7/18 Portfolio Updates – Stopped Out of ZGNX For 3.69% Loss; Added FRED

Recent Portfolio Updates and Thoughts:

Link to Last Week’s Watch List
Link to All Watch Lists

ZGNX (Zogenix Inc.): My cost basis was in the $14.50’s and shares hit $15.18 on 7/12, making me think the move toward $16.00 I’ve been anticipating was indeed going to happen. It turned out to be a head-fake as shares ultimately closed lower the following four trading days. Although I was close to taking profits on 7/12, I wanted a little bit more out of it (which ended up being a mistake). I set a stop loss on the position at $14.00 and it ended up triggering on 7/17. I’ll take the manageable loss and move on to other opportunities.

LQMT (Liquidmetal Technologies Inc.): I added to my position on 7/12 and now own 1,707 shares at an average price of $.28. I was hoping to add in the $.25-.26 range, but I think I missed my best opportunity for that back in June. It’s good to see the ticker basing above $.27 and like the chances of either 1) Apple iPhone rumors causing a spike in shares, or 2) The CEO driving a contract with a big-name technology company (he has a track record of doing so with another one of his companies in the past).

ROX (Castle Brands Inc.): I sold 250 shares at $1.90 on 7/12 in order to book more profits on this ticker. I then added back 100 of those shares at $1.80 on 7/17. I missed a couple great dip-buying opportunities in the $1.70’s within the past week, but I’m still comfortable with my current entry price. I currently hold 1,350 shares at an average price of $1.80. I still like both the technical setup with this stock basing in the $1.70-1.80 range and the fundamentals that lead me to believe it has massive growth potential.

FRED (Fred’s Inc): I added a new position to my portfolio – 50 shares at $6.50. Fred’s is a retailer/pharmacy that recently lost about 50% of it’s value dropping from about $12.00 to $6.00 due to a terminated deal with Walgreens & Rite Aid (in which Fred’s was set to acquire 1,200 Rite Aid stores) and poor Q1 financial results. One of the things I like about this stock, however, is that institutional ownership is over 93%. Short float is also over 44%, which could cause a Short Squeeze. The risk/reward ratio is solid on a turnaround to the $8.00+ level assuming support holds. This is an oversold play that’s starting to base and curl in the $6.50 range.

WTW (Weight Watchers International Inc.): No position in this one for me, but man, this uptrend is undeniable. This is the sort of pattern I wish I had entered 2-3 months ago and just let the position ride (taking some modest profits along the way) until the trend line was broken with emphasis. Having a full portfolio of these types of “runners” would be a dream. This one has been steadily grinding higher since the $14.00 level and is now trading above $37.00 – that’s a gain in excess of 150% in just a few months.  It’s even up over 8% since Last Week’s Watch List.

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