Tuesday, May 20, 2008

Dead Cat Bounce Stocks

A 'Dead Cat Bounce' takes place when a stock has a slight rise after a sharp drop. To utilize this type of investment opportunity, you would want to find a stock with favorable financials (although although great financials are not absolutely necessary) that has had a significant drop, with the anticipation that the stock should have a slight rise after the drop.

The following stocks all have market caps over $250 million, P/E ratios below 20, and PEG ratios below 1.7, plus they have all just traded at 52 week lows. Three of the stocks pay dividends. You may not consider these true dead cat bounces, because for some, the drop was gradual, not sharp.

Citizens Republic Bancorp, Inc. (CRBC) is a bank holding company which operates in Michigan, Wisconsin, Ohio, Iowa, and Indiana The stock has a PE of 6.1 and a PEG of 0.87 .

Callaway Golf Company (ELY) is a manufacturer and marketer of golf clubs and golf balls. The stock has a PE of 15.1 and a PEG of 1.40 The company pays a yield of 2%.

Cathay General Bancorp (CATY) is the holding company for Cathay Bank, which operates primarily in California. The stock has a PE of 6.4 and a PEG of 0.67 The company pays a yield of 2.6%.

Dollar Financial Corp. (DLLR) provides financial services such as check cashing, consumer loans, money orders, and electronic tax filing. The stock has a PE of 9.6 and a PEG of 0.59 .

Capitol Bancorp Ltd. (CBC) is a Lansing, Michigan based bank holding company. The stock has a PE of 15.2 and a PEG of 1.69 The company pays a yield of 3.7%.

Iconix Brand Group, Inc. (ICON) markets various consumer brands including Bongo, Badgley Mischka, Joe Boxer, Rampage, Mudd, London Fog, Mossimo, Danskin, Rocawear, Cannon, and Royal Velvet. The stock has a PE of 12.7 and a PEG of 0.55 .

Quanex Building Products Corporation (NX) is a manufacturer and marketer of building products materials and components. The stock has a PE of 18.1 and a PEG of 1.36 .

Author has owned ELY for many years.

By Fred Fuld at Stockerblog.com

1 comment:

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