Tag - Xrm

Stocks generally continued their upward trajectory and extended the rally today. The Dow closed up 33.63 points today to finish at 9,320.19; the Nasdaq finished up 2.70 points at 2,011.31; and the S&P 500 held over 1,000 to finished 1,005.61, up 2.98 points.

The Russell 2000 index finished up 4.38 point at 570.16.
 

Leading small-cap price gainers include Xerium Technologies (NYSE:XRM), up 33%; Georgia Gulf Corporation (NYSE:GGC) up 45%; Central Pacific Financial (NYSE:CPF) up 32%; and YRC Worldwide (Nasdaq:YRCW) up 30%.

Declining small-caps include WPT Enterprises (Nasdaq:WPTE) down 26%; The Phoenix Company (NYSE:PNX) down 19%; and Mellanox Technologies (Nasdaq:MLNX) down 17%.

*****Oil prices are slightly lower this morning. That should mean stocks will trade lower today as well. And while many are saying the fundamentals of this economic recovery do not support current prices for stocks or oil, I wouldn't get too excited about an imminent trade-worthy decline.

More likely, we will see any dip get bought by the bulls. And I doubt any dip will last for more than two days…

*****Sometimes, the financial markets can be very simpleminded--even downright dumb. And I believe now is one of those times. The federal government has committed to pouring as much cash into the economy as is necessary to keep prices from falling too much. And that may be all we need to know.

After all, banks can make money when they have the ability to borrow at 0.5% interest. They can make more money in fees when the government is sponsoring mortgage loan modifications. And when the government forced banks to raise more capital by selling stock, Goldman Sachs (NYSE:GS) may have made as much as $1 billion in profit from fees associated with secondary offerings.

Car companies and banks can make money from the Cash for Clunkers programs. Auto sales rose 13% in June, helped by this program. Heck, Ford (NYSE:F) posted its first rise in sales since 2007!

*****Some estimate that 40% of the world's wealth was lost in the wake of Lehman's collapse and the financial crisis. The only way to get that money back is to earn it. But companies aren't really earning money the old-fashioned way -- government policies are focused on allowing companies to do just that.

Sure, it's a form of trickle down economics. And while the long-term success may be questionable as there are always unintended consequences, make no mistake about the effect on the short-term. Assets are being reflated. Home values, stock prices, commodities - all can be expected to move higher.

*****Thanks to everyone who has sent in submissions for The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks T-shirt contest. In case you don't know, my first book is coming out on September 14, 2009. As part of the marketing plan for my book, The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks, I'm holding a T-shirt contest. I want you to be the one who comes with the slogan for The Small Cap Investor: Secrets to Winning Big with Small Cap Stocks T-shirt. 

Submissions have already been posted to the Small Cap Investor Facebook page and we're holding this contest open for just a little longer to get your idea. Post your submission on the Small Cap Investor page on Facebook

Small Cap Investor page on Facebook  send it to tshirt@smallcapinvestor.com. We're keeping this open until Sunday, August 9th.

Everyone who submits a T-shirt slogan will get a 30-day, 100% complimentary trial to my SmallCapInvestor PRO advisory service. The winner gets a one-year subscription to ALL of my advisory and trading services ($2,680 value), plus a signed copy of the book and three t-shirts. Voting on the slogan will begin shortly after the 9th.

*****The Managed America video conference is coming up next Monday, August 10 at 6:00 P.M. We'll cover the game plan for making profits in an America with sustained high unemployment, weak growth, weak banks, higher taxes, and excess government regulation. You don't want to miss this. It's free to attend and you can register HERE.

Ian Wyatt

Editor

Daily Profit

P.S. Tomorrow is NewsletterAdvisors.com Wednesday where we interview one of the country's top investment experts. We're fortunate to have Carla Pasternak of High-Yield Investing and High-Yield International, two of the leading publications for dividend and income investments. Don't miss tomorrow's edition of Daily Profit with our in-depth interview with Carla.

Xerium Technologies’ (NYSE:XRM) days as a spendthrift are over. The supplier of products for the paper industry now must save: improve operations, streamline the business and stall capital investment in Asia. If it sticks to its plan, Xerium just may live to tell the tale of life at the brink of bankruptcy.

It’s a scary story, too. Xerium makes two products used in paper production: clothing and roll covers. Clothing products, representing two-thirds of sales, are synthetic textile belts that move paper through a paper-making machine. Roll covers protect the large steel cylinders that flatten the paper and determine paper quality.

The global market for Xerium’s products is about $3 billion, and it has about a 20% share. Roughly 18% of Xerium’s revenues come from the Asia-Pacific, 37% from Europe, 34% from North America and 9% from South America, leaving a tiny amount for the rest of the world.

Lured by the sirens of Asian economic growth, Xerium realized in February that it had overextended itself; in the fourth quarter of 2007, the company built a clothing plant in Vietnam and invested in two roll-cover companies in China. Investors at the time were already concerned about the aggressive growth initiatives given Xerium’s high debt level.

And indeed, Xerium was headed toward a violation of its leverage covenant, or total debt divided by EBITDA, in the first quarter. As the company scrambled to work out credit arrangements — and incorporate its new CEO Stephen Light — it . . .

Crawford (Nasdaq:CRD.B), Transact Technologies Inc. (Nasdaq:TACT) and US Physical Therapy Inc. (Nasdaq:USPH) are among the new 52-week highs in Monday's trading among companies with market capitalizations under $1 billion.  

Also included among the results: K-Tron International Inc. (Nasdaq:KTII), NPS Pharmaceuticals Inc. (Nasdaq:NPSP), Almost Family Inc. (Nasdaq:AFAM), Xerium Technologies Inc. (Nasdaq:XRM), Met-Pro Corp. (Nasdaq:MPR) and Farmers Capital Bank Corp. (Nasdaq:FFKT).    

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

Shares of Xerium Technologies Inc. (NYSE:XRM) got a bit of a pop today after Citigroup upgraded the manufacturer and supplier of consumable products used in the production of paper to a “buy” from “hold.”

Shares gained 10%, or $0.52, to $5.50 in late day trading. For detailed price information and recent news stories about Xerium Technologies, click XRM. 

MTC Technologies Inc. (Nasdaq: MTCT), Titan Machinery, Inc. (Nasdaq: TITN) and Xerium Technologies Inc. (NYSE: XRM) are among the biggest percentage gainers in Monday's trading among companies with market capitalizations under $750 million.

Here are today's biggest percentage gainers:

Small-cap stocks jumped nearly 3% today, propelled by surprise earnings from Wal-Mart and an easing of credit fears. The Russell 2000 (NYSE: IWM) added 22.06 points, or 2.88%, to 789.15, snapping a two-day losing streak. The Dow Jones Industrial Average (INDU) gained 319.54 points, or 2.46%, to 13,307.09, its first rise in four sessions.

On a year-to-date basis, the Russell 2000 has advanced 0.22%, while the Dow has risen 6.67% and the S&P 500 has added 4.55%.

Trading got off to a bullish start this morning on news that Wal-Mart Stores Inc. (NYSE: WMT) saw a 7.9% increase in third-quarter profit at its U.S. stores, while revenue rose 8.9%.

The result pleasantly surprised analysts and eased fears that the U.S. consumer was cutting back on spending. Americans do about 10% of their shopping at the Bentonville, Ark.-based retailer, which began offering discounts two weeks earlier than last year to lure customers.

Stocks were gaining momentum, with the Russell 2000 adding more than 1% within the first 30 minutes of trading.

The bears had no chance, even after Bank of America Corp. (NYSE: BAC) said that it projects a fourth-quarter pre-tax charge of $3 billion due to its purchase of collateralized debt obligations that have plummeted in value because of the stagnating U.S. housing market. Collateralized debt obligations are loans—such as mortgages—that are pooled together and sold to institutional investors as a package.

Xerium Technologies, Inc. (NYSE: XRM) shares are soaring after the maker of paper production products reported third-quarter income of $7.08 million, or $0.16 per share, above analyst estimates of $0.13 per share and up 216% from $2.24 million, or $0.05 per share, a year earlier.

“We continue to make meaningful progress as we work to strengthen our core businesses and position Xerium for future growth,” CEO Thomas Gutierrez said in a statement. “As we have described in previous quarters, the roll covers business continues to face a number of challenges that have limited our ability to generate sales increases.”

The firm’s quarterly net sales rose 6% to $153.6 million, above Wall Street projections of $145 million and compared with $145.5 million during the same period of 2006.

Gutierrez said the company remains “cautious about market conditions as consolidation amongst our customers continues and the competitive environment, particularly in Western Europe, is still challenging.”

In afternoon trading, XRM shares are up 20.11%, or $0.74, at $4.42. Over the last 52 weeks, shares have ranged from $3.29 to $12.07.