SNU stocks that may be the ones to watch in 2017

Poised for big move in 2017?

At SNU we see a lot of stocks and write about those that we believe are, or will be, a hot topic. We searched through our screeners for five we believe investors might want to pay attention to in the coming year. The following are small-cap Nasdaq stocks that have good volumes, priced between $5 and $20, have good insider trading characteristics, and experts believe will have superior 2017 earnings.

FRED – Fred’s, Inc. sells general merchandise through its retail discount stores and full service pharmacies. The company, through its stores, offers household cleaning supplies, health and beauty aids, disposable diapers, pet foods, paper products, various food and beverage products, and pharmaceuticals to low, middle, and fixed income families in small- to medium- sized towns. It also sells general merchandise to franchised Fred’s stores. As of January 30, 2016, the company operated 641 company-owned stores in 15 states and 18 franchised stores under the Fred’s name, as well as 372 pharmacies and 3 specialty pharmacy facilities primarily in the southeastern United States. It also operates 18 franchised stores under the Fred’s name. Fred’s, Inc. was founded in 1947 and is headquartered in Memphis, Tennessee.

CONN – Conn’s, Inc. is a specialty retailer of durable consumer goods and related services in the United States. The company’s stores provide home appliances comprising refrigerators, freezers, washers, dryers, dishwashers, and ranges; furniture and mattress, including furniture and related accessories for the living room, dining room, and bedroom, as well as traditional and specialty mattresses; and home office products consisting of computers, tablets, printers, and accessories. Its stores also offer consumer electronics, such as LED, OLED, Ultra HD, and Internet-ready televisions; and Blu-ray players, and home theater and portable audio equipment. Conn’s, Inc. also provides repair service agreements, installment credit plans, and various credit insurance products. As of March 29, 2016, the company operated approximately 100 retail locations in Arizona, Colorado, Georgia, Louisiana, Mississippi, Nevada, New Mexico, North Carolina, Oklahoma, South Carolina, Tennessee, and Texas. Conn’s, Inc. was founded in 1890 and is based in The Woodlands, Texas.

KTOS – Kratos Defense & Security Solutions, Inc. provides mission critical products, solutions, and services primarily for Government and commercial customers. The company operates through three segments – Kratos Government Solutions, Unmanned Systems, and Public Safety & Security. The Kratos Government Solutions segment offers microwave electronic products; satellite communications; technical and training solutions; modular systems; and defense and rocket support services. The Unmanned Systems segment provides unmanned aerial, ground, seaborne and command, control, and communications systems. The Public Safety & Security segment offers integrated solutions for homeland security, public safety, and critical infrastructure, as well as security and surveillance systems. This segment serves critical infrastructure, power generation, power transport, nuclear energy, financial, IT, healthcare, education, transportation, and petro-chemical industries, as well as government and military customers. The company was founded in 1994 and is headquartered in San Diego, California.

MDCA – MDC Partners Inc. provides marketing, advertising, activation, communications, and strategic consulting solutions worldwide. Its Advertising and Communications segment offers multi-channel media management and optimization; interactive and mobile marketing; direct marketing; database and customer relationship management; sales promotion; corporate communications; market research; data analytics and insights; corporate identity, design, and branding services; social media communications; product and service innovation; and e-commerce management. The company was formerly known as MDC Corporation Inc. and changed its name to MDC Partners Inc. in January 2004. MDC Partners Inc., founded in 1980, is headquartered in New York, New York.

EGLE – Eagle Bulk Shipping Inc., through its subsidiaries, engages in the global ocean transportation of dry bulk cargoes. The company owns, charters, and operates dry bulk vessels that transport a range of bulk cargoes, including coal, grain, ore, pet coke, cement, and fertilizers. As of December 31, 2015, it owned and operated a fleet of 44 oceangoing vessels, which include 43 Supramax and 1 Handymax vessels with a combined carrying capacity of approximately 2,404,064 deadweight tons. Eagle Bulk Shipping Inc.,founded in 2005, is headquartered in Stamford, Connecticut.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

Fred’s Pharmacy (Nasdaq: FRED) Acquiring 950 Rite Aid Stores

Fred’s Inc.; Nasdaq: FRED

Shares of $FRED are up over 80% on acquisition news. Fred’s Inc. today announced that the Company has signed an agreement with Walgreens Boots Alliance, Inc. (NASDAQ: $WBA) and Rite Aid Corporation (NYSE: $RAD) to purchase 865 stores in an all-cash transaction valued at $950 million.

The agreement was born of concerns by the Federal Trade Commission in its review of the proposed acquisition of Rite Aid by Walgreens Boots Alliance. The Walgreen Boots Alliance stated in their press release: “Walgreens Boots Alliance is actively engaged in discussions with the FTC regarding the transaction and is working toward a close of the Rite Aid acquisition in early calendar 2017.”

Fred’s Pharmacy Chief Executive Officer Michael K. Bloom, commented, “This will be a transformative event for Fred’s Pharmacy that will accelerate our healthcare growth strategy through our acquisition of 865 new stores located in highly attractive markets. We believe that this transaction will also create tremendous opportunities for both our new and existing front of store and pharmacy team members.”

Walgreens (Nasdaq: $WBA) shares hit $87.26 (+1.4%) on the news. Rite Aid (NYSE: $RAD) is up over 5% at $8.63. $FRED shares closed yesterday at $11.15. Today shares of $FRED have traded as high as $20.42.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

Ticker Symbol FRED
Last Price a/o 11:09 AM EST  $             19.62
Average Volume 322,600
Market Cap $406.3 million
Sales $2.15 Billion
Shares Outstanding 36.44 million
Share Float 35.1 million
Shortable Yes
Optionable Yes
Inside Ownership 5.90%
Short Float 8.43%
Short Interest Ratio 9.16
Quarterly Return 14.96%
YTD Return -30.54%
Year Return -25.64%