Will Bullish Momentum For This Penny Stock Continue?
When it comes to your penny stock portfolio, diversification is key
. That doesnt just mean having gold and silver or oil and gas. Penny stocks offer a lot more diversification options than large-cap stocks. This is mainly because penny stocks are small companies that operate in niche markets. Unlike their large-cap peers, penny stocks do not monopolize a market.
One hundred years ago, airplanes were a niche marketnot so much nowadays. Jumping from the pages of science fiction in the 1960s, cryogenics has yet to gain the same kind of traction. That doesnt mean it isnt entering the mainstream.
Currently, there are over 200 people (including baseball legend Ted Williams) in a frozen state at cryonics centers in the U.S.and some 2,000 people have signed up for it. (Source:www.abcnews.go.com)
Its not just people that are being frozen; embryos, umbilical cords, stem cells, and human tissue are also being cryogenically frozen to later aid in medical procedures. Similar to cryogenics, cryopreservation is a process in which cells or whole tissues are preserved by cooling to around -196 degrees Celsius (or -320.8 degrees Fahrenheit). At this temperature, any biological activity, including reactions that would cause cellular death, is effectively stopped.
CryoLife, Inc. (NYSE/CRY) preserves and distributes human tissues for transplantation in the U.S. and internationally. The company also develops, manufactures, and commercializes medical devices for cardiac and vascular applications.
This penny stock takes human heart valves and blood vessels from deceased volunteer donors, processes them, and then stores them in liquid nitrogen freezers (a process called cryopreservation). It then ships them to surgeons nationwide, who implant them during cardiac and vascular repair procedures.
CryoLife has $4.0 million in cash, no long-term debt, and levered free cash flow of $17.1 million. In August, CryoLife announced that it had initiated a quarterly cash dividend of $0.025 per share.
In July, the penny stock company announced that second-quarter revenue was up 13% year-over-year at $33.2 million. Net income was up 83.3% at $3.3 million, or $0.12 per share.
Back in June, the company settled ongoing litigation. CryoLife was paid $3.5 million to settle a distribution agreement and was not required to pay $1.7 million for previously purchased inventory.
Since the beginning of June, CryoLifes share price has been trending steadily higher after settling a lawsuit, reporting strong second-quarter (Q2) results, and speculation. In early August, the 50-day moving average (MA) passed the 200-day MA, signaling a bullish sentiment. Recently, this penny stocks share price climbed to a nearly three-year high.
Currently overbought, CryoLife could consolidate in the near term or retrace on profit taking. While there seems to be major support at $6.00, a look at Fibonacci retracement suggests that there could be additional support levels at $6.64, $6.46, and $6.27if the share price breaks below the current support.
Still, with great fundamentals, a solid outlook, and an annual dividend of 1.5%, CryoLife remains bullish and continues to have great long-term growth potential.
by: Penny Stock Detectives
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