| NVEC In-depth Analysis, Symmetrical Triangles, $SOX, Bullish Percent Index, Point And Figure, QQQQs, NASDAQ, Update |
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| May 26, 2008 |
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NVE Corporation Reports Fourth Quarter and Fiscal Year Results
Net income increases 50 percent for fiscal year
EDEN PRAIRIE, Minn.—May 7, 2008—NVE Corporation (Nasdaq: NVEC) announced today financial results for the quarter and fiscal year ended March 31, 2008.
Total revenue for the fourth quarter of fiscal 2008 increased 33% to $6.05 million from $4.57 million in the prior-year quarter. The revenue increase was primarily due to a 35% increase in product sales to $5.67 million for the fourth quarter of fiscal 2008 from $4.19 million in the prior-year quarter. Net income for the fourth quarter of fiscal 2008 increased 45% to $2.25 million, or $0.47 per diluted share, compared to $1.55 million, or $0.33 per diluted share, for the prior-year quarter. Gross margin was 69% of revenue, operating margin 55%, pretax margin 59%, and net margin 37% for the quarter.
For fiscal 2008, total revenue increased 25% to $20.5 million from $16.5 million for the prior year, driven by a 28% increase in product sales to $18.5 million from $14.4 million for fiscal 2007. Net income for fiscal 2008 increased 50% to $7.19 million, or $1.51 per diluted share compared to $4.78 million, or $1.00 per diluted share, for fiscal 2007. For fiscal 2008 gross margin was 67%, operating margin 49%, pretax margin 54%, and net margin 35%.
"We are pleased to report record revenue and net income for the quarter and fiscal year," said NVE President and Chief Executive Officer Daniel A. Baker, Ph.D. "Increases in product sales and operating margins drove an extraordinary quarter and fiscal year.
"In the past fiscal year we introduced new world-class spintronic products, expanded our production capacity, and were granted four U.S. patents," said Baker. "We enter fiscal 2009 with products that are in demand, an excellent intellectual property portfolio, and a solid balance sheet."
NVE is a leader in the practical commercialization of spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store and transmit information. The company manufactures high-performance spintronic products including sensors and couplers that are used to acquire and transmit data. NVE has also licensed its spintronic magnetoresistive random access memory technology, commonly known as MRAM.
Symmetrical Triangle Chart Pattern
Introduction
The triangle pattern, also called the "coil," appears in three varieties:
1. symmetrical, 2. ascending, and 3. descending.
Generally, a triangle pattern is considered to be a continuation or consolidation pattern. Sometimes, however, the formation marks a reversal of a trend.
Symmetrical triangles are generally considered neutral, ascending triangles are bullish, and descending triangles are bearish. From a time perspective, triangles are usually considered to be intermediate patterns. Usually, it takes longer than a month to form a triangle. Seldom will a triangle last longer than three months. If a triangle pattern does take longer than three months to complete, Murphy advises that the formation will take on major trend significance.
What does a symmetrical triangle look like?
Converging trendlines of support and resistance gives the triangle pattern its distinctive shape. This occurs, Kahn explains, because "the trading action gets tighter and tighter until the market breaks out with great force." Buyers and sellers find themselves in a period where they are not sure where the market is headed. Their uncertainty is marked by their actions of buying and selling sooner, making the pattern look like an increasingly tight coil moving across the chart.
As the range between the peaks and troughs marking the progression of price narrows, the trendlines meet at the "apex," located at the right of the chart. The "base" of the triangle is the vertical line at the left of the chart which measures the vertical height of the pattern.
The point and figure chart is a study of pure price movement in that time is not taken into consideration while plotting the price action. Since only price changes are recorded, if no price change occurs then the chart is left untouched.
Point & Figure charts use rising columns of X's and descending columns of O's to represent these price movements.
What an investor sees when looking at a P&F chart is the underlying supply and demand of the security. The columns of X's illustrate demand exceeding supply (rally), and the columns of O's illustrate supply exceeding demand (decline).
1. What constitutes a basic point and figure up a “buy” signal
2. What constitutes a basic point and figure up a “sell” signal
In the point and figure methodology a buy signal occurs when one column of Xs exceeds a previous column of Xs. A sell signal occurs when one column of Os exceeds a previous column of Os. Let’s look at examples.
Battle Between Supply and Demand.
The PnF Chart depicts the battle between Supply and Demand. There are two basic signals that develop. They are the Double Top Buy signal and the Double Bottom Sell signal. These are the two most basic patterns and it is imperative that you understand them.
A buy signal shows demand is in control of the stock. It occurs when a column of Xs exceeds the previous column of Xs.
A sell signal shows supply is in control. In this case the stock exceeded the previous column of Os.
The Double Top Break
A double top break occurs when a chart, in Xs, runs into resistance. Supply gains control and the chart reverses into Os. Demand then regains control of the chart and it reverses back into Xs where it rallies to the previous resistance. Here the double top is formed. When the chart is able exceed this resistance level and rise another box it gives the double top break.
 
The Double Bottom Break
A double bottom break occurs when a chart, in Os, falls to support. Demand gains control and the chart reverses into Xs. Supply then regains control of the chart and it reverses back into Os where it falls to the previous support. Here the double bottom is formed. When the chart drops enough to move below this support level and fall another box it gives the double bottom break.
 
(Illustrations courtesy Dorsey Wright)
NVEC Point And Figure
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