dailybuyselladviserHotter than climate change
Contarians these investors may be, but that doesn’t mean they turn away from popular sectors. Thus they “continue to navigate the fertile fields of the agricultural sector.”
The President’s Portfolio in Contra the Heard contains Hemisphere GPS (TSX-HEM), which has been “hotter than climate change.” Early in January the stock shot up to $1.57. It has since settled down to $1.45. It does not pay a dividend.
As its name suggests, the company supplies Global Navigation Satellite Systems (GNSS). Farm vehicles and machinery are not its only market, however. It also supplies systems to the oil and gas, marine and aerospace industries.
It has lost money steadily, thanks largely to its Research and Development costs, point out the Contra Guys. “Maybe more focused spending is in order,” they reflect.
On the other hand, it pulled in record third-quarter revenue and the balance sheet is “squeaky clean.” As farm revenue keeps going up, so should this stock, the contrarians reckon.
“Insiders appear confident, pumping in money, apparently believing that a turnaround is in store, and perhaps sooner rather than later.”
A takeover is certainly a welcome bonus for any investor, but when you’re piling up double-digit returns, you can always wait ‘til next year.
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