A computer services stock that insiders love right now is MagicJack VocalTec (CALL), a provider of carrier-class voice over Internet protocol and convergence solutions for fixed and wireless communication service providers. Insiders are buying this stock into some impressive strength, with shares up over 63% so far in 2012.
MagicJack VocalTec has a market cap of $470 million and an enterprise value of $432 million. This stock trades at a reasonable valuation, with a forward price-to-earnings of 13.58. Its estimated growth rate for the next quarter is 100%, and for next year it's pegged at 29.9%. This is a cash-rich company, since the total cash position on its balance sheet is $36.89 million and its total debt is just $5 million.A director just bought 22,000 shares, or $507,000 worth of stock, at $22.86 per share. From a technical perspective, CALL is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the past six months, with shares soaring from a low of $10 to a recent high off $28.22 a share. During that uptrend, the stock has consistently made higher lows and higher highs, which is bullish technical price action. That said, the stock has pulled back off its recent high of $28.22 and is not sitting right above its 50-day moving average of $22 a share. If you're a bullish on CALL, I would look for long-biased trades once this stock breaks out above some near-term overhead resistance at $25.30 a share with high-volume. Look for volume on that move that's near or well above its three-month average action of 432,876 shares. If we get that action soon, I would then add to any long positions once CALL takes out its 52-week high of $28.22 a share with volume. If you buy this stock off weakness in an effort to anticipate the breakout, then keep in mind that the nearest major support levels are the 50-day at $22 and then $19.60 to $18 a share. In order to increase the probability of CALL breaking out soon, then it's probably important that $19.60 holds up as support. I also featured MagicJack early this week in "7 Stocks Rising on Big Volume."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV