trading among companies with market capitalizations under $1 billion.

KongZhong Corp. (Nasdaq:KONG), Great Southern Bancorp Inc. (Nasdaq:GSBC) and Stein Mart, Inc. (Nasdaq:SMRT) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: SXC Health Solutions Corp. (Nasdaq:SXCI), Symmetricom Inc. (Nasdaq:SYMM), NeurogesX Inc. (Nasdaq:NGSX), STEC Inc. (Nasdaq:STEC), Central Garden & Pet Co. (Nasdaq:CENTA) and Spartan Motors Inc. (Nasdaq:SPAR).

Stocks are extending losses seen Monday as earnings week kicks off on a low note.

At 11:52 am ET, the Russell 2000 (NYSE:IWM) is down 7.3, or 1.63%, at 440.26, while the Dow is down 2.05% at 7,812.73 and the S&P 500 is down 1.75% at 820.82.

Aluminum giant Alcoa will kick off earnings season Tuesday after the close of the market. The company is expected to report a loss and set the tone for dismal results to come. Financial stocks helped push the market lower Monday, and are likely to remain under pressure in the coming days as investors brace for more losses.

But not everyone was in the red today. Small-cap restaurant chain Benihana Inc. (Nasdaq:BNHN) is up 9% after reporting an increase in total and comparable sales for Q4 and full year 2009, while First Niagara Financial Group (Nasdaq:FNFG) is up 13% on news the small cap will buy 57 branches from a unit of PNC Financial. Also rising today is biopharmaceutical company Oncothyreon Inc. (Nasdaq:ONTY), 14% higher on heavier-than-average volume.

******I sure hope SCI Daily readers bought some shares of Graham Corp. (AMEX:GHM) when I suggested it in the March 19 edition. Graham closed at $9.33 that day. Today, it’s pushing $11 a share for a 16% gain.

Graham is exactly the type of stock I love. It’s in an important sector (oil services), it has a pristine balance sheet with virtually no debt, it generates plenty of cash and it has a solid backlog.

Graham is rallying now because it is announcing new orders — $6 million worth in the last week. That may not sound like much, but when you’re doing around $100 million a year, $6 million is significant.

Among other things, Graham helps oil refiners retrofit their equipment so it can handle heavy or “sour” crude, like what comes from oil sands production. Oils sands production is more expensive than the oil we get from OPEC. Oil sands companies are break even with oil in the $50 range.

Graham hit $54 a share when oil prices were hitting their highs. Oil sands production was ramping up and refiners were investing to accommodate that supply. But when oil prices dropped, investors thought Graham’s business would drop. It has, but not as much as expected.

Now that oil prices have found some stability in the $50 range as expectations . . .

AsiaInfo Holdings Inc. (Nasdaq:ASIA), ImmunoGen Inc. (Nasdaq:IMGN) and Monro Muffler Brake Inc. (Nasdaq:MNRO) are among the new 52-week highs in Thursday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Neutral Tandem Inc. (Nasdaq:TNDM), Hot Topic, Inc. (Nasdaq:HOTT), Kirklands Inc. (Nasdaq:KIRK), SXC Health Solutions Corp. (Nasdaq:SXCI), America Service Group Inc. (Nasdaq:ASGR) and Santa Monica Media Corp. (Nasdaq:MEJ).

Stocks are holding their ground through Tuesday trading as financial and homebuilder stocks stayed firm following a positive housing starts report.

At 1:49 pm ET, the Russell 2000 (NYSE:IWM) is up 9.37, or 2.43%, at 395.73, while the Dow is up 1.29% at 7,309.76, and the S&P 500 is up 1.83% at 767.68.

This morning the Commerce Department reported that construction of new homes and apartments jumped 22.2% from January to a seasonally adjusted annual rate of 583,000 units. Economists were expecting construction to drop to a pace of around 450,000 units.

Small cap on the move today include Star Bulk (Nasdaq:SBLK), up 20% as the company’s Q4 net soars on bigger fleet. SkillSoft Public Limited Company (Nasdaq:SKIL) is also 24% higher today following a Q4 earnings boost.

Universally Reviled

I have never seen a company more determined to make itself universally reviled than AIG. It truly boggles the mind that anyone at AIG, especially those in the financial products division that lost $62 billion on credit default swaps in the fourth quarter alone, could think they should receive a bonus.

I don’t care what the contract says — if you’re party to losing $62 billion in a three-month span, you get no reward. Sorry. And if you even have to ask if bonuses can be paid with bailout money that’s keeping your business going, your moral compass is seriously out of whack.

And it doesn’t end with the bonuses. Of the $170 billion American taxpayers have dumped into the bottomless pit that is AIG, $106 billion was paid out in settlement for the credit default swaps that AIG guaranteed.

$11.92 billion to France’s SocGen, $11.8 billion to Deustche bank and $12 billion to Paulson’s own Goldman Sachs. Well, isn’t that nice. We’ve paid off foreign banks, and our former Treasury Secretary made sure his alma mater got its payoff, too.

This is dirty business. And if Paulson knew the extent of Goldman’s exposure to AIG, and it’s impossible to think he didn’t, he needs to be called to . . .

Stocks opened in the green and are continuing their positive trot through midday, buoyed by Tuesday’s news that beleaguered Citigroup (NYSE:C) is operating at a profit.

At 12:27 pm ET, the Russell 2000 (NYSE:IWM) was up 1.39, or 0.38%, at 369.14, while the Dow was up 0.02% at 6,927.77, and the S&P 500 was up 0.22% at 721.18.

Like Tuesday, financial stocks are leading the markets higher today on the Citigroup news, while tech stocks are also seeing a boost after large-cap benchmark Hewlett-Packard’s rating was upgraded.

While the market seems to be in recovery mode, don’t relax just yet. Analysts are warning that the rally will be short-lived and that there remain deep problems etched within the banking industry.

Small-cap stocks trending upward today include On Assignment, Inc. (Nasdaq:ASGN), 23% higher on lower-than-average volume, and YRC Worldwide Inc. (Nasdaq:YRCW), which is 11% higher despite making Moody’s “Bottom Rung List.” Axsys Technologies (Nasdaq:AXYS), a manufacturer of defense surveillance and imaging systems, is up 34% after the small cap put itself up for sale in an auction that drew a first round of bids earlier this week.

Global Markets Up …

Finally, early strength for stocks on Tuesday didn’t turn to weakness. In fact, . . .

Stocks are flying high at midday today on news that Citigroup (NYSE:C) reported it was profitable for the first two months of 2009.

At 1:27 pm ET, the Russell 2000 (NYSE:IWM) is up 19.94, or 5.81%, to 363.20. The Dow is up 4.27% to 6,826.77, and the S&P 500 is up 5.06% to 710.76.

Also helping stocks make large moves today was news that Congressman Barney Frank, chairman of the House financial services committee, said he expects the restoration of a rule that makes it harder to bet that a share's price will fall. Investors were encouraged by Frank's comments.

Financial stocks are in rally mode today following statements made by U.S. Treasury Secretary Timothy Geithner on Monday that the United States has taken more economic action in recent weeks than most countries have in years to ease strife.

Small caps seeing double-digit gains today include Gaylord Entertainment Company (NYSE:GET), up 33% after a proxy deal, and AM Castle (NYSE:CAS), which topped Q4 views and declared a $0.06 per share dividend, sending shares 42% higher.

Stocks up strong

Once again, early strength for stocks yesterday quickly turned to weakness. There is a battle going on between the bears and the bulls. Despite all time lows for consumer sentiment, there is a growing number of analysts and market strategists who believe a rally is at hand.

We’ve been seeing signs of a rally for a couple weeks now. That’s why . . .

Stock market news, commentary and analysis from Chief Investment Strategist Ian Wyatt.

Children's Place Retail Stores Inc. (Nasdaq:PLCE), Orion Marine Group Inc. (Nasdaq:OMGI) and Ciena Corp. (Nasdaq:CIEN) are among the biggest percentage gainers in Thursday's trading among companies with market capitalizations under $1 billion.

Also included among the results: SXC Health Solutions Corp. (Nasdaq:SXCI), DrdGold ADR (Nasdaq:DROOY), Fred's Inc. (Nasdaq:FRED), Sterling Construction Co Inc. (Nasdaq:STRL), Seabridge Gold Inc. (Nasdaq:SA) and Genesco Inc. (Nasdaq:GCO).

Stocks extended losses during midday trading today, pushed down by poor housing data and by lackluster comments from Fed Chairman Ben Bernanke.

At 12:01 pm ET, the Russell 2000 (NYSE:IWM) was down 6.17, or 1.68%, at 361.63, while the S&P 500 is down 0.79% to 695.25 and the Dow is still below 7,000, currently down 0.46% at 6,732.23.

According to new data released by the National Association of Realtors this morning, the number of homebuyers purchasing existing homes fell 7.7% to a new low of 80.4 in January. Economists were predicting a January reading of 85.1.

Also this morning, Bernanke reiterated to Congress that any semblance of economic recovery hinges on the U.S. government’s ability to stabilize ailing financial markets. The comments did little to soothe investor fears.

Small caps seeing solid rises today included Bruker Corporation (Nasdaq:BRKR), up over 6% after releasing Q4 2008 results and issuing FY 2009 revenue guidance above analysts’ predictions. Also Southern Community Financial Corp. (Nasdaq:SCMF) is up 20% on very light volume, and Einstein Noah Restaurant Group (Nasdaq:BAGL) is up 18% after its Q4 EPS beat the Street.

On the downside, ICT Group careened 23% after rejecting Aegis’ acquisition offer.

Lending Profits

It is a strange sight to see the Dow Industrials trading at 6,700. That’s still a level from 1997. And it still indicates that people don’t want to own stocks. At this point, it seems to be as much about available capital for investment as a willingness to invest.

Valuations are low, the Dow is trading with a P/E of around 20. But that’s still not as low as it’s been during past recessions.

Still, it might be helpful to add some flavor to the current P/E ratio of the Dow. Consider that Citigroup and Bank of America don’t have earnings. Neither do Ford, GM, Alcoa. It’s safe to say that earnings at JP Morgan, American Express, . . .

Stocks were sharply lower at midday on news this morning that small-cap insurer American International Group Inc. (NYSE:AIG) posted the largest quarterly loss in U.S. corporate history, down $61.7 billion in Q4.

At noon the Russell 2000 (NYSE:IWM) was down 15.25, or nearly 4%, at 373.77, while the S&P 500 was down 3.66% to 708.15, and the Dow was down 3.25% to a staggering 6,833.54 — the first time the index has dipped below 7,000 in 11 years.

Myriad data reports out today showed personal spending rose about 0.6% in January and incomes rose 0.4%, while construction spending fell 3.3%, or more than twice as much as analysts predicted. Even though manufacturing contracted in February for the thirteenth straight month, the pace was slower than expected.

Small caps bucking the downward trend this morning included business service outsourcer ICT Group, Inc. (Nasdaq:ICTG), up nearly 70% after Aegis Limited made an acquisition proposal to ICT’s board. FGX International Holdings Limited (Nasdaq:FGXI) is seeing an 18% uptick following a strong sales and earning release late last week, and Noven Pharmaceuticals is up 10% ahead of its scheduled earnings release on Thursday.

On the downside, Ship Finance International (NYSE:SFL) is down over 23% after reporting a Q4 loss last week.

A Caveman could do it

*****Warren Buffett’s annual report for Berkshire Hathaway was released over the weekend. His letter to his shareholders is one of the most widely read investment documents there is. Buffett’s down home charm, inviting sense of humor and investment savvy are always a great read...

Here’s what’s going in stocks:

Stocks were higher at midday Thursday as the Obama administration increased efforts to aid browbeaten banks in the weary financial sector.

At 11:51 am ET, the Russell 2000 (NYSE:IWM) is up 1.96, or 0.49%, to 403.40, while the Dow is up 0.78% to 7,327.68 and the S&P 500 is up 0.55% to 770.67.

Though Congress has already set aside $700 billion for embattled banks, President Obama has now proposed a $3.55 trillion budget that will allot $750 billion more to struggling financial firms. The plan, which is being sent to Congress today for approval, predicts that the U.S. government’s 2009 deficit will be $1.75 trillion.

Earlier today, investors analyzed tepid news out on the data front. This morning the Commerce Department released a consumer report that showed orders for big-ticket goods plunged by a larger-than-expected 5.2% in January as global economic troubles continue to cut into demand from U.S. and global customers. The report showed that orders have fallen for six straight months, and that orders for autos, metal products, machinery, computers and electrical equipment and household appliances predominantly posted declines.

The Commerce Department also released new-home sales numbers, which fell to a record low pace — 10.2% — in January to 309,000. This is the worst number on record since 1963. Prior to the release, the all-time low had been set in September 1981.

In other data out this morning, the Labor Department said continuing jobless claims hit a new record in the second week of February, increasing 114,000 to 5.113 million, over the forecast for 5 million.

SXC Health Systems

While Bernanke’s testimony before Congress on Monday was far more significant than any specifics Obama mentioned Wednesday night, neither event seems to be affecting stocks much. Except for HMO stocks. They’ve been killed this week as Obama makes a push for healthcare reform.

Medical insurers could be hurt by healthcare reform, though I doubt anyone feels particularly bad for these companies. I do think, though, that regardless of potential reform, there’s still some phenomenal upside for certain healthcare and biotech stocks.

My current favorite is SXC Health Systems (Nasdaq:SXCI). This small cap helps process prescription transactions. And its technology was involved in nearly 25% of the 3.5 billion prescriptions processed last year. Obama’s push to digitize . . .

HMS HLDGS Corp. (Nasdaq:HMSY) and SXC Health Solutions Corp. (Nasdaq:SXCI) are the new 52-week highs on Wednesday's session.

Lincoln Educational Services Corp. (Nasdaq:LINC), SXC Health Solutions Corp. (Nasdaq:SXCI) and America Service Group Inc. (Nasdaq:ASGR) are among the new 52-week highs in Monday's trading among companies with market capitalizations under $1 billion.

Ocwen Financial Corp. (Nasdaq:OCN), Optimer Pharmaceuticals Inc. (Nasdaq:OPTR) and Life Partners Holdings Inc. (Nasdaq:LPHI) are among the new 52-week highs in Wednesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Lannett Co Inc. (Nasdaq:LCI), Village Super Market Inc. (Nasdaq:VLGEA), Citizens Inc. (Nasdaq:CIA), SXC Health Solutions Corp. (Nasdaq:SXCI), Hot Topic, Inc. (Nasdaq:HOTT) and American Bancorp of New Jersey Inc. (Nasdaq:ABNJ).

Optimer Pharmaceuticals Inc (Nasdaq:OPTR), Ocwen Financial Corp (Nasdaq:OCN) and Force Protection Inc (Nasdaq:FRPT) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: CH Energy Group Inc (Nasdaq:CHG), Benjamin Franklin Bancorp Inc (Nasdaq:BFBC), Rochester Medical Corp (Nasdaq:ROCM), SXC Health Solutions Corp (Nasdaq:SXCI), Grand Canyon Education Inc (Nasdaq:LOPE) and Shenandoah Telecommunications Co (Nasdaq:SHEN).

Global-Tech Appliances Inc (Nasdaq:GAI), American Italian Pasta Co (Nasdaq:AIPC) and SXC Health Solutions Corp (Nasdaq:SXCI) are among the new 52-week highs in Thursday's trading among companies with market capitalizations under $1 billion.

The way SXC Health Solutions (Nasdaq:SXCI) sees it, even through current market malaise, the company is standing firm with its two corporate feet firmly planted in two complementary arenas: it's providing pharmacy benefits management services and developing the technology engine needed to keep costs under control.

Bringing down health-care costs remains a hot-button issue, as the baby boomers reach retirement age, Medicaid and Medicare grow, and drug costs continue to rise.

Pharmacy benefits management is one course of action to rein in costs, and one of growing importance: witness the CVS (NYSE:CVS) acquisition of PBM giant CaremarkRx in a $21 billion deal last year.

SXC Health Solutions, formerly known as Systems Xcellence, is a niche player in the benefits marketplace, with a market cap of $364 million. Headquartered outside Chicago, SXC Healthís stock has traded on Nasdaq since a 2006 public offering, and with Canadian operations, it's also listed on the Toronto Stock Exchange.

Niche players can be big players in this $4.5 billion market: SXC says one in four 1-in-4 U.S. managed-pharmacy benefit transactions last year touched its technology. Clients include unions, universities and businesses, along with federal, local, state or provincial governments. SXC says recurring contracts account for more than 80% of revenue. In 2007, transactions increased 30% to 404 million.

SXC Health's share price has risen 11.6% in the past three months. Analysts generally have a favorable opinion about the performance going forward: of the 16 analysts polled by Thomson Reuters, three rate it a "strong buy," six call it a "buy," . . .

The following small-cap companies (market capitalizations or values under $750 million) are broadcasting events on Thursday, March 20.

Here are the companies ordered chronologically (all times ET):

The Russell 2000 (NYSE: IWM) is down on fears that the U.S. economy is slowing down despite news of a jump in third-quarter GDP. At 2:13 p.m. ET, the small-cap index had lost 5.38 points, or 0.70%, to 764.66. The Dow Jones Industrial Average (INDU) had added 6.34 points, or 0.05%, to 13,295.79.

The U.S. economy grew at an impressive 4.9% annual rate during the third quarter of 2007, the Commerce Department reported before the opening. That’s an upward revision from the preliminary figure of 3.9% and above economists’ projections of 4.8%.

Although that’s the highest quarterly growth rate in four years, investors are worried that slower growth lies ahead.

That’s in part because jobless claims for the week ended Nov. 24 rose 23,000 to 352,000, the highest number since February, according to the U.S. Labor Department before the start of trading. The revised figure for a week earlier is 329,000.

Also feeding the bears’ appetite is news that sales of new one-family houses in October came in below economists’ forecasts.

The U.S. Census Bureau reported that new home sales increased 1.7% to 728,000, but the total from September was revised down sharply to 716,000 from 770,000 previously. Economists were calling for sales of 750,000.

The numbers tell us that the slump in the housing sector is continuing and showing no signs of letting up.

SXC Health Solutions Corp. (Nasdaq: SXCI), a provider of health-care information technology solutions, announced before the opening that it has cut 7% of its workforce in order to generate about $3 million in annual savings and is reducing its 2007 revenue guidance.

The staff reductions were focused on the provider and administrative segments of the business and mostly took place at the company’s headquarters in Leslie, Ill.

“Having completed a thorough review of the business, we believe this is the right time to reduce costs in certain areas of our operations in order to focus our resources on our [pharmacy benefits management] services and transaction processing business segments, the most rapidly growing segments,” said chairman and CEO Gordon Glenn in a statement.

SXC, which has a total of six locations in the United States and Canada, will incur one-time severance costs of approximately $0.8 million, which will be reflected in its third quarter fiscal 2007 financial results. The company said that it expects to hire new personnel during the fourth fiscal quarter of 2007 and into 2008 to support the areas of the business with the most promising growth opportunities.

Looking ahead, the SXC said that continued delays in the signing of new contracts and a slowdown in retail pharmacy sales have forced it to reduce its 2007 revenue guidance to between $92 million and $93 million, compared with a previous guidance calling for revenue in the range between $95 million to $97 million.

Abatix Corp. (Nasdaq: ABIX), eFuture Information Technology Inc. (Nasdaq: EFUT) and Artes Medical, Inc. (Nasdaq: ARTE) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $500 million.

Here are today's biggest percentage gainers:

Systems Xcellence Inc. (Nasdaq: SXCI, TSX: SXC), an information technology solutions provider to participants in the pharmaceutical supply chain in the United States and Canada, on May 3 announced the results of its operations for the first quarter 2007 ended March 31.

Total revenue for the quarter was $24.3 million, an increase of 26% from $19.3 million in the first quarter of 2006. Recurring revenue totaled $17.9 million, up 44% from $12.4 million for the same period last year. Non-recurring revenue totaled $6.4 million versus $6.9 million in the same period last year.

Net income was $3.7 million, or $0.17 per fully diluted share, compared with net income of $5.6 million, or $0.31 per fully diluted share, for the same period last year.  The press release noted, "Net income in Q1 2006 included a non-cash $2.5 million future tax recovery that was recognized based on the Company's ability to utilize a taxable benefit attributable to historical net operating losses and tax-related timing."

Chairman and CEO Gordon S. Glenn commented, "Strong organic growth in Q1 was driven by increased activity in our higher margin transaction processing business. In January, we 'went live' on substantial contracts with the Georgia Department of Community Health and Kroger Corporation who are now our largest customers in the State Medicaid and employer group markets, respectively. These new customer relationships reflect the maturity and growing acceptance of our business model in the pharmacy benefits marketplace as well as our ability to scale our operations to meet the processing demand from such marquee organizations. With the on-going investment in our products, personnel and capacity, we are well positioned to increase market share in our core healthcare payer markets while further capitalizing on new State Medicaid, employer group and long-term care opportunities."

The United States loves its drugs. And we’re just talking the legal kind here.

From $2.2 billion in 1996, the amount spent on prescription drugs soared to $3.7 billion in 2006.

What’s behind the rise? An ageing population, increased drug usage, higher prices, and the direct-to-consumer marketing of lifestyle drugs have all played a part. Then there’s the U.S. federal program to subsidize the cost of prescription drugs for Medicare beneficiaries that went into effect in 2006 (Medicare Part D).

It’s all good news for Systems Xcellence Inc. (Nasdaq: SXCI), which seems to have written itself a prescription for profitability by helping companies in the prescription drug supply chain process transactions and administer drug benefit programs.

While the company was founded in Canada and is headquartered in Milton, Ontario, just outside Toronto, 95% of its revenues come from the United States.

Systems Xcellence – with 400 employees – has two distinct types of customers to which it sells two different solutions.