USA Technologies $USAT to be Added to @TradeIdeas HOLLY Hot List

May 17, 2018

USA!

USA!

USA!

Ok, with Memorial Day approaching, perhaps I’m feeling a bit patriotic. But here we are with a company called USA Technologies forming a high flag pattern. I mean, c’mon!!!!

This provider of wireless networking and cashless transaction solutions has a modest $635 million market cap, but does a respectable 500,000+ shares of trading volume on average every day.

$USAT has a colorful past for equity traders. It was one of the high fliers during the dot com boom of the late nineties having traded to an astronomical split-adjusted price over $650 per share. Then this was one of numerous stocks that got absolutely murdered in the post market top bear market, culminating in a hilarious 1-for-100 reverse split in 2006. And for most companies, this is where the story usually ends.

But USA Technologies is a fighter (USA! USA! USA!). Unlike many of it’s compatriots in the 90’s, they actually built useful products and it’s taken a long time to wring the excesses out of the stock price, but in the decade since the inglorious reverse split, the company has focused on it’s business, and investors are starting to wake up to the new reality. So far in 2018, $USAT is up 23% and is up more than 600% since the beginning of 2015. And considering the colorful distant past, this 600% 3+ year rise has been surprisingly persistent and lacking in any real volatility.

With the high tight flag forming on a daily chart this month coupled with HOLLY’s detection of an active catalyst present in the marketplace, this feels like the right time to jump aboard for a possibly explosive move.

 

We’ll be adding this name to the portfolio at the open of trading, Friday May 18.

HOLLY HOT List Portfolio Highlights:

The markets have been kind to the portfolio, adding more that 100 basis points of return to the bottom line since our last update last week. These gains have been driven by impressive moves in $GDS $OLLI and $HAE. And of course, $HFC continues to be a monster for us — we’re up 35% in this name since we added it on March 10.

The one notable laggard has been $SAIL — it can’t seem to catch the breeze. Yet.

As of close on May 17, 2018

 

If you’d like to learn how HOLLY, the Artificially Intelligent Virtual Analyst, can improve your trading and investing results, please visit Trade Ideas.

Good luck out there!

~ Sean McLaughlin (@chicagosean)