Growth and momentum stocks have been pulling back significantly in the past couple of weeks, although analyst estimates continue to climb, and it now trades at a reasonable valuation of 12X forward earnings. It is a small ($1.0B market cap) company, but its balance sheet is growing, margins have been expanding, it has low levels of debt, and valuations are now at reasonable levels. Although, we do not like the recent negative momentum, and in general, we prefer not to try and 'catch falling knives', but rather we would look to see where it can find levels of support and start a new uptrend before initiating or adding to a position here. We continue to like it, but we would like to see it find a level of support before taking any action on the name.
5i Research Answer: