Buy These While They Are Cheap: SNTA, BELM, PSUN

Trends, Charts and Exclusive Opinion

Three SmallCaps to Buy When They are Cheap

SNTA: FDA Gives Thumbs Up to Drug Trail Renewal

BELM: Revenues Up; Operating Expenses Down

PSUN: Teen Retailer Numbers Next Thurs Could Surprise

Up first this morning is Synta Pharmaceuticals Corporation (SNTA) http://www.syntapharma.com/ currently trading in the $4.38 range on a 3-Month average daily trading volume of 327,290 shares. �Looking somewhat like the Brooklyn or Golden Gate bridge, the SNTA chart below shows a $2 floor in March 09, then a jump in May to $5 followed by a quick fall to under $3. The stock essentially stayed and established a $3 for the next 5-Months. SNTA then shot up again in Nov, this time to the $7 range; where in the next 10-weeks it fell back to its current level.

SNTA has a 52-week high of $6.95 set on 12-18-09. SNTA has trailing twelve month revenues of $140+ million. The reason SYNTA is a short-term (6 Mo) �Buy� consideration for me is this: a trailing twelve month positive, diluted EPS of $1.77. And the bonus: hardly any short-sellers. I also like the fact that SNTA has a healthy pipeline of drug candidates in various Phases of trials.

On Tuesday, SNTA management announced the Company will restart development of its skin cancer drug candidate elesclomol. SNTA expects to start at least one new clinical trial in the second half of 2010. Management said it reached its decision after consulting with the FDA. Research on elesclomol in skin cancer was stopped in February 09.

SNTA 1-Year

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Gaining a whopping 15%+ yesterday is Bell Microproducts Inc., (BELM) http://www.bellmicro.com/ currently trading in the $5.13 range on a 3-Month average daily trading volume of 147,459 shares. BELM is widely owned by insiders (38%+ of the public float- they are vested in good performance) BELM was trading under a $1 in April and May of 09, setting a $1 floor in the next 2-Months. The stock then staged a steady, 3-Month climb into the $3.50 range and it stayed at that level for 3-Months. In Jan, BELM shot up to $5 and has stayed in the $4.50 range for the last 6-weeks. BELM has a 52-week high of $5.20 set on 01-10-10. BELM has trailing twelve month revenues of $2.95 billion.� �

BELM rose yesterday on Q4 revenues rose and operating expenses fell. BELM earned $12.9 million, or 40 cents per share, in Q4 09. That compared with a loss of $33.5 million, or $1.04 per share, in Q4 08. What an improvement. Q4 09 sales rose 9% to $837 million, with sales of components and peripherals climbing 27% percent year over year. The company said that sales in Europe! climbed 14%. Guidance... for Q1 2010, the Company expects sales of $780 million to $815 million, which would be a jump of 9% to 14% when compared with Q1 09. Even near its high, BELM is undervalued and is a short-term �Buy� consideration for me. It will not stay in the $5 range for long.

One more note that influences my consideration; in early Feb, the SEC said that the investigation concerning the company's accounting and financial reporting matters has been completed and that no enforcement action has been recommended. BELM is clean.

And finally, a billion dollar revenue company for $5. That�s Pacific Sunwear of California Inc., (PSUN) http://www.pacsun.com/ currently trading in the $5 range on a 3-Month average daily trading volume of 885,600 shares. PSUN was trading under $2 in April of 09, then shot to $4 at the end of May (a pre-peak of its cyclical season). The stock flattened out; between $3-$4 for much of the summer and then in the fall, shot up to $7. PSUN staged a slow and steady fall back to the $3 range and in the last 10-weeks; it has staged a comeback.

PSUN has a 52-week high of $7.25 set on 10-23-09. I�ve suggested PSUN as a �Buy� consideration before and at this price, I stand by that (and for the record; I have never owned and don�t now own PSUN). This is a good cyclical company that reads the teen retail market like a book. Next Thursday, PSUN will announce its Q4 09 earnings after the market closes. Lots of shareholder anticipation out there. Buy low; sell high. As of Jan 31, 09, PSUN l! eased an d operated 932 stores in the United States and Puerto Rico.

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