I did not manage to find any potential superstock during this week's scan. There are a couple of names that almost made it to the this a...

Weekly Superstock Scan 23 May 2016 - 27 May 2016: Nil

I did not manage to find any potential superstock during this week's scan. There are a couple of names that almost made it to the this and are worth a mention in this post.

LifeVantage Corp (LFVN)

LFVN is engaged in the identification, research, development and distribution of nutraceutical dietary supplements and skin care products. It broke out from a flat base with strong volume. In the past two quarters, LFVN reported y-o-y EPS growth. In particular, it reported a 100% increase in EPS y-o-y.

The only thing stopping me from considering the stock is its valuation. On a trailing 12 months basis, LFVN is trading at 32.6 times earnings. Based on the annualised earnings for the most recent quarter, the stock is trading at 22.1 times earnings. While some stocks with high valuation are some of the best performing stocks, LFVN's growth rate is not consistent nor high enough to support the current valuation. I fear that the risk-reward ratio will not give me a positive edge for this stock.  

Grana y Montero SAA (GRAM)

GraƱa y Montero is a group of 26 engineering and infrastructure service companies operating in 7 countries in Latin America, with permanent operations in Peru, Chile and Colombia and more than 29,000 collaborators. The sheer number of companies and an unfamiliar region makes it hard to analyse the company.

Chart-wise it is beautiful, breaking out from a downward sloping base. The 10wMA magic line is clearly defined making it easy to manage the trade. Fundamentally, similar to LFVN, the last two quarters see increased earnings y-o-y, and the most recent quarter saw a 220% increase in EPS y-o-y.

The reason why I did not see GRAM as a superstock was the high growth rate may not be sustainable. Engineering and infrastructure firms are difficult to analyse and the conference call transcripts did not highlight any potential catalysts. With the decreasing backlog, the odds for sustainable growth is further lowered.


Previous Superstocks

EHTH (Posted on 15th May 2016 Watchlist)
Continue to move up, pending pullback

GDEN (Posted on 24th Apr 2016 Watchlist)
A substantial pullback last week, close to 10wMA

EXFO (Posted on 10th Apr 2016 Watchlist)
Entered @ 3.8. Closed light and tight at 10wMA for two weeks, may add to position.

BORN (Posted on 3rd Apr 2016 Watchlist)
Bounced off 30wMA, results out this week.

ELMD (Posted on 3rd Apr 2016 Watchlist)
Entered @ 4.2 and sold @ 4.05. Closed below 10wMA on poor results. Ending coverage for now.

PLPM (Posted on 27th Mar 2016 Watchlist)
Bounced just above 10wMA and missed the trade

SNC (Posted on 6th Mar 2016 Watchlist)
Entered @ 11.95. Closed just above the gap and 30wMA, will add if bounce off from here.

JRJC (Posted on 14th Feb 2016 Watchlist)
Broke through 30wMA and trendline, ending coverage.

EDUC (Posted on 24th Jan 2016 Watchlist)
Entered @ 9.95. Closing tight and light at 30wMA, may add on.

VRA (Posted on 11th Jan 2016 Watchlist)
Entered @ 14.4 and Exited at 17.25. Consolidating at 30wMA.

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