2 Penny Stocks That Aren’t Who You Think They Are
Posted: Friday, September 17, 2010
by John Paul Whitefoot
Penny Stock Insider
Some say imitation is the sincerest form of flattery. Not everyone agrees; especially those being copied. For example, the International House of Pancakes, known as IHOP, has filed a lawsuit against the International House of Prayer, accusing the church of selecting its name knowing it would be abbreviated IHOP. Not content serving up prayer, the church has even expanded and some branches are now serving food. The church has yet to comply with the pancake giant's request.
On Wall Street, ticker symbols are unique identifiers of a specific security. Not surprisingly, a ticker symbol is important as you need it to actually purchase a specific stock. For example, the ticker symbol for Apple is AAPL. For Google, it's GOOG. The ticker symbol for Yahoo! is YHOO.
Not everything is as it seems on Wall Street though. There are a number of excellent penny stocks whose tickers might remind you of other companies. And if you're looking for the juggernauts and stumble on these penny stocks, more power to you.
Forward Industries, Inc. (FORD - NASDAQ) is a penny stock company that manufactures custom carrying cases for hand-held electric devices and the medical market.
In early August, FORD announced that its third quarter revenue increased 23% year over year to $5.1 million. The company reported net income for the period of $17,000 or breakeven per share compared to net (loss) of ($64,000) or $(0.01) per share, in the third quarter of last year. The company ended the quarter with over $19 million in cash and no long-term debt.
Douglas W. Sabra, FORD's President and CEO, noted, "The sales increase in the quarter allowed us to make up for a slow start at the beginning of the fiscal year and bring our year-to-date sales nearly even with last year."
"Our cost containment initiatives have allowed us to maintain a strong balance sheet. The strength of our balance sheet enables our board to review all strategic alternatives to grow our business, including assessing the strength of proposals received from interested shareholders, and we hope to make an announcement in that regard in the near future."
Over the last 12 months, FORD's share price has climbed 231%. Year to date, FORD is currently trading up 74.8%.
Penny stock company The Great Atlantic & Pacific Tea Company, Inc. (GAP – NYSE) operates approximately 430 conventional supermarkets, combination food and drug stores, and discount food stores in 8 states and the District of Columbia under the A & P, Waldbaum's, Pathmark, Pathmark Sav-a-Center, Best Cellars, The Food Emporium, Super Foodmart, Super Fresh, and Food Basics names.
In early January, the penny stock company hit a 52 week high of $13.00. In July, GAP hit a 52 week low of $2.50. Since then, the company's share price has rebounded and recently hit an intra-day high of $3.99 for a two month gain of 59%.
On September 8, GAP announced that it entered into an agreement with Big Y Foods, Inc., to sell seven store locations in northern Connecticut. The sale of these stores is part of a comprehensive turnaround strategy initially announced by GAP in late July. The stores are expected to close at the end of October.
"We continue to evaluate our operating footprint and its alignment with our turnaround strategy. These seven stores were clearly outside of our core markets and their sale was necessary," stated Sam Martin, President and CEO.
Martin continued, "The company faces many difficult decisions over the next several months which are required to strengthen our foundation and improve our performance going forward."
The company's operational and revenue-driven turnaround initiative is designed to generate sustained profitability and cash flow, drive sales growth, restore competitive margins to the business and strengthen the foundation of the company for the long term.
You might not be able to drive FORD or keep warm with GAP, but with a little due diligence, you could profit nicely from these two penny stock companies.
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