Penny Stock Pick - LOUD

Penny stock of the day is Loudeye Corp. (LOUD), a Seattle WA based software company providing business-to-business (B2B) digital media service. Last Wednesday the company raised the fourth quarter revenue forecast to $8.8 million, up from previous forecast of $8 million and also planned to cut job to reduce costs by $2.5 million per quarter. The cost cuting initiative should help strengthen the company's financial by helping trimming the net loss.

Technical
The 52 week technical chart shows the why the stock has been on a rally as MACD rises above 0 and KD crosses up towards 80. Although the stock is now trading above 50 day moving average, it has yet to break thru the 200 day moving average and will need more up sessions to bring the 50 day moving average up. One technical indicator to watch is ROC which is now around overbuy level.

Insider
Most transactions recently from top executives have been sale of the stock. However net purchase from institutions have been up 22.8% and should offset the selling pressure from the insiders. Nevertheless, sell of stock from the mangement team is generally not a good sign for the stock.

Financial
The company's annual revenue grew 5 million from 2003 to 2004 and should be expected to grow another 8 million in 2005. However the company will probably see huge increase in net loss which is why the company is trying to reduce the cost in human resource to trim the net loss.

Penny Stock Score (1~5) 5 is highest
1. Market Potential(digital media): 4
2. News Buzz: 4
3. Technical: 4
4. Insider: 2
5. Financial: 3
Recommendation: Buy