Vuzix Corporation (VUZI), our February pick at $6.15, closed at $7.55 yesterday for a gain of 23% in just over a month.

News of a development agreement with electronics giant Toshiba for customized smart glasses by Vuzix has resulted in some initial short covering and with a solid rise in volume and share prices. The agreement validates the patented waveguide technology Vuzix has that opens the way for augmented reality glasses that look like something you wouldn’t be embarrassed to wear. I test drove a working pair of the new Blade 3000 series of AR glasses (which will be rolled out the second half of this year) and they looked great, worked great, were surprisingly comfortable, lightweight, and sturdy.

Additionally, Vuzix was featured on the front page of the Wall Street Journal print edition on Sunday in an article titled “Smart Glasses Get a Fresh Look.”

And while the latest numbers show over 25% of the VUZI float short and still to cover, longs and shorts alike shouldn’t be surprised to see more positive news from VUZI on the Toshiba front.

CEO Paul Travers noted that:

“The (Toshiba) agreement demonstrates how we are leveraging and partnering our industry leading technology with top tier global partners.  We trust that this will be the first of many ongoing collaborations between the firms.”


Vuzix conference call Friday, March 17th at 9:00 am Eastern Time.

The call will cover Q4 and full-year 2016 financial results and provide a business update.

Dial-in Number for U.S. & Canadian Callers: 877-709-8150
Dial-in Number for International Callers (Outside of the U.S. & Canada): 201-689-8354

Participating on the call will be Vuzix Chief Executive Officer and President Paul Travers and Chief Financial Officer Grant Russell, who will discuss operational and financial highlights for the quarter and year ended December 31, 2016, and will share a business update.

A replay will be available for 30 days, starting on March 17, 2017, at approximately 10:30 a.m. (ET) by dialing 877-660-6853 within the U.S. or Canada, or 201-612-7415 for international callers. The conference ID# is 13656767.

Stay tuned VUZI longs, as all indications are that 2017 is going to be the breakout year for VUZI in sales, strategic partnerships, and investor awareness.

tapimmune-logoTapImmune (TPIV) to Host Inaugural Quarterly Business Update Conference Call and Webcast

TPIV is a more recent pick from two weeks ago at $4.30, see: TapImmune (TPIV): Developing Cutting-Edge Vaccines that Attack Ovarian and Breast Cancer with a Vengeance).

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TapImmune’s current market cap of just $39 million is a bargain given the company’s cash balance + $13.3 million grant from the U.S. government, + four Phase II studies in progress with top tier partners like AstraZeneca (AZN) and Mayo Clinic.

TapImmune will have its inaugural quarterly business update conference call and live webcast today, Tuesday March 14th, at 4:30 pm Eastern Time.

You can register for the live webcast here:

  • To access the call, dial: (877) 870-4263 (U.S.), or (412) 317-0790 (International).
  • To access the live audio webcast, visit the Events section of the TapImmune website

The webcast will be archived for 90 days beginning at approximately 6:30 p.m. ET, on March 14, 2017.

This should be an exciting call by TapImmune and I’ll be listening intently.

TPIV has 4 different phase 2 studies underway for breast and ovarian cancer with world-class sponsors and collaborative partners, and it’s very reasonable to expect continued share price appreciation as more retail and institutional investors become aware of the company in the coming weeks and months.


TapImmune Pipeline

See also: TapImmune January 2017 Investor Presentation.

Disclosure/Disclaimer/Terms of Use

Green Organic Dutchman - gary

Two of our picks for 2017, Vuzix Corporation (VUZI) and DarioHealth Corp (DRIO), are on the move.

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Vuzix Corporation, (web site), a leading supplier of Smart-Glasses, Augmented Reality (AR) and Virtual Reality (VR) technologies and products for the consumer and enterprise markets, announced a significant partnership with Toshiba Client Solutions Co. Ltd., a wholly owned subsidiary of Toshiba Corporation today.


This agreement announced today, validates the patented waveguide smart glasses technology held by Vuzix.

In the press release, Carl Pinto, vice president of marketing and product development for Toshiba Client Solutions Division, stated:

“We believe that Toshiba can leapfrog other wearable technology products with Vuzix’ support and look forward to a very successful collaboration between the companies.


“We have selected Vuzix as our new smart glasses development and manufacturing partner because we are very impressed with Vuzix’ current line of smart glasses and other technology that the Company has in development.” 

Under the terms of the agreement, Vuzix and Toshiba have embarked on a rapid development program with milestone payments totaling over one million US dollars. With development efforts well under way, Toshiba, subject to a final manufacturing agreement, expects to place additional purchase orders from Vuzix for production deliveries in the 4th quarter of 2017. Further details on the new smart glasses product will be released soon after public marketing of the product commences.

Strong Potential for VUZI Short Squeeze

VUZI can be a volatile stock.  Shorts have been all over it in recent weeks and have now shorted over 25% of the float. With today’s Toshiba announcement, expect more short covering next week, which could lead to the start of a short squeeze if enough new longs as well as covering shorts start hitting the ask.

For a more in-depth look at Vuzix Corporation’s patented technology in the AR space see: Vuzix Corporation (VUZI): New Vuzix Blade 3000 Augmented Reality Glasses a Game-Changer ), presented to subscribers at $6.15/share.

Also see: January 2017 VUZIX Investor Presentation.

dariohealth-logoDarioHealth Corp. (DRIO) has bullish chart pattern going into what will be a record Q4 report.

DarioHealth Corp. (NASDAQ:DRIO), (web site), is a digital health company that develops and commercializes patented and proprietary technologies providing consumers with laboratory-testing capabilities using smart phones and other mobile devices.

Its flagship product is the Dario Smart Diabetes Management Solution, a mobile, real-time, cloud-based, diabetes management solution based on a multi-feature software application combined with Dario Smart Meter, a pocket-sized, blood glucose monitoring device. DarioHealth Corp. has marketing clearance in Europe and the U.S. and the Dario iOS mobile app recently launched with reimbursement in the United Kingdom, Australia, Israel, Italy, and Canada. Additionally, DarioHealth has launched in New Zealand, the Netherlands, Italy, and Belgium.


Nothing drives share prices like strong revenue growth of 282% with more to come. Expect a record Q4 and full year 2016 report to come from DRIO for reasons I explained earlier this week. (see: DarioHealth Corp. (DRIO): Growing Sales By 282% With Record Q4 On Tap.)

DRIO shares are up 10% for the week, and I believe the advance is just beginning. The company only has a float of 2.9 million and can move with very little volume. Every indication points to a continuation of ultra-fast revenue growth as DRIO:

  • Continues rapid expansion in the U.S. market that was only fully underway late last year
  • Launches the Android version of the Smart Glucose Monitoring System
  • Launches in Germany

Bullish DRIO Chart

Technical analysis gurus swear by triple bottom formations as being extremely bullish indicators. DRIO put in a beautiful triple bottom formation as you can see:

With a record Q4 (and another record Q1 in my estimation), plus other near-term positive drivers, I expect to see DRIO shares continue the uptrend they’re now in.

See also:  


DarioHealth February 2017 Investor Presentation

Rodman and Renshaw Report: DarioHealth BUY $12 PT

Joseph Gunnar & Co. Report: DarioHealth BUY $8 PT

See: Terms of use/disclosures/disclaimer

Green Organic Dutchman - gary




Emblem Corp (EMC.V) to begin trading Monday, December 12.


Emblem Corp. logo

Emblem updated investors Friday with the statement:

Further to its press release dated December 7, 2016, the Company announces that it expects to close today its previously announced non-brokered private placement of units for gross proceeds of $787,500 (the “Private Placement”). Each unit will be comprised of one common share of the Company (a “Common Share”) and one-half of one Common Share purchase warrant, with each whole warrant entitling the holder thereof to acquire one Common Share for a period of thirty-six months from the date of issuance at an exercise price of $1.75 per Common Share. Closing of the Private Placement remains subject to final approval of the TSX Venture Exchange (the “Exchange”) and other standard closing conditions.

From a press release last week I think the Company sums up the opportunity for investors very clearly, stating:

Emblem’s unique pharmaceutical-like cannabinoid formulation approach is focused on optimizing strain selection and greatly expanding acceptance of medical marijuana therapy by both patients and healthcare professionals. It’s always been known that Cannabinoids have real therapeutic value, as evidenced by Cesamet, Marinol and Sativex all having been approved as prescription drugs. The active components in cannabis are extracted, purified, and incorporated into advanced dosage formulations.

And in case you missed it in our earlier article on Emblem (which you can read here),there’s a great Q&A by the BBC with the President of Emblem’s Pharmaceutical division, John H. Stewart you should read: Ex-big pharma executive behind OxyContin sells medical marijuana.

I’ll say again that I’m a buyer of Emblem on Monday. For those who don’t know me yet, I recognized the opportunity of 3D printing stocks and bought them heavily in 2012.  I then launched in the spring of 2013…well in advance of the enormous parabolic moves they made in 2014-early 2015. I believe we are in the first inning of a 12-24 month move in the cannabis space, and I think Emblem has the right management, the right business model, tight share structure, (6 million float), and support from founders/early investors to make the company a top tier cannabis stock going forward.


DarioHealth (DRIO), a pioneer in the mobile health space with a focus on diabetes management, announced the company had over 4,000 new sign ups from the U.S. alone during November’s Diabetes awareness month. I checked with the company for clarification and learned that “sign ups” means people with the Dario Smart Glucose Meter in the hands of end users. The device comes with 50 strips and data history has shown “that approx. 75% of those turn into strip buyers in 30-45 days after.”

Doing the math, average strip sales/customer is $300/year. 75% of 4,000 = 3,000 x $300 = estimate for $900,000 in new annual sales originating from the U.S. market alone from the month of November. To put this in perspective, for the entire Q3, DarioHealth sold about 5,500 Smart Glucose Meters in the U.S (see Q3 press release), and the company turned a (modest) gross profit.

In September DarioHealth also launched an online store in Canada in collaboration with A&D Medical, a global leader in connected health and biometric measurement devices and services, and Bayshore Specialty Rx Ltd.’s online pharmacy, Diabetes Express, and the Company’s Smart Glucose System is for sale in major pharmacies in Canada such as London Drugs (see Dario™ diabetes management tool turns your mobile device into a glucose monitor and more— now available in Canada).

As a result of fast growth in the U.S. market, the Company’s September launch in Canada, (plus an Australian launch in July), it’s clear that Q4 should be another record for the company. There are an estimated 415 million people worldwide living with diabetes according to the International Diabetes Federation, and DRIO is well-positioned to realize significant growth in helping people better manage their diabetes. In fact, they’re doing just that already.

Read more about DarioHealth in my initial article. Shares have gained 13% since then, and have a long way to go as more launches of  Dario’s Smart Glucose System take place around the globe, and what I think will be a very, very strong Q4 is reported.

Lastly, congratulations again to our subscribers in New Age Beverage Cop. (NBEV)!

Shares closed at a new high Friday of $4.17, a gain of 940% from our recommendation at .40 in April.

As I wrote back in April, the company had the following ingredients to drive shareholder value:

  • a laser-like focus dedicated to an unconsolidated, yet booming market
  • the right product that has strong competitive advantages in the market
  • a balance sheet that allows the company to focus on the new, or previously underutilized direction
  • the right management with the right connections and experience in the space to make the decisions that will drive success

And NBEV “remains one to watch” for the same reasons.

I’m pointing out NBEV here because both Emblem Corp. (EMC.V) and DarioHealth (DRIO) have within their respective management teams, business models, and market opportunities, the same ingredients for success going forward into 2017.


Best wishes for profitable investing,

Blue Line Protection - gary



site terms of use/disclosures and disclaimers

First, congratulations to our many subscribers in NBEV!

NBEV hit $3.60 this week…an 800% gain from our April recommendation at .40/share when the company was just beginning to enter the functional beverage market.


Our latest pick, DarioHealth (DRIO) has gained about 9% since our initial report.

For the moment, DRIO is a relatively unknown entity with a 50 day average volume of 35,000 shares trading, but look for more volume and investor awareness to come- and soon. The Mobile Health (mHealth) industry is just beginning to gain traction with investors, and DRIO is a true pioneer in the space.

Relative to other mHealth plays such as Fitbit (NYSE: FIT) at a $2.2 billion market cap, or 23X EPS, and MyFitnessPal, acquired by Under Armour (NYSE:UA) for $475 million, DRIO with just an $18 million market cap. is ridiculously undervalued, especially given the company grew sales by 166% last quarter and turned a gross profit. Fundamentals matter and they’re strong at DarioHealth (see Q3 Highlights).

Shares of DarioHealth closed on Friday at $3.30 on higher than average volume, and remain a long way from the $12/share price target Rodman and Renshaw has on the stock (see report).

Note that the 50 dma for DRIO shares is $3.29 so a continuation above that level on higher than average volume will be very bullish!

Get Ready for Emblem Trading to Start Friday, December 9th!

Emblem Corp. logo


Emblem Cannabis Corporation (TSX-V: EMC) is a licensed producer of Medical Marijuana in Canada, led by a team of former HealthCare & Pharma Executives who have built & run multi-billion dollar companies and have invested heavily into the company themselves.


Emblem Cannabis will trade on the TSX-V under the symbol EMC

Buying stocks listed on the Toronto Stock Exchange can be done using any major online broker in the U.S.

If you’ve never traded on an exchange outside of the U.S. before, you may need to get approval from your broker first. This is a simple matter of answering a few questions online or by speaking with your broker to gain access to the Toronto Stock Exchange.

Shares issued and outstanding: 37.3 million
Approximate float: 6 million
Estimated opening share price range: $1.00-$1.50
Web site:

We will have a full report on Emblem (TSX-V: EMC) out on Thursday so you can get a jump on the market.

For now, know this about Emblem:

  • The head of Emblem’s pharmaceutical division, John Stewart, launched the blockbuster drug, OxyContin when he was President and CEO of Purdue Pharma- see article Ex-big pharma executive behind OxyContin sells medical marijuana
  • Emblem recently completed a $23.7 million offering that sold out in a matter of days and was oversubscribed
  • Emblem (EMC) is now funded to begin phase 3 expansion, with plans to expand to over 12,000KG capacity and sales of $136 million at full production
  • Trading on Friday is expected to open between $1-$1.50/share. Trading with a symbol in the US is planned in the coming weeks
  • Buying the Canadian-listed EMC shares through your U.S. online broker could prove to be a very wise move! Once trading begins with a U.S.-based ticker in a few weeks, there will be stronger demand for a float of just 6 million shares
  • Emblem’s Founders and Management have built and managed multi-billion dollar companies in the health care and pharmaceutical industries, are heavily invested in the company themselves

In short, Emblem has all the ingredients to be a top tier cannabis stock in the near term as you’ll see in our report on Thursday!

Blue Line Protection - gary





Stocks Finish Friday Flat, While Wielding Weekly Gains

U.S. stocks finished the regular trading session near the unchanged mark as corporate earnings reports were in focus with the domestic economic front void of any major releases.

Technology issues moved higher as Dow member Microsoft easily bested expectations, while fellow Dow component General Electric reported revenues that fell short of forecasts. Global monetary policy and political uncertainty continued to elicit concerns.  Treasuries were mixed, while gold, the U.S. dollar and crude oil prices gained ground.

The Dow Jones Industrial Average (DJIA) lost 17 points (0.1%) to 18,146, the S&P 500 Index was unchanged at 2,141 and the Nasdaq Composite gained 16 points (0.3%) to 5,257.

In moderate volume, 851 million shares were traded on the NYSE and 1.6 billion shares changed hands on the Nasdaq. WTI crude oil decreased $0.22 to $50.85 per barrel, wholesale gasoline gained $0.04 to $1.53 per gallon and the Bloomberg gold spot price added $1.27 to $1,267.03 per ounce.

Elsewhere, the Dollar Index-a comparison of the U.S. dollar to six major world currencies-was 0.4% higher at 98.66. Markets were mostly higher for the week, as the DJIA gained nearly 0.1%, the S&P 500 Index increased 0.4% and the Nasdaq Composite was 0.8% higher.

Dow member Microsoft Corp. (MSFT $60) reported fiscal 1Q earnings-per-share (EPS) ex-items of $0.76, above the $0.68 FactSet estimate, as revenues rose 3.1% year-over-year (y/y) to $22.3 billion, versus the expected $21.7 billion. The company said its 1Q results showed continued demand for its cloud-based services. MSFT rallied. We had a good day led by our largest position FB 132.+2. We rebuilt our Swing Trade Portfolio this week going from 80% cash to 15% in cash.Our portfolio contains four recent IPO’S, a gold stock, and AAPL and FB.


Dow Jones 18,145.71-16.64 -0.09%

S&P 500 2141.16 -0.18  -0.01%

NASDAQ 5257.40 +15.56 +0.30%

WTI Crude Oil 50.86 +033 +0.45%

GOLD 1267.40 -0.10 -0.01%

SILVER 17.540 -0.009 -0.05%

10 Year Yield 1.740

DXY (USD Index) 98.651+0.33 +0.34%

Economic Activity for Monday
 US Chicago Fed National Activity 8:30 AM ET
 US PMI Manufacturing Index Flash 9:45 AM ET

Nasdaq Listed, EBITDA +, High Tech, Turnaround Stock Pick Released Tomorrow

coming up

We’ve discovered a fantastic turnaround stock play that we will release tomorrow morning, Monday, 10/24, at 9:30 am.

The company we’re profiling here at has about 3,000 customers currently and $28 million in revenue. Just recently the businesses “turned the corner”, delivering positive adjusted EBITDA of more than $400K in 2Q’16.

The company is disrupting its landscape by offering business customers Internet access for 40% below competitors, and management sees $70 million in revenue by 2020 vs. just $27 million during the trailing twelve month period. 

Our full report will be out tomorrow morning!

 tapimmune -gary pic

U.S. stocks closed higher on Friday, locking in their best quarterly gains since December 2015.

The S&P 500 gained 3.3% for the quarter ending September 30, the Dow advanced 2.1%, and the Nasdaq Composite rose 9.7%.


best small cap stocksThe monthly University of Michigan survey of consumer confidence rose in September to 91.2, up from 89.8 in August.

The reading is also 4.6% higher than this time last year.

Lynn Franco, Director of Economic Indicators at The Conference Board stated:

“Consumers’ assessment of present-day conditions improved, primarily the result of a more positive view of the labor market. Looking ahead, consumers are more upbeat about the short-term employment outlook, but somewhat neutral about business conditions and income prospects. Overall, consumers continue to rate current conditions favorably and foresee moderate economic expansion in the months ahead.”

Strong consumer sentiment bodes well for the U.S. economy (and stocks) heading into Q4, as consumer spending accounts for approximately 70% of economic growth in the U.S.


New Super High-Tech Solar Stock Pick Coming Wednesday

Solar stocks have had a tough time in the environment of low oil prices this year.  Sector leaders First Solar Inc. (FSLR) and SunPower Corp.(SPWR) hit lows not seen since 2013 just two weeks ago.

Then solar stocks put in a sharp rebound last week. 

The Guggenheim Solar ETF (TAN) may be putting in a double bottom, and a break above 22.00 would confirm it.




The bottom for solar stocks may be in, and this could be the perfect time to catch a great solar stock before it makes a major move.

The company I’ll be writing about is addressing the 3 major needs for solar technology to become truly commonplace:

  • Need for cheaper manufacturing
  • Need to reduce materials used
  • Need for greater efficiencies

The company is on the verge of commercializing heavily patented technology that sets industry-leading efficiencies, is lightweight and flexible, with low total system cost.

The company has existing top tier partnerships, positive forward drivers, and a cost effective approach to enter rapid commercialization.

Stay tuned!

Best wishes for profitable investing,

tapimmune -gary pic

best-microcap-stocks-during-market-volatilityVolatility was the word for the last 6 trading days, and that volatility will likely continue next week as the Federal Open Market Committee meets on Tuesday and Wednesday. The FOMC will announce their decision on interest rates Wednesday.

While there are plenty of data points to support a 1/4 point increase in long term rates in the U.S., the global economy isn’t there, and our recovery isn’t robust enough to cause meaningful inflationary pressure.  As of Friday, U.S. inflation advanced by a rate of 1.1% over the past year after gaining 0.8% in July. This is the lowest rate of inflation since the 12 months ended December, and my guess is they’ll sit pat for September and telegraph a raise in December.

At any rate 🙂 , The VIX (Chicago Board Options Exchange Volatility Index) has been very, very quiet since the June Brexit news roiled the market. Some say the VIX was too quiet during July and August, and I’m in that camp.

However, the VIX heated up this week to top 20 briefly, as some uncertainty over the Fed’s decision on rates crept into the market’s psyche.



As a measure of the “wall of worry” that the market must always climb, seeing the VIX spike up with some regularity every few months is healthy for the market over the longer term and should be seen in a positive light, especially after a such a historically quiet July and August. I was VERY HAPPY to see the markets rock and roll all over the place this week, and would like to see it continue for a while.

A correction of 5% or so in the next few weeks would be very bullish from my standpoint.

Should a 5-10% correction take place, (and many experts believe it’s coming), it will be a stock picker’s market, and you’ll want to find picks that:

  • have strong, positive near term drivers
  • are unlikely to be diluting shares soon
  • are a sector that’s currently in favor

Don’t worry, I have a few great suggestions that have all the above in place and I’ll begin writing about them starting next week!


Biotech is Hot (fact) and Going to Get Hotter (opinion which I’ll explain)

Biotech stocks have had a solid go of it for the last few months. The S&P Biotech Index is up 19.5% for the Quarter-to-Date (QTD) period, strongly outperforming all major market averages.

It’s noteworthy that biotechs have also outperformed their (usually much larger), pharma cousins…a trend which started in the summer and began to accelerate in early September as the chart below demonstrates.



In this presidential election year, Big Pharma is under increasing bipartisan scrutiny over pricing practices. I believe investors are defensively rotating some funds out of pharma and into biotechs as a result, as the tough talk and rhetoric over drug pricing will likely escalate as November gets closer.

Biotechs on Pharma Shopping Lists

There was a significant drop in the public valuations of biotech companies in the third quarter of 2015 that accelerated into the first half of 2016.  Average biotech share prices have only just begun to swing up in the most recent quarter.

As a result, many see biotech stocks at comparatively good values here, while at the same time, biotechnology innovation has been very successful. As we all know, pharmaceutical companies require new products and drug pipeline assets, and often look to biotechs for their pipeline needs. This is particularly true in certain therapeutic categories and for companies and products that address desirable targets. The growth of orphan drugs and drugs addressing unmet medical needs in specialty areas has been positive for biotech economics given the shortened development and approval times.

A very recent example of Big Pharma looking to smaller biotech acquisitions for pipeline assets is Japan’s largest drug company, Takeda Pharmaceutical (4502.T), Takeda announced last week they have set aside $10 billion to $15 billion for acquisitions in the United States and other markets.

Takeda’s Chief Executive, Christophe Weber explained:

“We are now much more focusing on the reinforcement of our pipeline because this is where we need to do something, so that in five years, when we start to see more significant patent expiries, we will have a pipeline to replace that.”

Biotechs that address unmet medical needs (particularly in cancer R&D) are stated targets for Takeda, and that’s true for Big Pharma in the U.S. as well. All it takes is for a few ginormous players like Takeda to start shopping around in biotech and you have a recipe for a sector that will outperform.

For these reasons I’m expecting biotech to continue to outperform pharma stocks and the market in general, at least through November.


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 best microcap stocks

Tech and Microcaps Lead The Way

Last week tech stocks led the way fueled by strong earning reports from Apple and Facebook, while the S&P 500 and DOW took a small breather and declined for the week. The NASDAQ and Russell 2000 extended the weekly winning streak to a 2016 high of 5 weeks with gains of 1.2% and 0.6% respectively. The S&P 500 closed down 0.1% for the week while the DOW finished down 0,7%.

2016 YTD Returns thru 7/29:

DOW: +5.8%
S&P 500: +6.3%
RUSSELL 2000: 7.4%
NASDAQ: +3.1%

Distance Below All-Time Highs thru 7/29:

DOW: Record 1.0%
S&P 500: Record 0.2%
RUSSELL 2000: 5.9%
NASDAQ: 1.3%

The VIX continues to trend downward and finished the week at 11.87 marking the lowest level since August 2015. A VIX level between 11 and 20 has proven to be a supportive level coinciding with broad market appreciation during the market expansion since the recent financial crisis.

Key Earnings Reports

Apple Tops Low Expectations

Apple (AAPL) reported earnings on Tuesday, which sent shares surging over 6% during Wednesday’s session. Apple’s Q3 EPS ($1.42A/$1.38E) and revenue ($42.4B A/$42.1B E) came in slightly above consensus estimates and the midpoint of Q4 guidance landed above analyst consensus estimates for Q4.
Apple’s iPhone unit sales declined 15% year-over-year, iPad unit sales declined 9% and Mac unit sales declined 11%. Revenue from other products declined 16% from a year ago.

Expectations were so low for Apple that despite a significant decline in product sales shares closed up over 5% for the week. Apple’s results sent RF filter shares of Qorvo (QRVO) and Skyworks (SWKS) higher last week.

Apple’s CEO Tim Cook was asked about augmented reality during the Q3 conference call and he had the following to say…..

“I notice there are people that want to call it a new computer platform, and we’ll see. I think there’s a tendency in this industry to call everything new the next computer platform. However, that said, I think AR can be huge. So we’ll see whether it’s the next platform. But regardless, it will be huge.” – Apple CEO Tim Cook

Despite the jump last week shares of Apple remain $30 or 22% below all-time highs reached April 2015.


Facebook Tops Estimates and Reaches New All-Time Highs

Facebook (FB) reported earnings on Wednesday, which sent shares to an all-time high of $128.53 on Thursday. Facebook’s market cap is now over $350B and currently ranks as the 7th largest US company ahead of Johnson and Johnson and just below Berkshire Hathaway.

Facebook’s Q2 revenue came in at $6.44B or $0.42B ahead of analyst expectations. EPS came in at $0.97 versus expectations of $0.82 for the quarter.

Facebook’s platform continued to show strength in numbers as the average of daily active users (DAUs) increased 15% year-over-year to 1.13 billion people. Monthly active users (MAUs) rose 15% to 1.71 billion people. Mobile users continued to outpace overall growth

growing by over 20% to 1.57 billion MAUs and 1.03 billion DAUs. Mobile users now account for over 91% of Facebook’s daily and monthly active user base. Strong DAUs and MAUs helped push total revenue up 59% year-over-year including advertising revenue growth of 63% to $6.2B.

Facebook’s CEO Mark Zuckerberg was asked about augmented reality and Pokemon GO during the Q2 conference call and he had the following to say…..

“Well, I, like everyone else, am enjoying Pokémon Go. And the biggest thing that I think we can take away from this as we invest in augmented reality in addition to virtual reality, is that the phone is probably going to be the mainstream consumer platform that a lot of these AR features first become mainstream rather than glasses form factor that people will wear on their face.” – Facebook CEO Mark Zuckerberg

Recent Picks

Our recent pick Cemtrex (CETX), which we covered Best Microcap Stocks Performance 2015at $2.26 on June 2, hit a high of $6.17 this week for a 173% gain in under 60 days

Our most recent pick, Dataram (DRAM), which we picked at $1.56 on 7/18 hit a high of $2.47, 58% higher than two weeks ago

American Brewing (ABRW) continues to consolidate in the 1.70-$1.90 range, following our initial report when ABRW was just .40/share


And by the way…if you’re reading this and are not yet a subscriber, it’s free!

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New contributor, Seth Golden, with new Cannabis Pick out Monday!

I’m pleased to announce that Seth Golden, a prolific and heavily-followed author on Seeking Alpha, is now contributing here at

Seth will be introducing a very promising stock in the legal Cannabis industry on Monday, 8/1/16.  This relatively unknown company has recently signed a game-changing partnership that should successfully ramp sales very, very rapidly.

Seth Golden has served the financial industry as an advisor and research analyst since 2008. Prior to 2008, Seth was a highly effective executive leader with Target Corporation and Bed Bath & Beyond. After leaving the retail sector, Seth began his career in the financial industry with Goldman Sachs and furthered his career through co-ownership and operation of Capital Ladder Advisory Group. With Capital Ladder Advisory Group, Seth has published several hundred pieces of analytical research, which have led to multiple business development projects with Fortune 500 companies as well as start-up enterprises seeking product placement in the market. As a retail and CPG industry expert, Seth’s serves as an advisor and intermediary for several public and private companies.He serves as an advisory and consultant with efforts geared toward establishing strategic relationships in these respective industries.

Best wishes for profitable investing,

Matt Margolis - GA sig

Another Week and Another Record Close

Major indexes closed on a high note Friday extending record highs set the previous week.  The S&P 500 and DOW extended recent gains and finished the week up 0.6% and 0.3% respectively.  Tech and Micro Caps continued their recent hot streak, but remain below all-time highs with the NASDAQ and the Russell 2000 delivering weekly gains of 1.4% and 0.6% respectively.


2016 YTD Returns thru 7/22:

DOW: +6.6%

S&P 500: +6.4%

RUSSELL 2000: 6.8%

NASDAQ: +1.9%


Distance Below All-Time Highs thru 7/22:

DOW: Record High

S&P 500: Record High

RUSSELL 2000: 6.4%

NASDAQ: 2.5%


The VIX continues to trend downward and finished the week at 12.02 marking the lowest level since August 2015. A VIX level between 11 and 20 has proven to be a supportive level coinciding with broad market appreciation during the market expansion since the recent financial crisis.

Calendar Q2 earning’s season is now in full swing and the broader market will be looking closely at quarterly earning’s reports.  Calendar Q2 earning’s reports will be used to gage the fair value of the overall and reset investor sentiment over the remainder of 2016.

Skyworks (SWKS) reported earnings on Thursday, which sent shares down over 8% during Friday’s session.  Skyworks Q3 EPS ($1.24A/$1.21E) and revenue ($751.7m A/$750 $750.2m E) came in above consensus estimates, however guidance for Q4 was flat and sent shares tumbling.  Shares of SWKS ended Friday’s session at $64.81 or nearly $50 below all-time highs set in June 2015.

Microsoft (MSFT) reported earnings on Tuesday, which sent shares soaring to just under $57 per share behind strong top-line and bottom-line growth.  Microsoft’s revenue came in at 22.6B or 460m and EPS came in at $0.69 or $0.11 above estimates. Microsoft continues to see strong growth coming from the cloud.  Shares of MSFT are now within $3 of its all-time record high set in December 1999 at the peak of the tech bubble.

Intel (INTC) reported Q2 earnings on Wednesday that beat on the bottom line by $0.08 per share but missed on revenue by $40m.  Overall Intel reported EPS of $0.59 and quarterly revenue of $13.5B.  Intel’s PC business continued to slide declining 3% year-over-year while Intel’s Data Center Group, which was once a double-digit growth engine grew by only 5% year-over-year.  Unlike Microsoft, which is closing in on all-time highs Intel remains over $40 below its record high of just under $76 set during the tech bubble in August 2000.


Microcap Research Roundup


Last week was a very exciting week for several of our Microcap Research stocks with a few names reaching new highs in 2016.  Last week we introduced Dataram (DRAM), an undervalued precious metals stock destined for much higher price levels.  DRAM finished the week at our initiation price of $1.56 but did rise as much as 15% following our coverage this week.   Our detailed report outlines why we feel DRAM is fairly valued at 2 to 3 times current valuations based on comparable gold mining stocks.


Shares of Cemtrex (CETX) finished the week up 20% closing at $5.06 and are now up 124% since we initiated coverage on June 2nd at $2.26 per share.  Shares of CETX are now closing in on all-time highs set April 2015.  Cemtrex recently announced that the company received $12m of new orders in the month of June as well as a buyback program authorizing the purchase of 1 million shares.


Shares of Vuzix (VUZI) finished the week by rising 11% on record daily volume.  The introduction of Pokemon Go has put augmented reality front in center for investors and Vuzix has emerged as a leading player in this industry.  Vuzix announced last week that the company recently shipped its first developer M300 augmented reality smart glasses in North America.


Shares of Actinium Pharmaceuticals (ATNM) finished the week up 4.7% as investors continued to digest a continuous flow of positive announcements from the company.  Actinium Pharmaceuticals announced that the company initiated a pivotal Phase 3 trial for Iomab-B on June 29th.  This past week Actinium Pharmaceuticals announced that the company completed a successful investigator meeting with bone marrow transplant physicians, care providers and clinical research coordinators from current and prospective clinical trial sites related to Iomab-B.


We continue to keep a close eye on 22nd Century Group (XXII), a plant biotechnology company focused on tobacco harm reduction and smoking cessation products that we highlighted earlier this year.  Recently the World Health Organization (WHO) recommended mandated reductions in nicotine to minimally addictive levels.  As organizations such as the World Health Organization continue to push to change to Tobacco Product Reguluation towards lower nicotine products it will continue to benefit XXII.  22nd Century Group remains the only company in the world that is producing naturally grown tobacco with nicotine at non-addictive levels currently being recommended by WHO and former U.S. FDA Commissioner Dr David Kessler.

New Pick Next Week!

As we look ahead to next week we are excited to share an exciting Penny Stock with our subscribers.  This company focuses on the service end of the cannabis industry, which continues to grow and train traction as an up and coming viable business and investment opportunity.

subscribe to best microcap stocks




Best wishes for profitable investing and trading!


Matt Margolis - GA sig

For those who were unable to participate in the American Brewing Company conference call today, the recorded call is available hereand the text of the call is below.


American Brewing Company

Good morning…and thank you for joining American Brewing Company, Inc.’s full year results ending December 31, 2015, investor conference call.

On today’s call we will have Brent Willis, Chief Executive Officer of American Brewing Company, and Lanny Lang, Chief Financial Officer.

On our call, Brent will provide some opening comments.  Lanny will provide an overview of our 2015 results and then turn back to Brent who will discuss our strategic priorities, the major factors impacting our business, and our business model for 2016.  We will then open the call to questions.

We remind you that this conference call contains certain forward-looking statements reflecting management’s current expectations regarding future results of operations, economic performance, financial condition and achievements of the Company. Forward-looking statements, specifically those concerning future performance, are subject to certain risks and uncertainties.

The transcript of today’s conference call will be available on the Company’s new website, within the investor section at

I’d now like to turn the call over to Brent….



A quick thanks to everyone participating on the call, the first ever investor conference call for American Brewing.  As previously announced, I was asked to join the Board of Directors of the company and to take on the Interim Chief Executive Officer role, and last week I decided to do so.


Why?  Well, I did my due diligence and had others do some for me too and the conclusion was this is a massive opportunity.  I never do anything small, and we used to have a saying at AB InBev, that it is as much work to do something, as it is to do something huge – so you might as well go big.   No one on the planet believed that we could take a small little Belgian brewer, that no one had ever even heard of, and make it into the world’s largest but we did against some pretty strong competitors.   This opportunity, with Bucha Live Kombucha, won’t go from $2 Billion to $100 Billion like InBev, but there is no question in my mind that this brand, in this category, in this window of opportunity, is an absolute winner.


In anything I get involved in I look at three sources of risk – I keep it simple… and it has worked pretty well for me.  I look at #1 demand risk, #2 technology risk, and #3 execution risk.


First, from a demand risk standpoint, with Bucha, we have great category growth… and relatively weak competition.  There is a great built-in source of revenue to draw from with one competitor that is $400 million in revenue.  We just want our fair share of this – which frankly we define as all of it.


Second risk, technology, here, we are the disruptive tech both vs. the rest of the traditional beverage industry with a healthy functional beverage, but also vs. all other kombucha’s in the sector, with our proprietary production process that is a real competitive advantage.


The final risk to look at is execution risk.  We define this as having the people, processes, systems, information, and culture that leads to superior performance.  Here, in my assessment we have a long way to go.  It is all about execution, but this is what we know how to do.   It sounds mundane, but in the beverage business, this is what it is all about, and with búcha, it is not a question of if, it is just a question of when – how long, it will take to achieve our goals.


Now before we get into how we will achieve success and some of our keys to it, including how we will build the búcha brand, I’d like to ask Lanny Lang, our acting Chief Financial Officer that comes via the Eventus Advisory Group, to review last year’s financial history and full year results.




Lanny Lang

Thanks Brent and welcome aboard. There is a lot here, and there has been a tremendous amount of clean up over the past year, and I have been working on the financials, supporting that transformation during that period.


Let me now take you into the details of the 2015 financial results, but let me please caution you, that the results are 9 months under American Brewing leadership, plus 3 months under B&R, the previous owners.  That combination for 2015 is being compared to 12 months of financials under B&R in the prior year.  It is confusing, but it is an accounting requirement of the SEC to view the financial results in this way.


With that being said, on a full year basis ending December 31, 2015, revenue achieved $2.42 million vs. $2.78 million in the prior 12-month period ending December 31, 2014, a decrease of 13.2%.  More than 100% of this decrease was related to two factors.   First, was the Company’s decision to exit one major account that was unprofitable at the time of the acquisition.   Second, in the transition from the previous ownership, other accounts were also compromised.  In combination, these two impacts totaled more than $950 thousand dollars.  So on an apples to apples basis, although it is a non-gaap measure, sales would have been up more than 30% excluding those impacts, and we expect to recover those accounts going forward.


Form a gross profit standpoint, cost of goods sold were in line with last year, up one half of one percent, with the exception of depreciation and amortization of customer relationships.  Including those impacts, COGS increased 5% vs. prior year.  Overall gross margin for the year was 17.1% vs. 31.5% in the prior year.  This impact is due to a change in accounting treatment for freight, labor, and promotional expenses vs. how the previous ownership accounted for these line items.


Independent of accounting treatment however, the gross margin for either 2014 or 2015, represents a “significant opportunity for improvement.”  That ’s corporate code for “its terrible”, historically, but a tremendous opportunity going forward at the same time.  A full cost accounting review by every single input into COGS and shipping and supply chain is underway, in addition to a review of every supply arrangement and cost input into the company’s products.


Moving on to operating expenses, they were down 24% vs. prior year.  Great result, right?  Wrong.  Because G&A was actually up over 103%, or more than $630 thousand…and what got cut was sales and marketing.  That hurts the brand and the long-term intangible franchise value..  In fairness, there was an ownership transition integration, and other one-time expenses, and $320 thousand of the G&A was non cash stemming from accounting for equity awards.  Notwithstanding, the opex opportunity is the next area of overhaul that we will be addressing.

At the bottom line, in Operating income, the Company lost $972.7 thousand on a full year basis vs. a loss of $891.4 thousand in the prior year, or an increase of 9.1%.

From a balance sheet standpoint, assets are essentially in line with liabilities, with current liabilities down a significant 52% vs. prior year, or a reduction of more than $619 thousand.


In summary, looking at the financial performance for 2015 it is difficult to draw definitive conclusions given:

  • This was a year of acquisition and integration of the business
  • This was a year that also included a sale of the brewery business, …and
  • There were multiple moving parts in the integration, and multiple challenges in maintaining sales and customers just before the business was acquired


With those caveats, a few things are inarguable that we believe are fair takeaways:


First, there is real sales momentum in the business in existing accounts, we believe north of 30%.  We had a few causalities in the transition, but we expect to regain them, because our brand sells and sells well, in a fast-growing category.


Second, our cost of goods sold and gross margin is completely unacceptable.  A wholesale bottom up cost accounting of every input is already underway mandated by the new leadership, and this is in the first week on the job.


And third, the balance sheet looks substantially better with significantly reduced debt on the positive side of the ledger, but operating expenses are not being well controlled.


Fixable? Absolutely… but it will take fiscal and operating expense discipline, and detailed work on the aspects of costs.  How will we do that….. is why we have a new CEO and leader ….with a track record of discipline and taking on difficult challenges….  and with that I’d like to pass it over to Brent to discuss our plan going forward.   Brent.


Brent Willis

Thanks Lanny.  Here’s how I read the 10K …Underlying positive momentum with customers and topline growth – a real determinant of health, and it looks ok.


But we were only in roughly 1,500 stores last year.  Driving this is beverage industry 101 basics, and has the highest ROI of any activity.


The next germane point from the 10k, the gross margin and COGS, although it is essentially the same as most of our competitors, is in a word, abysmal.  We will fix it, and it will take some heavy lifting – but we will get these things done.


I do give tremendous credit to the leadership over the past year in integrating the business, cleaning it up, getting rid of any lingering issues, and paying down the debt – on which they did a great job.


Because there is now such a solid foundation, it provides a springboard to accelerate the Bucha live kombucha brand, and we are experienced hands at doing this, it is not really that hard, but does take focus and discipline and unrelenting tenacity – fortunately all tenets of our approach to driving businesses.


So let’s talk about our approach, what we’re going to do, and from that – how you can create a financial model on which to determine earnings expectations going forward for the enterprise.


First off, what are we working with?  What do we have to build on?  Well, I am happy to report that we have three sources of competitive advantage:


#1) we have a preferred flavor with búcha.  In recent independent quantitative research, búcha was ranked as superior in taste vs. competition, with a top two box score, preferred or strongly preferred of 76%, or 43% above competition.


Why such a significant difference and preference of Bucha?  Well, I personally believe most of the Kombucha competitors have an acquired taste.  It is quite acidic and vinegary in finish, which frankly is appealing to a subset of consumers.  What the research tells us though, is that consumers prefer the mainstream appealing flavor and balance of búcha.  It still has the fermented tea notes and kombucha brewed flavor, but because of our proprietary production process – unique in the industry, we end up with an elegant, complex, refreshing, and clean, really beautiful product.


This brings us to our next competitive advantage.  #2) our unique production process that leads to búcha

  1. being the most consistent product in the category
  2. having the longest shelf life in the category with 9 months vs. many competitors at 90 days. Implication – well it means it is easier for the retailer, distributor, shipper, everyone – by an incalculable margin. Búcha is the only competitor, that essentially has a functional/workable supply chain for major beverage national distribution systems or future partners.  – and,
  3. the production process ensures, beyond a shadow of a doubt, that there is no secondary fermentation – so as a result, no risk of increase in alcohol above the FDA trace limitations – and
  4. it is the production process – that leads to elimination of elimination of nasty aftertaste associated with most kombuchas.  Of course we have our secret formulas and unique ingredients, that we keep locked up, but its our proprietary processes that gives an enormous strength vs. competitors in flavor profile, quality, consistency, and shelf life.


Our third competitive advantage on which to build is that we are actually significantly outselling competition on an apples-to-apples basis in sales per point of distribution. A review of IRI and specific customer data across key accounts over the past 52 weeks, indicate sales of the búcha live kombucha brand significantly outpacing competition. And this is despite a lack of promotional support, poorer shelf placement, virtually no marketing, and the transition pains that the company experienced over the past year.


So, that’s what we have, now, what are we going to do with it? How are we going to financially improve it, and how can it be modeled?


Here’s the plan – and we are only going to do three things…but we are going to do them better than anyone else on the planet.


Number one, we are going to expand distribution in both depth and breadth.  Last year búcha was in close to 1,500 food, mass and specialty outlets.  In the beverage industry, your highest ROI driver is distribution.   So far this year already, we have added distribution in Shaw’s in the Northeast and Jewel in the Midwest to go with previous distribution in Kroger, Safeway, Whole Foods, Ralphs, Vons and others, so we have just eclipsed 2000 stores.


But, we are still in only 2000 stores, not 20,000 or 200,000 so we have a big upside in front of us, and over the 30 days, I will be personally in front of customers representing more than 5,000 outlets.


This is the first part of the model, and a good current input should be around 2,000 dollars in revenue per store per year for every new point of distribution.   Take the total number of existing and new outlets, and then take an additional multiplier by driving more distribution depth.


What we mean by this is that we are only doing around $2,000 in net revenue per individual store.  But, this is done with poor relative shelf space, limited in-store promotions, no point of sale, and no marketing.  Winning at the Point of sale also has significant ROI, relative to other investments, and we can expect to increase this shelf throughput throughout the year, increasing our revenue per outlet multiplier.


The next thing we are going to do, and next part of the financial model, is to improve cost of goods sold, gross margin and supply chain costs.  We are going to do this concurrently with our first strategy of expanding distribution.


We have already started the cost accounting line item review of every input, glass, cardboard, production, warehousing, shipping, teas, fruits, and every ingredient and production process to rearchitect our supply chain and significantly improve margin.  Today we have one outsourced manufacturer, in one location, in Southern California.  We ship finished good heavy filled glass bottles from there, to across the country, refrigerated by the way.


In the future, we will have multiple production points and our distribution of finished gods will be closer to the last 30 miles vs. today that’s more like the first 3,000, and all these actions will have a very positive effect on our gross profit.


Also we are going to run a tight ship in opex.  Financial model wise, G&A can be expected to decline as a percent of sales every year, and I expect G&A to go from 44% of net sales in 2015 to at least a 15% of net sales over time.  But also within expenses – last year we spent 10% of net sales in Advertising, Promotion, and Selling.   I would expect it to run closer to 20% of net sales over time.


In that statement is a very important distinction – the spending will be variable.  There will be no aggressive forward spend on marketing.  It is stupid to advertise to empty shelves, and that is why driving distribution is our first strategy.  Then, as new accounts come on, and revenue accrues from those accounts, we will intelligently spend back, as a percent of sales to drive consumer offtake and sales per point of distribution.


So, in summary from a business model standpoint, one can expect topline growth in line with that of the category, plus incremental topline growth coming from distribution breadth and depth improvement.  2nd – a fundamental change in gross margin, and third opex control with G&A running at less than half of historical levels, and with sales and marketing at around 20% of net sales over time.


The last thing I want to discuss on the call today is our plans to build the búcha brand, and you can bet your búcha we are going to build it.  Why, – well to gain retail distribution, retailers will require it, so there is no choice, one goes hand in hand with the other.


We also have to build the búcha brand because in the ultimate analysis of value for our company, the búcha brand will be our most valuable intangible asset.  I had a shareholder ask me, what about all the dilution you are going to cause me with a multi-million dollar marketing campaign?  The right question should have been, how can you invest more in marketing to build the búcha brand to be the market leader faster.  That’s where the money and valuation is and desire from major potential distribution partners.


The second reason why we all want more spent in marketing, is the variable spending principle – it means that if we are spending more, we are growing the topline more, and only spending back, out of cash flow after we earn it.  Even if we had more investment or free cash, which we don’t by the way, to invest in marketing, we wouldn’t do it.  We would invest it in broadening distribution.



So what are we going to invest in?  What is great about this category and this brand is that it is very social media centric.  This is not a brand for TV, print, promotion, or other traditional…and expensive marketing mediums.  On the contrary, we would argue that those mediums are absolutely wrong for the brand.  This is a quirky, all natural, 100% certified organic, California, healthy brand, with 1 billion live microorganisms inside every serving.


As such, the mediums to tap into people’s social graphs, to build the tribe and followings amongst that group, can be done significantly more cost effectively.  One of the key’s here is to build core brand advocates, measured by Facebook likes, number of twitter followers, and those types of targeted media.  Here, we call our brand advocates – búchadors, and we want to build an army of these fanatics tapping into the maslovian belongingness needs of this target audience.  It is our core búchadors that we will be the tipping point opinion leaders from which to concentrically build out.


Consistent with the notion of building our tribe, we need an inclusionary rallying cry.  Our call to action will be built around the proposition to all consumers, to “Kom Bucha with as”, an invitation to become a fellow búchador or búchadora.  To become part of the tribe, the “in” crowd, that is committed to all things natural, all things good, for the environment, for their fellow búchadors, and for themselves.  It is an inclusionary message, and you can bet your búcha, we are going to have some fun with it.  This is a group that craves content, so the content we will …claim and rename as the authority on “good, and good for you,” is anything related to healthy and healthy lifestyle – especially as it relates to any beverage that we choose to put into our bodies.

The final component of marketing that we are going to invest in is continual new news, with new and exciting, on-trend flavors.  Consumers love trying new things, and they do, especially in this category.  This year we are rolling out 3 new flavors to compliment our existing line-up including Lemon-Lime Ginger, Tropical Honey Blossom Ginger, and Elderflower Green Tea.   Everyone seems to love them and they were a huge hit and highlight at the recent natural foods expo that búcha participated in.   The elderflower product has only 47 calories and is a perfectly balanced blend of organic black tea, organic green tea, organic kombucha, and elderflower.     It is crisp, clean, and refreshing and aerobically brewed according to our secret formula for almost 30 days.


So, in closing, I would say this opportunity is fantastic, and I am energized and excite to be a part of it.  It may not be as big as some of the things I have worked on in the past, but it will be, and it will be a very fun journey along the way.


We have a fast growing category, and it just getting started.  The category is a disruptor versus other beverage types, and búcha is a disruptor within the category.


Execution wise, this is not complicated, hard work, but not complicated.  We have something no one has our sources of competitive advantage in preferred flavor, in production process, in quality, in shelf life, and in the fact that we are outselling competition on the shelf.



These are foundations on which you can really build, a really big business, and tribe of fanatic búchadors and búchadoras, inviting others to become part of our healthy organic and natural movement. Thank you and we encourage you all to “Kom Bucha with Us.”

Best wishes for profitable investing!

Gary Anderson sig.