A great penny stock
Today I added Geomet Inc (GMET) to the Barchart Van Meerten Speculative portfolio. An independent energy company primarily engaged in the exploration for and development and production of natural gas from coal seams (coalbed methane or CBM) and non-conventional shallow gas. Geomet's principal operations and producing properties are located in the Cahaba Basin in Alabama and the Central Appalachian Basin in West Virginia and Virginia. Geomet also controls additional coal bed methane and oil and gas development rights, principally in Alabama, British Columbia, Virginia, and West Virginia.
The company hold development rights on about 200,000 acres all in the US and Canada so political disruptions shouldn't hamper them.
The stock is a recent mover hitting 17 new highs and a price appreciation of 68.86% in the last month. Since the Relative Strength Index is 80.48% and still climbing its not running out of steam yet. The momentum has earned it a 96% Barchart technical buy signal. It trades around 1.36 which is well above its 50 day moving average of .87.
Even though this is a penny mineral stock 2 Wall Street brokerage firms are following it and have published buy recommendations for their clients based on projected next year increases in revenue of 16.50% and an earnings increase of 12.50% next year. They estimate a compounded 5 year EPS growth rate of 15.00%.
This small cap stock is followed by the CAPS members on Motley Fool and they think the stock will beat the market by a vote of 61 to 11.
The stock was added because:
1 - 96% Barchart technical buy signal
2 - 17 new highs and up 68.86% in the last month
3 - Wall Street brokerage buy report based on estimates double digit increases in both sales and earnings
4 - A small but positive investor sentiment
Jim Van Meerten is an advisor to Marketocracy Capital Managementwho uses his model portfolios not only to manage their mutual funds but also their clients Separately Managed Accounts. You can read his blogs about those model portfolios and investing here and on Barchart Portfolio Blogs. Please leave a comment below or emailJimVanMeerten@gmail.com.
Disclosure: Jim Van Meerten through Marketocracy Capital Management has an interest in the stocks mentioned in this blog.