Monday Overview- Envision Solar-EVSI

My biggest (current) small cap position is in EVSI and SCLW.  Socialwise and their Bill My Parents product line we will explore later, since lots is happening with it, but right now this week (or two) will be focused on Envision Solar.
EVSI (Envision Solar)
 I am very pleased with my EVSI position so far up 31% in a short amount of time. I took my first position less than 2 months ago and I am continuing to add.  My last buy was the 21st at .47.
I can hear it now, "Lock in gains...its 31%"...sure this would be important if we were talking a mid or Large cap, however pennies are different...

Typically with a jump on a penny stock, its either its a pump and dump, an outright fraud,  or I believe in this instance, a decent company thats doing everything right and starting to attract attention as a start up. (this is rare and I would say represents less than 1% of penny stocks).

Here's what I like about Envision Solar:

First the big three:
1) Real company with a real product and employees...this actually is a lot more rare than you think in penny land .

2) No outright stock pumping can be found  at this point

3) Solid Management

Followed by...
- Low O/S (outstanding share count)
- Very low float
-  Already had a nice correction and is moving up again (in July)
-  We are finally seeing the 30 daily trade average creep up...this is what you want for steady gains. - It also has decent technicals, but really for a penny stock that doesnt mean a lot. Its more who and what you know :-) If you hear a big player or fund is moving into a stock, that will trump any technicals with a stock that is thinly trading.

I am looking to add to my position under .60, since the buzz and my research is telling me my short term target price is .80-$1.00+.

Side Note:
 Although I am not long, some people might be tempted to stay in after doing their Due Diligence on Envision Solar. 
I didnt see any outright really nasty dilution contracts, but I am not in this for the long haul so its not important to me. If you wanted to stay in a penny, then this is a must. I would read and re read every filing looking for that hedge fund or Angel investor with the nasty convertible dilution contracts...AKA the death spiral.

(Below is a screen shot of my Etrade account EVSI position)

Could we be headed for another Stock Market Crash 2011?

If you follow the Technicals, one thing screams out, and that is that this market is severely OVERBOUGHT. 

Several experts whom I have followed and respect for more than 10 years and called the last crash (and made their follows money during it) are expecting a large correction , soon, very soon. 

  One of my favorites is Dennis Slothower  who runs Stealth Stocks is saying a large correction is imminent and asking his followers to move into cash. 

Dennis is generally spot on

In November 2010, Marketwatch.com had this to say about Dennis:

“(He’s the) advisor who dodged the Crash of 2008…a particularly striking performance.”

And the fiercely independent rating service, Hulbert Financial Digest, has rated Dennis’s service as the second-best – out of 145 services tracked – in terms of risk-adjusted returns.

This is why I am against the typically IRA. If your serious about retirement using the markets, you MUST have your money with a fund that will fiercely protects your gains. It was IRA's that wiped out a lot of retirements in 2008.

If you are trading on your own, I would advise moving forward with caution at this point.  Since the last correction was so recent, I see this time being a lot sharper. That is because all those traders that held in 08 and got burned, are NOT going to let that happen again. 

Now the good news:

There might actually be some great opportunities to short sell some majorly overbought stocks. I'll be looking to pick up some cheap shares of companies such as  GOOG (cheap being $500), which could see a drop of 20% or more if its a sharp enough correction. Other companies like Amazon and Salesforce that I am following will definitely take a bath as well. 

On the flipside look to short the grossly overbought stocks.....

I welcome any opinions :-)

January 2011 Stock Picks

As I set up my incubator fund I want to begin to go over some trades that I have made and continue to make. Typically I look for small caps with big up or in a lot of cases, downside (short selling). For Big companies, I look for undervalued and under the radar picks...

Picks for 2011 

Positions Already held

Socialwise inc- (SCLW) My Average $.54
Current Price: .50
Target: $5-$10
Been in this one awhile but it will see a huge upside. Unfortunately I rode this up to its glory days of $2.88 and planned to sell at $2.50, but held for moral reasons.
Bill my Parents teen debit card is up and running and already has 10K+ users. The holders include a Billionaire, and several celebrity athletes without massively diluting contracts.  Now that the advertising campaign kicks off, Its no longer "If" but when. Definite acquisition target, and Jim Collas isnt selling cheap.  $5 is a fair target based on other company aquisitions.

Envision Solar(EVSI) My Average $.41 (Held since Dec 2010)
Current Price: .53

Target: .80-$1 Short Term     Envision Solar has a solid business plan and product already being touted and is a rare penny stock company doing things right. Robert Noble appears to have his ducks in a row and rumors abound that big contracts are just around the corner. Im looking to double up in a short period, but may hold a little long term.

Long Range Big picks:

Google (GOOG)
Current Price $600
3 year Target:$1500 (may split)


       Loved GOOG out of the gate at $200 when it IPO'd and even loved shorting it at $600 the first time it hit, but things have changed. How computing is done is changing....going are the days when we have PC's. Soon everything will be stored and downloaded from online....companies are saving millions by moving online...called "Cloud Computing"    Google is the top of this list...and if you thing there isnt room to move and you missed the boat, think again! Google is a great buy under $600


Salesforce (CRM)
Current Price $125
3 Year Target $225    
This is another "Cloud Computing" company that is growing by leaps and bounds. Fortune 500 companies are jumping on board and so should you...at least on the stock. The average company increase in sales using Sales Force is 17%.... if you are a company, why wouldnt you use them? Its companies like this that are great to jump on and ride the wave.

Amazon (AMZN)
Current Price: $180
2011 Target: $220
    Yet another "Cloud Computing". Yes this may be a little like the Tech bubble, but right now its early. Even another giant like Amazon has lots of room to grow as they expand their online presence.

A little advice here on ALL my picks. I always lock in gains. Aside from penny stocks, it is vital you lock in your gains. Always keep a "Stop Loss" order in about 10-20% of your buy price, and update it weekly as the stock moves up (never move your stop loss down!).

 
Short Selling :
  Short Selling has long since been frowned upon in the investing community. From the 1800's till now people see it as "Negative".  This is FAR from the reality. With so much fraud out there, Shorts actually balance the tables...without short selling, ENRON and its likes would defrauded the investment community of billions more. If there is something wrong with a company, you short it...just like if something is right, you buy it...

If you are not short selling, you are missing out on a large part of what should be your strategy in the markets.  A great example is BP. When the oil spill hit, as an investor the window was open to speak your mind and short the companies stock. Had you done it right away, you would have doubled up your money quite quickly.
   Typically aside from the BP situations, I short "pumped" penny stocks. They are easy to find and short...

Day Trade Stocks:
China Telephone Group (CHTL)
   Short .44 Covered today .21
     Pump and dump schemes are alive and kicking....and for the short seller, this is great news...here is a classic pump and dump stock....

Evergreen Energy (EEE) Shorted at 2.63 and Covered at 2.33
  This pig may still have wings but they are grabbing some support from somewhere...pumpers and probably covering shorts. I love shorting companies like this that are bleeding cash, have tons of shares hitting the market and bounce from .50 to nearly $3 in one month on pumps. Keep an eye out, might be some room here to jump in again on a Dead cat bounce.

On the watch list to short.. COUGF. This will be a bloodbath...

Making 50%-200% on your money on some picks can be achieved, mix in a few losses and you still end the year up nice.
Hope this helps.