Tag - HUSA

Carlos Slim probably knows more about investing in emerging markets than anyone else alive.

Forbes Magazine named Mr. Slim the world’s richest man last year. His holdings are currently estimated at $70 billion. His telecommunications investments in Latin American countries have been his best earners to date, but the multibillionaire is not stopping there. When he speaks about investment opportunities in new markets, you should listen.

Late last week, Carlos Slim announced his interest in one Latin-American country that many investors overlook.

Houston American Energy Corp (Nasdaq:HUSA), Exceed Company Ltd (Nasdaq:EDS), (Nasdaq:) and Carver Bancorp Inc (Nasdaq:CARV) are among the biggest percentage losers in Wednesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Primeenergy Corp (Nasdaq:PNRG), HMN Financial Inc (Nasdaq:HMNF), Parkvale Financial Corp (Nasdaq:PVSA), Comm Bancorp Inc (Nasdaq:CCBP), and Allied Defense Group Inc (Nasdaq:ADG).

Nobody wants to admit that oil's current supply and demand relationship is temporary. Nobody wants to acknowledge that the world faces some tough decisions in the months and years to come regarding energy supplies.  

The era of cheap oil is over. Sure, we could maybe see oil in the $60's again. But it's pure folly to expect that oil prices might remain there for any length of time.  

Last week we saw huge spikes in energy stocks. Remember Houston American Energy (NASDAQ: HUSA)? We've been watching this small cap oil stock with access to Colombia's vast oil reserves for well over a month now. And since February 1, the stock is up 120%! That is a massive move, and goes to show that energy stocks still have huge upside potential. 

Right now, global oil production capacity—not actual production—is around 94 million barrels a day. As you can see from this chart, actual production is currently between 84 and 85 million barrels a day. Even when demand was peaking in 2007 and 2008, supply only reached 87 million barrels a day.  

Every now and then you've got to eat crow. Yes, it's unpleasant, and I hate getting those feathers and tiny bones stuck in my teeth (sorry PETA members). But I have to admit, I'd rather be wrong by telling you to wait for a small-cap stock to pull back before buying shares, than advise you to jump on a high-flyer only to watch its wings get clipped and plummet back to the earth. So I'm eating crow for breakfast this morning, but it's not all that bad.

In last Monday's issue of Small Cap Investor Daily, The Rise and Fall of Oil Prices, we took a close look at Houston American Energy Group (NASDAQ: HUSA), an independent oil and gas exploration company with big exposure to Colombia's massive oil fields. After reviewing the company, which was trading at $7.67 a share and at 51-times forward earnings, I wrote:

"The bottom line for Houston American is this: I'm not a buyer of shares here, but I'm definitely watching the company. The stock has run 300% since July 1 2009, a nice return. But given that the market has been volatile lately, it's not the best time to jump in on high-flying stocks, and Houston American is definitely flying high right now. But behind the expensive stock is a company with potentially great prospects in a country that is rapidly growing its oil and gas industry."

Now I'm eating crow because yesterday Houston American's stock rose yet another 17% to close at $10.01. That's 30.5% higher then when I said to sit pat just over a week ago. This stock is on a tear, although the reason behind yesterday's ramp higher was indirectly related to Houston Americans current operation.

We're visiting Colombia this Monday to look under the hood of Houston American Energy Group (Nasdaq: HUSA), a stock that has run 300% since Small Cap Investor Daily reader Bill H. began watching it in July. This $220 market-cap company owns a stake in several Colombian oil concessions and is one of a small number of U.S. listed small-cap stocks with exposure to the emerging economy. In last Friday's issue of Small Cap Investor Daily, I gave you a brief overview of Colombia, and outlined some of the reasons we're watching the country for potential small-cap profit opportunities.  

Colombia's economy had been taking off in the 21^st century, but like many countries, its economy faltered in 2008 and 2009. Despite the challenging times, the transformation to a more safe, and open, economy is still intact and foreign capital continues to find a home in Colombia. The country is rich in natural resources and agricultural goods, including coal, gold, sugar, fruits, and coffee. But our interests today lie in Colombia's vast oil resources that make Houston American an interesting company for small-cap investors.         

If the 18^th century Scottish economist Adam Smith were around today, I have no doubt he would have much to say regarding the state of the world economy. The degree to which governments worldwide are influencing markets has surpassed what even modern economists thought was wise just three years ago. Setting CEO pay, influencing hiring and firing of corporate leaders, and issuing debt to fund government investment in public companies is just the tip of the iceberg. I suspect editors of Merriam-Webster's Dictionary will be struggling to define 'free market' in the next revision.

Many governments, ours included, are trying to design a way out of the latest recession. They are crafting complex policies and interjecting in the markets to 'correct' problems that have plagued our economy for years: too much spending, too much leverage, and not enough savings.

But these are challenges that many countries have as well. Witness the debt issues in Greece, Portugal and Spain that are driving stocks down today, just days after the Obama Administration released a budget projecting a $1.6 trillion deficit for 2010. That figure will come to 10.6% of GDP, the worst in modern time. So the question must be asked: have government policies become the Invisible Hand that now guides society?

The theory behind the Invisible Hand that Adam Smith spoke of (and the one I prefer) is that if consumers and merchants buy and sell whatever they want and at whatever price they can get, then markets will efficiently divide resources and everyone will benefit. Smith felt government intervention just messed things up. Basically, by acting through their own self-interest, people allocate capital to those areas with the greatest returns.

So what does this have to do with small cap investing you ask? Everything.

Thankfully, we still have some semblance of a free market when it comes to investing in stocks. So investors can freely invest in both U.S. and foreign stocks. And while there are many profit opportunities in U.S. based small-cap stocks, I see tremendous potential in emerging market stocks for 2010.

Spectranetics Corp. (Nasdaq:SPNC), Volt Information Sciences Inc. (Nasdaq:VOL) and Blyth Inc. (Nasdaq:BTH) are among the biggest percentage losers in Thursday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Opnext Inc. (Nasdaq:OPXT), Hovnanian Enterprises Inc. (Nasdaq:HOV), Houston American Energy Corp. (Nasdaq:HUSA), Acme Packet Inc. (Nasdaq:APKT), Northern Oil and Gas Inc. (Nasdaq:NOG) and Diamond Management & Technology Consultants Inc. (Nasdaq:DTPI).

Here are the biggest percentage losers among small caps:

Small-cap stocks pushed higher in morning action, underpinned by a stronger-than-expected GDP report, which continued a string of recent bullish data surprises. However, gains were limited by a soft tone in the U.S. dollar and by climbing crude oil prices. At 9:52 a.m. ET, the Russell 2000 (NYSE:IWM) was up 1.74, or 0.24%, at 734.69.

The headline figure on GDP was at 3.3%, quite a bit better than the projection for a rise 2.7%, boosted by a 13.2% rise in export activity and by a bump in consumer spending from the release of tax stimulus checks. The latter is a temporary lift and it should be noted that this GDP report is for the second quarter, and we’re nearly two-thirds of the way through the third quarter now. Economic activity has slowed again … if the market wants to rally in the shadow of this GDP report, then there are probably other stories driving the push. The most likely story is that hedge funds are booking profits on shorts for month-end purposes, and that short-covering push is taking place at a time when volume is very thin ahead of the last summer holiday weekend in the United States.

In addition to the GDP report, weekly unemployment claims out this morning, and hit the forecast on the noggin at 425,000. While the headline number was in line with expectations, the continuing claims figure was at 3.42 million, which marks the highest point since November 2003. The number might not have been a surprise, but it also wasn’t anything for the bulls to get excited about either.

It is worth noting that economic data has been the story of late, starting with an upside surprise on consumer confidence Tuesday, continuing with durable goods orders Wednesday and then hitting another high note on GDP numbers this morning.

The morning focus on economic releases did manage to shuffle crude oil to the background, if only for a moment. That said, crude oil prices remain in rally mode, churning toward $120 dollars a barrel into the stock market open. Crude prices continue to climb as traders fret about the need for a risk premium as Tropical Storm Gustav is on a path that could threaten energy production in the Gulf of Mexico. As Gustav treks into the Gulf, it is expected to regain hurricane status; . . .

Houston American Energy Corporation (Nasdaq:HUSA) hit a record high for the second day in a row and for the third time this month on Friday. As the price of crude oil edged higher, shares of the Houston-based oil and gas company’s stock moved up more than 5% to $11.33 on Friday. The company set a previous high on Thursday at $10.50 and reached a top of $8.55 on June 13.

About two hours before the close on Friday, Houston American Energy was at $10.86, up $0.54 from Thursday’s close.

Houston American Energy Corporation (Nasdaq:HUSA) hit a new high at $10.50 on Thursday on no fresh news and with volume nearly tripling the average. The Houston-based oil and gas company announced on Tuesday it had completed the sale of its Caracara prospect in Colombia, which closed at $920 million. Shares of Houston American Energy were up about 13% to $10.42 just an hour before the close on Thursday.

Chemgenex Pharma Ltd (Nasdaq:CXSP), Digimarc Corp (Nasdaq:DMRC) and Pyramid Oil Co (Nasdaq:PDO) are among the new 52-week highs in Monday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Westside Energy Corp (Nasdaq:WHT), Houston American Energy Corp (Nasdaq:HUSA), United States Lime & Minerals Inc (Nasdaq:USLM), Almost Family Inc (Nasdaq:AFAM), Stoneleigh Partners Acquisition Co (Nasdaq:SOC) and National Presto Industries Inc (Nasdaq:NPK).

Here are the new 52-week highs among small caps:

Sequenom Inc (Nasdaq:SQNM), Intersections Inc (Nasdaq:INTX) and Superior Well Services Inc (Nasdaq:SWSI) are among the new 52-week highs in Friday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Houston American Energy Corp (Nasdaq:HUSA), Innophos Holdings Inc (Nasdaq:IPHS), Balchem Corp (Nasdaq:BCPC), Digimarc Corp (Nasdaq:DMRC), Tailwind Financial Inc (Nasdaq:TNF) and NCI Inc (Nasdaq:NCIT).

Here are the new 52-week highs among small caps:

Houston American Energy Corp (Nasdaq:HUSA), Digital Ally Inc (Nasdaq:DGLY) and Fuel Systems Solutions Inc (Nasdaq:FSYS) are among the new 52-week highs in Wednesday's trading among companies with market capitalizations under $750 million.

Northwest Pipe Co (Nasdaq:NWPX), VanceInfo Technologies Inc (Nasdaq:VIT) and NCI Inc (Nasdaq:NCIT) are also among the new 52-week highs.

Here are the new 52-week highs among small caps:

Crystal River Capital Inc (Nasdaq:CRZ), Western Refining Inc (Nasdaq:WNR) and Corus Bankshares Inc (Nasdaq:CORS) are among the new 52-week lows in Wednesday's trading among companies with market capitalizations under $750 million.

US Shipping Partners LP (Nasdaq:USS), LCA Vision Inc (Nasdaq:LCAV) and Adams Golf Inc (Nasdaq:ADGF) are also among the new 52-week lows.

Here are the new 52-week lows among small caps:

Mercury Computer Systems Inc. (Nasdaq:MRCY), Houston American Energy Corp. (Nasdaq:HUSA) and Origin Agritech Ltd. (Nasdaq:SEED) are among the biggest percentage gainers in Monday's trading among companies with market capitalizations under $750 million.

Community Bank Shares of Indiana, Inc. (Nasdaq:CBIN), STEC, Inc. (Nasdaq:STEC) and New Oriental Energy & Chemical Corp. (Nasdaq:NOEC) are also among the top small-cap percentage gainers.

Here are Monday's biggest percentage gainers among small caps:

Here are Monday’s biggest percentage gainers and losers in midday trading, along with top volume leaders, among companies with a market cap between $50 million and $750 million:

Biggest percentage gainers:

• Mercury Computer Systems Inc. (Nasdaq:MRCY), up 22.8% to $8.89 after the Chelmsford, Mass.-based maker of high-performance computers and software reported third-quarter net income of $1 million, or $0.04 per share. Wall Street analysts expected a loss of $0.01 per share.
• Houston American Energy Corp. (Nasdaq:HUSA), up 15.9% to $5.64 after the oil and gas exploration and production company despite no significant news from the Houston-based firm.
• Origin Agritech Ltd. (Nasdaq:SEED), up 15.7% to $7.50 despite no significant news from the China-based supplier of crop seeds. Investors on Internet message boards speculate a world food shortage might be pushing the price up.

Biggest percentage losers:

• Radware Ltd. (Nasdaq:RDWR), down 14% to $9.15, after reporting a wider-than-expected first-quarter loss and lower revenues.
• Image Sensing Systems, Inc. (Nasdaq:ISNS), down 11% to $12.45 despite no significant news from the Saint Paul, Minn.-based maker of video processing products.
• Monarch Financial Holding, Inc. (Nasdaq:MNRK), down 10.6% to $10.05 despite no significant news from the Chesapeake, Va.-based bank holding company.