Singular Research Director’s Letter : August 2018

An Unheralded Record

Singular list tops S&P 500 but lags Russell 2000 in August.



Last Month


Trailing 12 Mo’s





S&P 500














Meanwhile, the S&P 500 set a record for duration of a bull market exceeding 10 years. In August, measured from its lows at 666 this represents an eye-popping 330 % return.
However, if you were among the unfortunate whom invested in the tech bubble in the year 2000 when the S&P 500 floated at the 1500 level your returns are a much less impressive + 90%. Or a price appreciation of about 4% per year.

Despite near-record optimism and employment on top of a record bull market, professional money managers believe this is the peak. More than 58% of them believe that 2019 will be a down year. 
Many seem to be underestimating the earnings power that has been unleashed by tax cuts and deregulation.


Symbol Rating Target Month Return Comment
CTRL BUY  $30.00


 Beat & raise, provides year end guidance
NVEE BUY  $ 52.00


 Beat & raise, raises year end guidance
QNST BUY  $ 16.75


 Rebound from post eps report sell-off
EBS BUY  $60.00


 Makes announcement of large acquisition
HBP BUY  $ 9.75


 Better than expected revenues

In August, our top performer was Control 4 (CTRL) + 27.4%  an emerging leader in smart home technology topped earnings forecasts and guided for solid numbers into 2019. NV5 (NVEE), popped + 17.5%. NV5, an environmental and energy Focused E&C firm topped expectations and guided higher. NVEE, one of our top picks over the last two years nearly tripling. New initiation, Quinstreet, a leader in digital marketing (QNST) ticked up 14.4%.

Symbol Rating Target Month Return Comment
SALM BUY  $ 9.00


 Gives back prior month’s gain on weak earnings report
BLX BUY  $33.65


 Misses estimates ,higher than expected costs
HNNA BUY  $23.75


 Aum outflows offset small acquisition
DAKT BUY  $12.00


 Lower backlogs projected
GASS BUY  $ 6.00


 Profit taking

Salem Media (SALM) lead to the downside falling – 22.2%, reversing much of the gains from the previous two months as earnings disappointed again. Banco Latino Americano (BLX) was off 13% as lower spreads from higher interest rates hurt net income. HNNA fell 7.4% as continued Capital outflows pressured earnings.

Please join us September 20th in Dallas for our Midwestern values conference where will be focusing on several of the names mentioned above and other under covered, under followed and misunderstood situations that we believe can perform exceptionally well over the next 12 months. Visit

At singular research we wish to thank our clients and followers for their continued commitment and support of our unbiased Independence research.

Singular Research Staff

Earnings Surprises and Disappointments – Q2 2018

Top Three Surprises

  1. JMP Group LLC (JMP) +256%
  • Had record investment banking revenues
  • Increased accumulation of loans leading up to the CLO V pricing
  • Had a favorable exit from a principal investment
  • Investment banking revenues were up 49.3% yoy and asset management revenues were up 29.5% yoy


  1. Anika Therapeutics (ANIK) +106%
  • Maintained the #1 overall position in the U.S. viscosupplementation market
  • S. viscosupplement franchise grew 12% in Q2
  • Completed an accelerated share repurchase program from May to July, with ~800,000 shares repurchased
  • Product gross margin improved by 10% on a sequential basis


  1. Olympia Financial Group (OLY) +99%
  • Earnings before income tax increased 61% to $3.72 million from $2.31 million.
  • Total revenue, including interest earned as trustee and interest, increased 28% to $13.18 million from $10.26 million. The increase is due to an increase in service revenue in the Foreign Exchange division and Registered Plans division and interest earned as trustee in the Registered Plans division.  
  • Service revenue increased 25% to $10.31 million from $8.28 million due to an increase in trade volume and transaction sizes in the Foreign Exchange division and fees charged in connection with the restructuring of an exempt market issuer in the Registered Plans division.
  • Interest revenue on monies held in trust and interest on Olympia’s own cash increased 45% to $2.87 million from $1.98 million due to increases in the Canadian prime rate.


Top 3 Disappointments

  1. Full House Resorts (FLL) -433%
  • Net Revenue Grew 2.8%, Net Loss Improved 56.6%, and Adjusted EBITDA Increased 19.7%
  • Ferry Boat Christened at Rising Star Casino Resort; Anticipate Commencing Ferry Service This Quarter
  • Silver Slipper Casino & Hotel Preparing for Launch of Sports Betting Within the Next Few Weeks
  • Development Agreement for Expansion of Bronco Billy’s Casino & Hotel Approved; Currently Finalizing Construction Contracts for Phase One of the Expansion
  • Submitted Letter of Intent to Participate in New Mexico Racing Commission’s Competitive Process for State’s Sixth Racing License
  1. Daktronics (DAKT) -280%
  • Reported net sales of $154.2 million, operating income of $4.0 million, and net income of $4.6 million, or $0.10 per diluted share, compared to net sales of $172.7 million, operating income of $11.7 million, and net income of $8.4 million, or $0.19 per diluted share, for the first quarter of fiscal 2018. 
  • Fiscal 2019 first quarter orders were $159.6 million, compared to $153.1 million for the first quarter of fiscal 2018.
  • Product order backlog at the end of the fiscal 2019 first quarter was $177 million, compared to a backlog of $184 million a year earlier and $171 million at the end of the fourth quarter of fiscal 2018. 
  • Reece Kurtenbach, chairman, president and chief executive officer stated, “As expected, first quarter sales were less than the first quarter of 2018 and reflect the financial fluctuations caused by the timing of large projects. Year to date orders have increased over last year, and we achieved a respectable gross profit margin on this level of business. During the quarter, we installed several of the new generation of narrow pixel pitch products for high resolution indoor applications. We continue to invest in broadening our narrow pixel pitch product line and control solutions. Our pipeline of innovative new products and technologies is poised to meet the growing market demand for digital canvases.” 


  1. A-Mark Precious Metals (AMRK) -250%
  • Revenues for the three months ended December 31, 2017 decreased 21% to $1.68 billion from $2.13 billion for the three months ended December 31, 2016 and decreased 22% from $2.16 billion for the three months ended September 30, 2017
  • Gross profit for the three months ended December 31, 2017 decreased 10% to $8.9 million from $9.9 million for the three months ended December 31, 2016 and increased 22% from $7.3 million for the three months ended September 30, 2017
  • Net loss for the three months ended December 31, 2017 totaled $0.2 million or $(0.03) per diluted share (which includes $0.3 million of additional tax expense as a result of the recently enacted Tax Cuts and Jobs Act), as compared to net income of $2.8 million or $0.39 per diluted share for the three months ended December 31, 2016 and net income of $0.5 million or $0.07 per diluted share for the three months ended September 30, 2017

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Singular Research Director’s Letter : July 2018

EARNINGS Trump Tariff Talk

The singular coverage list nudged ahead beating the benchmark in July.
The Singular coverage list was up 2.13 % vs. 1.50% for the Russell 2000 and 3.39% for the S&P 500 as big caps led driven by strong earnings reports.

  Last Month YTD Trailing 12 Mo’s  
SINGULAR LIST 2.13% -0.05% 7.38%  
S&P 500 3.39% 4.77% 13.39%  
RUSSELL 2000 1.50% 7.85% 16.20%  


Trump continues to talk tough on trade, calling out China, Europe, Mexico, and Canada recently. The market doesn’t seem too disturbed, taking it all in stride and to the dismay of a mainstream media which is decrying the dire circumstances these tariffs will create for the global economy.
Most investors see this as Trump technique, with an initial extreme position taken, then moving towards the center, in pursuit of a positive outcome for U.S economic objectives.

Earnings continue to impress

With the second quarter nearly in the books, eps surprises have been dominate as
79% of S&P 500 companies have beaten the estimates. This will mark one of the highest beat ratios since the year 2000. Top EPS beaters for Singular include:  Anika Therapeutics (ANIK), +105%, Control 4 (CTRL) +29% and Emergent Bio solutions (EBS) + 21% above  Street consensus estimates.


 Cracks in the dynasty

Facebook (FB), Netflix NFLX, and Twitter (TWTR) all disappointed on MAU growth and offered disappointing guidance.  Is the possible plateauing of this metric a harbinger of flattening growth ahead? These social media glamour heroes have been knocked down nearly 20% as of late. The strategy of buy the FAANG and go away, may be losing luster and coming to an end which would bode favorably for the rest of the market as investors seek out other stock plays to provide Alpha.


Top winners and losers.

National mortgage insurance Holdings (NMIH) was top performer, driven by strong earnings and a debt capital raise that increased earnings capacity. EVIO Inc.
(EVIO), was the weakest performer as capital was reallocated to larger caps with stronger near term fundamentals.




Symbol Rating Target Month Return Comment
NMIH BUY  $  17.50 28.2% strong eps and guidance
ANIK BUY  $  60.00 25.1% relief rally from oversold condition on better than expected eps
TRNS BUY  $  20.00 20.9% strong eps beat . Higher margins from cost reductions
NVEE BUY  $  52.00 8.7%  
EBS BUY  $  60.00 7.7%  


Symbol Rating Target Month Return Comment
EVIO BUY  $2.00                -22.0% continued decline from disappointing near term execution
HNNA BUY  $  23.75 -9.8% profit talking on in line quarter
LYTS BUY  $9.80                -8.4% C-level departs creating selling pressures
QNST BUY  $  16.75 -7.7%  
GASS BUY  $6.00                -5.3%  

New initiations

We launched coverage on Internet marketing specialist Quinstreet Inc. (QNST), a firm that is well positioned to capitalize on the ongoing shift from traditional to digital ad spending, and also on Geospace Technologies Corp. (GEOS), a leading manufacturer of seismic equipment for the oil and gas exploration industry which we believe is in the beginning stages of a significant turnaround.

At Singular Research we wish to thank our clients and followers for their continued commitment and support of our unbiased, independence research model as we strive to consistently deliver Alpha generated from the lack of coverage outperformance anomaly.



Singular Research

Singular Research Director’s Letter : June 2018

Steady in June despite trade war rumblings and another rate hike

Despite headwinds from the specter of a looming trade War with China, a hike in interest rates and domestic political fervor over immigration policies, US markets, in what is historically a flat month, managed to eke out a slight gain in June, +48 basis points for the S & P 500. Many of these elements are negatives for large caps but could serve to benefit the performance of domestic small caps. The Singular Research coverage list performed in line with major domestic equity indices for the month of June.

Our top performers for June were: 1) Salem Media +35.5% bolstered from The District Court ruling clearing the humungous At&t- Time Warner merger. 2) Harvard Biosciences (HBIO) drawing renewed investor interest with analyst’s increased estimates for 2019, and 3) NV 5 Inc. (NVEE) benefiting from and improving outlook for domestic engineering & construction activity in 2018.

Our worst performers for June were: 1) Anika Therapeutics (ANIK) which received a setback from results in clinical tests on its Cingal product, 2) Wisdom Tree Investments ( WETF) suffering from market perceptions possible continuing outflows from its currency sensitive funds that are negatively correlated with the dollar, since this is a short call it is actually a positive refund for investors and : 3) Huttig Building Products ( HBP) disappointing investors hoping for a quicker resolution to its search for a new CFO.

In June we dropped coverage on : 1) Gray TV ( GTN) as its acquisition announcement of Raycom created a huge move up in price that nearly equally our 12-month target and : 2) (STMP) which reached out price target of $275 . Thus it has appreciated over 300% since we incepted coverage nearly 3 years ago.

Finally, we want to thank our loyal clients for their strong support and confidence over the last twelve years.


Singular Research Staff

Singular Research Director’s Letter : May 2018

Earnings surprise and positive guidance drive upside surprises.

May proved to be a good month to hold and stay.  The Singular coverage list had a good month, up 3.3% outperforming the S&P but lagging the Russell 2000 which was up nearly 6%.

The month was dominated by the close of a very strong earning season where aggregate S&P earnings were up nearly 23%. The other dominant trend was small caps began to pull away from their big cap brethren. We believe this outperformance is well supported by economic fundamentals. Small caps are more domestic focused and thus less vulnerable to International political- economic headwinds, also they seem to be benefiting from lower corporate tax rates and slightly rising interest rates due to lower levels of debt and previous inability to benefit from Financial engineering that buffeted big caps.

Finally, and possibly most significantly small caps tend to perform well when small business confidence increases. The index of small business confidence is at its highest level in over a decade.

Singular Research monthly performance May 2018



Our top performers for the month were lead by Olympia Financial (OLY). Olympia up 24.6%. It benefited from a strong earnings report and is supported by an attractive dividend yield of over 5%. 
Salem media followed with a 20.6% return, rebounding from an extreme oversold position condition. Investors also are starting to look towards the 2018 midterms and the increased ad revenue that will generate for the company.
Nmi Holdings improved 20.2% this stock is benefiting from the strong economy and prospects for longer and improved housing starts this year.

Singular Research top performers






Our worst performers to were led by EVIO, Inc, a Cannabis testing company,  down 29.4% due to a disappointing earnings report. Harvard Bioscience followed with a negative 23.5% return caused by profit-taking from its run of nearly a hundred percent over the last two very months.  Our third-worst performer was Biolase down 23.4% impacted by the departure of its CEO.

Singular Research worst performers May 2018




In May we initiated coverage on two new names. We started Wisdom tree Investments (WETF) with a sell due to its exposure to currencies and increased competition.  We launched Cordoba Minerals (CDB) with a buy as we believe the prospects of this Canadian Resource company for the development and discovery of copper and gold are bright in the years ahead.

Finally, we want to thank our loyal clients for their strong support and confidence over the last twelve years.


Singular Staff

Singular Research May 2018 Webcalls


Event:                        Video Cast
Harvard Bioscience (HBIO) Click here to view Video Cast
General Finance Corporation (GFN) Click here to view Video Cast
Trecora Resources (TREC) Click here to view Video Cast
Cordoba (CDB) Click here to view Video Cast
EVIO Labs Inc. (EVIO) Click here to view Video Cast

Singular Research Director’s Letter : April 2018

Fake Earnings

The U.S Equity markets are not getting any much credit from the tax cuts yet this year. Earnings will be up a record 21%, the best showing in many years. We will focus on revenue growth in the quarter ahead as well as estimates and guidance. Investors are trying to figure out what the real rate of earnings growth is at this point counter balanced against rising interest rates. It looks like the peak for operating margins is in as real growth is lower margin vs financially engineered eps growth.

The” FANG “, continues to bang earnings growth as well as rank among the top spending corporations with lobbyists in DC as forward-thinking monopolists are paving the way for future growth, evidenced by the recent Facebook testimony in front of Congress. Where is the outrage? Where are the new proposals to protect our privacy? Facebook. will still be allowed to self-regulate. What would you pay for 20 to 25% earnings growth for the next five – ten years with virtually no competition. Certainly, more than the 20 to 30% premium the “FANG” is trading to the market right now.

Earnings are to the upside with q3 expected to be up over 20% as well. Valuations are not crazy either at a slight premium to the five-year average and historical average. Interest rates are still below average. But the market seems fairly valued and higher earnings are needed to propel the market higher from this level. Is the Fed neutral, based on money supply growth and GDP growth this seems to be the case. Should we worry that the spread between the two year and ten-year government bond is narrowing down to 40 basis points? Usually this is a strong indicator that a recession on the horizon. Meanwhile, the leading economic indicators continue to edge higher, a very good sign for the economy and the market.

In summary, it might be good to hold in May and go play. It looks like the market is going to have to grind it out until it has for evidence that there is solid earnings growth ahead into early 2019. Also, the mid-term elections in November will start to become an overhang and provide another potential negative for the market.
Another key question, will the market normalize and take the benefit of the tax cut and reinvest into the real economy or continue to engage in financial engineering via share buybacks and M&A.

Don’t get faked out, Stay long.

Singular Research Monthly Performance April 2018

April’s top performers combined were an eclectic bunch with varied influences likely contributing to outperformance. General Finance (GFN) posted a strong q1 and raised estimates slightly. EVIO Inc, (EVIO) was a new initiation with favorable news on growth plans, and Huttig Building Products, Inc. ( HBP) bounced back from an extreme oversold condition.

Top 5 Performers

The worst performer list had was led by LSI Industries (LYTS), hit with a surprise resignation of its CEO, followed by NMI Holdings (NMIH), suffering from some surprising price cuts by a competitor that spooked the market on the outlook for future margins, and closely followed to the downside by Salem Media( SALM), as investors continued to abandon a sector perceived to be another casualty of technological disruption and an aging audience.

Worst 5 Performers

We are excited to announce new coverage on EVIO Inc. (EVIO). EVIO Inc. is a leading provider of quality control testing, consulting and advisory services to the cannabis industry. The company owns 9 laboratories serving five states in the US – California, Colorado, Massachusetts, Oregon and Florida.
At Singular Research, we continue to seek out investment ideas that have minimal to no Wall Street coverage to add alpha for our active institutional following. We thank our clients for your support of independent equity research.


Singular Staff

Singular Research Director’s Letter : March 2018

Tough Talk Reverses Rebound

After experiencing an impressive bounce from the prior month’s sell-off, equity markets staged a short-lived rebound that was squelched by fears of a trade war between U.S and China. Although the trade banter has simmered, new anxiety has arisen regarding higher secular inflation and aggressive moves by the special council against Trump. Moving into April, market participants await q1 eps reports to match vs. high expectations as the apex of good news on earnings is feared while eps growth vs. rising rates battle continues.

March’s top performers were led by eps beaters and a couple oversold bouncers. As our coverage list and the R2K showed a positive divergence from a decline of over 3% in the S&P 500. Will this become a trend? Too early to detect a change in leadership as of press time. NV 5 Corp. (NVEE), up 28.9% in March, blew away our estimates and CEO Dickerson Wright attested to the strongest operating environment he has witnessed in many cycles. Trecora Resources, (TREC), recovered from a plant shutdown and benefited from a strong lift in operations to beat eps estimates by a wide margin. A-Mark Precious Metals Inc, (AMRK) aided by increased concerns of trade wars and a subsequent increase in market volatility, posted a 10% gain in March.

The worst performer list was largely impacted by disappointing eps reports and/ or guidance. NMI Holding, Inc, (NHIM) was hit by market fears of higher rates and an imminent peak in housing starts. Salem Media (SALM) continued to battle a secular decline in industry fundamentals while it struggles to beat estimates. Acme United (ACU), our inaugural pick , at $9 when we incepted over twelve years ago, while continuing to execute its successful growth plan over the long term, has experienced some occasional bumps, including some execution adjustments as it transitions to online marketing.

In March, we dropped coverage on Vasco Data Services, (VDSI), as it continued to struggle with a transition from a hardware to a software based business model , missing estimates consistently over the last twelve months. We initiated coverage of Olympia Financial, ( an Canadian based financial services company with a diversified array of growing products and services with a Buy-Long term rating.

At Singular Research, we continue to seek out investment ideas that have minimal to no Wall Street coverage to add alpha for our active institutional following. We thank our clients for your support of independent equity research.


Singular Staff

Lawrence Kudlow to Become Trump’s White House Economic Adviser

Robert Maltbie & Singular Research for appointment to Trump team.  Watch “Larry Kudlow interview Sept 22, 2016 : “How to Grow Again” on YouTube.


Singular Research Director’s Letter : February 2018

Hello Volatility

After a near two year hiatus, with the VIX trending at the historical low end of 11-14 bp level, volatility exploded after an employment report showed higher than expected wage growth, pointing to higher interest rates. All the leveraged short vol funds took a huge hit that send shock waves into the broader equity market, creating the first 10% sell-off since early 2016. Better than expected earnings and upward revisions and positive economic news led the markets to recoup to only a 3-4% down draw for February.

February’s top performers combined good eps reports with lower valuations to buck the stiff sell–off. Our top performer was NMI Holdings, Inc.( NMIH) + 8.17%, a mortgage insurer riding the housing recovery. Hennessy Advisors Inc. (HNNA) +4.36%, an undervalued micro-cap posted good earning while our analyst increased his price target . New York Times Co. ( NYT), a short call went against the grain, posing an earnings beat extending the Trump Bump to readership growth.

The worst performers list had some large down draws. Led by Huttig Building Products, Inc. (HBP) -27 %, this suffered from an unexpected departure of its CFO. Next in line was Anika Therapeutics Inc. (ANIK), -22%, hit by tepid guidance and the retirement of its CEO and founder. Finally, dropping over 17%, A-Mark Precious Metals, Inc. (AMRK) missed estimates due to the low volatility in metals, combined with higher than expected acquisition costs.

We are excited to announce new coverage on LSI Industries Inc. (LYTS), a designer of LED indoor and outdoor lighting systems servings retail and industrial sectors. LYTS posted a better than expected quarter last month, led by a new management team and new product offerings. Also, we launched coverage on Full House Resorts Inc. (FLL), a micro-cap Hotel and Casino resort operator that trades at a significant discount to its peers and is also in the process of a major turnaround. At Singular Research, we continue to seek out investment ideas that have minimal to no Wall Street coverage to add alpha for our active institutional following. We thank our clients for your support of independent equity research.


Singular Research