Last week’s picks*:

VA: SSW -1.25%
MR: ITT +2.59%
ST: APT -25.3%
SS: LMNX +6.17%
SS: INTC +1.66%
FX: EURUSD +75 pips

There was more volatility in markets last week but stocks managed to finish on a positive note with the Dow Jones Industrial Average finishing Friday’s session higher by 1.63%.

Market indices began the week gripped by fear over Ebola and Fed tightening but they finished the week in buoyant mood as corporate earnings and dovish comments from Fed official James Bullard boosted stocks.

Our stock picks had a volatile week and we saw a big loss from our risky StockTwits trade in $APT. SSW was down 9% at one point but managed to pare losses while the most popular pick of the week (short INTC) made us 1.66%.

Here’s this week’s picks: (vote at the end)

Value

Integrated Silicon Solution Inc. $ISSI

Integrated Silicon Solution Inc. designs, develops, and markets integrated circuits in four key markets; automotive, communications, digital consumer and industrial/medical/military. ISSI’s main products are high speed and low power SRAM and low and medium density DRAM.

The company has been in a strong upward trend since 2009 but the recent market volatility has seen the stock drop 25%. This has put the shares into the oversold territory and made them look cheap on a value basis. PE is 14.70 and PEG is 0.84. Current ratio is 4.30, ROE is 8.60% and the company pays a dividend of 2.02%.

ISSI stock chart

Mean reversion

PDF Solutions Inc. $PDFS

PDF Solutions Inc. is the leading provider for technologies and services in the IC (integrated circuits) manufacturing cycle. PDF Solutions’ Charterization Vehicles test ships are used by more leading manufacturers than any other test chips in the industry.

PDFS is extremely oversold right now having lost -53% year-to-date and the stock now has a daily RSI reading of 17.85. The stock could see a bounce to help it close the gap up to $17. Stops can be kept tight below 11.70.

PDFS chart This week's picks

StockTwits

Newlink Genetics Corp. $NLNK

Leading the chat on StockTwits over the last seven days has been Newlink Genetics Corp, a biotech company established in 1999. Newlink specialises in immunotherapy and cancer treatment but the company has been in the news recently over a potential Ebola vaccine trial.

NLNK is the most trending stock on StockTwits over the last seven days and 97% of StockTwits users are bullish on the shares.

Newlink Genetics Corporation stock chart

Short Sellers

Craft Brew Alliance Inc. $BREW

Craft Brew Alliance was formed from the merger of Widmer Brothers Brewing and Redhook Ale Brewery in 2008. The alliance was then joined by Kona Brewing in 2010.

Craft Brew aim to create handcrafted, unique beers, however the stock price has had a rapid rise over recent weeks. In fact, the stock is up 50% over the last three months alone and this has pushed the shares into overbought and overvalued territory.

Price to earnings is now 72.70 and the PEG ratio is 3.63. The chart also looks toppy with plenty of resistance around the $17 level.

Craft Brew Alliance Inc stock chart

Forex

EURUSD

I’m sticking with my EURUSD call from last week. The euro has failed to drop, despite a number of bearish announcements and even as traders flock to the US dollar in face of equity market volatility.

EURUSD picks chart

As always, let me know what your favourite pick is by completing the quick poll below. And if you have any other picks you want to share, you can put them in the comments…

[poll id=”8″]

*Hypothetical results. Commissions and slippage not applied.

Disclaimer: Please be aware of the usual risks to trading in financial instruments. Please remember the importance of doing your own research and understand the cost to trade including trading commissions and the bid:ask spread.

 


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