MagicJack VocalTec Ltd. (NASDAQ: CALL) is featured by Zacks this morning as the momentum stock of the day with its chart analysis below. At issue is the recent growth news after it sold more than 365,000 of its new MagicJack Plus devices between November 20th and December 20th. Zacks sees a very strong quarter after having canceled a secondary offering and resuming its share buy-back program.
How does a company go from a secondary offering stock to buying back stock? That was a bit of a puzzlement.
Investors need to know that MagicJack is not for the timid. The company is tightly controlled, it is not a large cap stock and it is not extremely liquid on every trading day. The stock is also trading at about 37 times earnings and has a forward multiple of more than 13-times. Over the past 12 weeks, the stock outperformed the S&P 500’s performance by 16% with a price jump of over 21%.
On the chart below, Zacks noted, “On the chart, shares have been rallying since rallying since August after bottoming out during the market downturn and before the release of their latest product. The stock is no doubt volatile, but for those with an appetite for a little more risk, look for support around the 50 and 200 day moving averages of $12.20 and $11.20 respectively.”
JON C. OGG
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