Ellie Mae Inc (ELLI) and More: Four Early Movers On Friday … Are Any Presenting Value?

The company is what I consider to be fairly valued. It has had a rough year in terms of performance and this is the quarter that could lead to a larger trend higher. It trades with a price/sales of 5.44, which is appropriate considering its growth, and has significant room to expand its operating margins of 3.45%. Overall, the quarter was strong, the outlook is great, and this appears to be a company on the rise.

Conclusion

Too often we associate stock performance with fundamental performance, yet it’s the inconsistencies between these two factors that create value. The ability to identify these inconsistencies is a psychological behavior-changing skill that very few investors are able to perfect. I have talked about this subject in great detail, and have taught investors how to change these tendencies to return large gains. My advice is to become a smart investor, by learning how to logically assess what caused a stock to move compared to its valuation, or by learning how to first read a quarterly report before admiring the stock’s reaction. Then, if there is a distinction in value you are able to capitalize on the value.

The article Four Early Movers On Friday … Are Any Presenting Value? originally appeared on Fool.com and is written by Brian Nichols.

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