Over the last 15 years, the economy has endured a bursting Internet bubble, a crashing housing and stock market - plus a deep-sixed auto industry.
But here are four penny stocks with share values that have risen from their own economic depths to new heights despite some major setbacks. They've done so by never taking their eyes off their core offerings and making them better. Even when the sky was falling all around them and negative nabobs begged for them to cry "Uncle," they carried on and eventually prevailed.
Down the Shute
When the stock market crashed, so did penny stock Sirius XM Holdings Inc. (NASDAQ: SIRI) Since then, the satellite-radio provider has come a long way from the time its share price bottomed at 5 cents in February of 2009.
Solid Fourth-Quarter and 2013 Earnings
Sirius recovery is evident in its fourth-quarter and full-year 2013 earnings reported on Feb. 4, 2014.
The company generated record revenue of $1.0 billion and $3.8 billion in the fourth quarter and full-year, respectively, each up 12%. Net income for the fourth quarter and full-year were $65 million and $377 million, respectively, or $0.01 and $0.06 per diluted common share, respectively.
Income from operations was $245 million and $1.0 billion in the fourth quarter and full-year 2013, respectively. Adjusted EBITDA increased 41% in the fourth quarter to a record $326 million. Full-year 2013 adjusted EBITDA was $1.17 billion, an increase of 27% from $920 million in 2012.
Potential Lawsuits Generated By Acquisition
Despite a myriad of law-firm investigations of Sirius XM for potential stockholder claims as a result of the satellite-radio company's proposed acquisition by Liberty Media Corp., its stock price is holding its own.
On Jan. 3, 2014, Liberty Media make an offer to buy Sirius for about $10.4 billion at a rate of $3.68 per share. The deal involves creating a new class of stock called Series C, adding 0.076 per share to give the company a total market value of as much as $27 billion.
Although the pending acquisition has triggered a slew of potential stockholder lawsuits, without Liberty Media, Sirius XM might not have been here today.
That's because in 2009, Liberty Media kept Sirius XM from going bankrupt with a $530 million loan. As a result, Sirius XM has been able to build a subscriber base 25.6 million strong. It's done so with a line-up of paid-radio choices including classical, rock, alternative, country, sports and live concerts, including the extremely-popular morning man Howard Stern serving as the company's anchor. Moreover, having new cars equipped with XM receivers has also boosted the company’s popularity and acceptability. However, Sirius XM still faces brutal competition from such digital radio competitors as Pandora Media Inc., AOLRadio and Apple Inc.
On Feb. 4, SIRI’s share price closed at $3.52, down 3 cents from its closing price of $ 3.55 the previous day on volume of 64,729,416 shares.
Find out what could be the best investor's move when it comes to SIRI by getting the complete report here, or by cutting and pasting the following link in your Web browser:
Adapting and Raising the Bar
In the early 2000s before the medical community began focusing on obesity as a major epidemic, Owings Mills, Md.-based Medifast, Inc. (NYSE: MED) was a penny stock with a vision but without much share value.
On Dec. 29, 2009 the diet management company was a 14-cent penny stock, compared to its $26.59 share value today. It did so by staying focused and constantly adapting and improving its dietary products.
Launches Mobile Site
Medifast continues to innovate, adapting itself to a younger and more on-the-move demographic.
On Jan 13, Medifast announced that it had launched it first mobile Web site. The company teamed up with technology provider Usablenet to launch the new mobile site that aims to assist health-conscious customers on their weight management journey by providing easy access to products, guidelines, and recipes, anytime, anywhere from mobile devices, according to the release.
The new site features e-commerce-enabled product browsing and a large number of personalized weight-loss plans, which are optimized and easy to read on mobile devices. "Mobile accessibility will help our customers reach their weight loss goals with information readily available on personal devices at all times," Medifast's Vice President of E-Commerce and Digital Marketing Joel Layton, said in a written statement.
Medifast Still Expanding
Medifast has been growing along with its share value. On Jan. 9, the company announced the opening of five new franchise locations in Alabama and Louisiana, which will be owned and operated by Team Wellness CEO, Neal Smith.
"The continued addition of franchised Medifast Weight Control Centers is consistent with our long-term growth strategy and increases the delivery of our services" said Chairman and CEO of Medifast Michael MacDonald, in a written statement. "By growing the footprint of our Weight Control Centers, we stand to reach more Americans, supporting them in their transition to, and maintenance of, healthier lifestyles," he added.
On Feb. 4, MED's share price closed at $ 26.59, down 10 cents from its close of $26.69 the previous day.
Find out what could be the best investor's move when it comes to MED by getting the complete report here, or by cutting and pasting the following link in your Web browser:
Drive-Chain Makers' Comeback
When the auto industry imploded in 2008 it took Axle & Manufacturing Holdings, Inc. (NYSE: AXL) to the dumper with it.
The Detroit-based drive-chain maker's stock value cratered on Mar. 6, 2009, becoming a penny stock selling at 40 cents a share, only to make a major comeback to its current $17.96 a share value today.
Again, instead of reinventing itself, Axle & Manufacturing concentrated on the basics and never stopped thinking about tomorrow as it climbed up its own recovery ladder.
Earns ISO 50001 Certification
Part of the reason for such a comeback is Axle &Manufacturing's high standards. On Jan. 27 the company earned ISO 50001 certification. This is Axle &Manufacturing's first facility to receive this certification.
ISO 50001 is the top international standard certification program for driving continuous improvements in energy efficiency through energy management systems. According to the release, earning the ISO 50001 certification provides proof that Axle &Manufacturing has implemented sustainable energy management systems, completed a baseline of its energy use, and committed to continual improvement in energy performance. Currently, only 34 companies in the United States are certified and only 15 of those are in the automotive industry.
Business Is Booming
In addition, the company continues to grow along with the U.S. auto industry. For example, On Jan. 15, Axle & Manufacturing Holdings announced that its backlog of new and incremental business for 2014 through 2016 of an estimated at $900 million in future annual sales. Not bad for a company that only five years ago was facing bankruptcy.
On Feb 4, ALX's share price closed at $17.96, up 12 cents from its close of $26.69 the previous day.
Find out what could be the best investor's move when it comes to AXL by getting the complete report here, or by cutting and pasting the following link in your Web browser:
Pier 1 Rises from the Ashes
Another real and not mythical Phoenix rising from the ashes is Pier 1 Imports Inc. (NYSE: PIR).
The home-goods pioneer's (NYSE: PIR) volume soared Feb. 4, with 1,929,542 shares changing hands, significantly higher than it three-month average volume of 1,421,666.
The one-time penny stock's uptick in volume could be connected to an anticipated housing recovery.
The recent mortgage meltdown cratered the Fort Worth, Texas-based retailer's stock value that had reached $25 in November 2003. On March 13, 2009, Pier 1 shares hit a low of 11 cents. Despite this, the company never filed for bankruptcy and an improving economy, housing market and a rising stock market have sent its stock surging to its old highs again.
But during the holiday selling season, Pier 1 did poorly. Its CEO Alex W. Smith blamed continued slow traffic caused by wintry weather for the pitiful 1.3% increase in same store sales for the five-week period ended Jan. 4, 2014, compared to the five-week period ended Jan. 5, 2013.
That’s why it's increasingly critical that the 2014 housing recovery becomes the real deal.
So far, there are some good market indicators. Here are just three of them:
- Fannie Mae's positive outlook for the 2014 housing market in a Jan. 13 statement by its Chief Economist Doug Duncan: "Despite the rise in mortgage rates since the spring, many housing indicators posted strong gains at the end of 2013 and consumer housing attitudes are strengthening, all of which bodes well for continued but measured housing recovery in 2014," Duncan said in a written statement.
- New homes are staying on the market for an average of 3.1 months before being sold, far less time than the average 5.5-month average for the last 30 years.
- A recent report by Wash.-D.C. financial publisher Kiplinger is forecasting that new-home sales are likely to soar by a solid 15% or 500,000 in 2014.
E-Commerce Growth Anticipated and Needed
An increasingly stronger online presence could also help turbocharge Pier 1's sluggish sales. The company witnessed the growing importance of its popular Web site Pier1.com when the ecommerce site ended up accounting for about 4% of the company’s total December sales.
The good news is that the outlook for online sales is much better than it was in 2013. In 2014, ecommerce sales will soar to nearly $250 billion, up from $155 billion in 2009, according to Cambridge-Mass research firm Forrester. Last year, online retail sales were up a healthy 11 percent, compared to 2.5 percent for all retail sales.
On Feb. 4, PIR's share price closed at $18.42, down 4 cents from its close of $18.38 the previous day.
Find out what could be the best investor's move when it comes to PIR by getting the complete report here, or by cutting and pasting the following link in your Web browser:
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