Small-cap Technology Stocks Outperform, While Large-cap Stocks Stagnate; Special Report by Penny Stock Detectives

In a recent Penny Stock Detectives article, editor Mitchell Clark points out that if earnings numbers beat with conviction.

New York, NY (prHWY.com) August 16, 2012 - In a recent Penny Stock Detectives article, editor Mitchell Clark points out that if earnings numbers beat with conviction, you can trade off earnings news. Clark notes that there's good movement in smaller-cap technology stocks, and while large-cap technology stocks aren't moving that much this earnings season, small-cap technology stocks are and they're outperforming.
Clark uses Rudolph Technologies as a prime example: "Here's a great, event-driven trade that just happened when the broader market was flat," he says. "...The company's second-quarter earnings were a total surprise, as its results beat the Street on strong product demand."
Rudolph Technologies is a company that's been around a while, selling highly technical solutions that help with quality control in the manufacture of semiconductors and data storage equipment, explains Clark.
According to the company, its 2012 second-quarter revenues grew to $56.3 million, representing a 23% increase over revenues of $45.7 million generated in the 2012 first quarter. Generally accepted accounting principles (GAAP) earnings in the second quarter were $6.3 million, or $0.19 per diluted share, compared with earnings of $1.9 million, or $0.06 per diluted share, beating consensus by $0.05 a share, Clark reports.
The stock opened up just under $10.00 a share, and then sold off a bit on some profit taking. Then the position spiked to over $10.75 a share before falling back to $10.00, notes Clark.
"This was one of those technology stocks that you could have day traded, even after the position opened higher on better than expected second-quarter earnings," he says
According to the Penny Stock Detectives editor, as a group, technology stocks are attractive for event-driven trades. But for longer-term investing, growth rates are no longer guaranteed to be double-digit, so investors might be better off with a large-cap, dividend paying brand name, over trying to bet on a company's business cycle in this economy, believes Clark. In his opinion, for event-driven trades, institutional investors will still move big in technology stocks if the news is good enough.
"A major earnings surprise is still a big deal in a lackluster market," Clark says.
For the first time in a number of quarters, this earnings season revealed the slowdown in top- and bottom-line growth, observes Clark. The outlook for technology stocks for the rest of this year is modest at best, he argues, although the NASDAQ has shown a lot of resilience over the last several years. Looking at the stock market today, Clark says it's fairly valued considering the earnings.
To see the full article and to learn more about Penny Stock Detectives, visit www.pennystockdetectives.com.

The editors of Penny Stock Detectives believe low-priced stocks, when researched properly, present investors with great opportunities to accumulate wealth and to increase the value of their investment portfolios. You can learn more about Penny Stock Detectives at www.pennystockdetectives.com.

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Tag Words: technology stocks, earnings

Categories: Business

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