The shares of LMI Aerospace (LMIA: sentiment, chart, options) have skyrocketed this afternoon, soared more than 15% higher following its earnings report. The firm boasted a fourth-quarter profit of $3.8 million, or 34 cents per share, a 43% improvement over its year-ago profit of $2.7 million, or 24 cents per share. Sales during the quarter jumped 81% to $54.6 million. Analysts had predicted a profit of 34 cents per share. LMI Aerospace reported that its results were boosted by the acquisition of D3 Technologies.
Looking ahead, LMIA affirmed its 2008 sales forecast of $241 million to $259 million and expects $9 million to $10 million in capital expenditures this year.
Encountering Resistance
The security has added roughly 16% in trading this afternoon, climbing above potential resistance at the stock's 50-day moving average. However, the stock's upside has been capped by the 21 level – an area that has hindered the security's rally attempts since January 25. In fact, the equity has been trapped in a sideways channel since mid-January.
However, from a longer-term perspective, the equity has climbed above resistance at its declining 10-week moving average. LMIA has not logged a single weekly close above this trendline since the start of 2008.
Checking out the stock's monthly charts, we find that the equity is currently perched on support at its 32-month trendline.
An Undiscovered Gem?
LMIA could prove to be an undiscovered gem within the trading community. The stock currently does not trade options, so it has yet to garner the attention of this crowd. Furthermore, only 2% of the company's total float has been sold short, indicating the short sellers had paying the equity little heed. Meanwhile, Wall Street has yet to discover the stock. According to Zacks, only 2 brokerage firms currently offer up an opinion on the stock, with both giving the security a "hold" rating. Any fresh coverage from the various brokerage firms could definitely add some lift to the shares.
For timely commentary on today's market-moving news from me and my colleagues Andrea, Elizabeth, Joseph, and Mark, please visit our Schaeffer's Daily Market Blog section throughout the trading day.
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