Advanced Photonix Inc fka API

[Katfish]

API - .7316 Very good analysis of API going forward.

http://www.smallcapnetwork.com/Advanced-Photonix-is-Burning-a-Little-Brighter-Every-Day-HON-VSH-API/s/via/1789/article/view/p/mid/2/id/136/

Advanced Photonix is Burning a Little Brighter Every Day (HON, VSH, API)
Honeywell International Inc. (NYSE:HON) and Vishay Intertechnology (NYSE:VSH) are big names, but sometimes, small cap stocks like Advanced Photonix, Inc. (NYSEMKT:API) are better bets.

When most investors think of optical sensor makers, they tend to think of larger names like Honeywell International Inc. (NYSE: HON) or Vishay Intertechnology (NYSE: VSH). And well they should. VSH is a $2 billion company, and HON is a $71.5 billion organization. The fact is, however, there are a few small cap stocks in the optical sensor space that are worth a look, and one of them is worth a very close look right now for a very clear reason... Advanced Photonix, Inc. (NYSEMKT: API).

What's the reason an investor would want to choose $25 million API over a Vishay Intertechnology or a Honeywell International? Because Advanced Photonix shares are actually, you know, going higher, and have a lot more upside potential than those two much larger stocks.

First and foremost, Advanced Photonix is a turnaround story... and not just because the company says it's a turnaround story, but rather, because the company is putting up numbers that confirm it, and is projected by third-party analysts to continue doing so in the future. In fiscal 2012 (ending March of 2013), API booked multi-year low sales of $23.6 million, but for the past four quarters has generated a top line of $26.5 million. Advanced Photonix still booked a loss for the twelve-month period, or $3.6 million, but compared to 2012's loss of $4.4 million, it's easy to concede API is at least pointed in the right direction.

But still, how can an investor choose API over Vishay Intertechnology or Honeywell International, both of which are profitable on a trailing basis, and both of which are expected to be profitable for the foreseeable future? Answer: Because Advanced Photonix, Inc. is projected to swing to a profit in the coming fiscal year (beginning in April), and a swing to a profit is the kind of thing that inspires the market to pile in particularly in the world of small cap stocks - regardless of the extent of its impending profitability.

For perspective, the company's per-share earnings figure is expected to roll in at 11 cents in fiscal 2015 (calendar 2014, mostly). At that rate, API shares are priced at a palatable forward-looking P/E of 11.9. Accordingly, revenue should grow by 25% in the coming year, allowing that swing back into the black. Not too many other small cap stocks can boast the same.

With all that being said, the biggest reason of all a would-be investor would want to consider a position in Advanced Photonix now is because the market finally believes in the company again - the chart says so.

After falling back from a high of $2.74 in early 2011 to a low of $0.38 in late 2012, many investors put API on a shelf, assuming it would never do anyone ay good again. Big mistake. Since then, this small cap has made a string of higher highs and higher lows, and has done so on rising volume. A few days' worth of bullishness can be dismissed. But more than a year's worth? No, that's a long-term undertow at work, underscored by the way the turnaround has been a smooth, well-organized U-shaped effort. And, better still, Advanced Photonix is doing a nice job of pushing past resistance around the $0.75 and $0.80 levels.


While it would seem prudent to wait for API to get and stay above that last line in the sand at $0.80, it may also be an unnecessary precaution. Yes, the stock's down to $0.75 today after brushing a high of $0.85 this morning, but the back-and-forth action has been the norm since early 2012. The dip today is a buying opportunity. The longer-term clues are convincing enough as is.

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