| Stock (Symbol) | Stock Price | |
Ancestory.com (ACOM) |
$32 |
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| Data is as of | Expected to Report | Sector |
March 23, 2011 |
Apr 25 |
Technology |
| Sharek’s Take | ||
 Note: The data in this article is from December 6, 2010. ACOM broke past $30 yesterday and is selling at around $34 as this article is being written. I will purchase Ancestory.com (ACOM) in the Growth Portfolio and Aggressive Growth Portfolio today.Ancestory.com is a combination of retail and technology. The company is the world’s largest online family history resource, and people can subscribe to the website www.ancestory.com for $20 per month or $155 per year. What makes ACOM unique is it owns vast databases of family history — which will be hard or impossible to duplicate. This database gives the company a competitive advantage and barriers to entry. |
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| One-Year Chart | ||
 ACOMs one-year shows the original breakout at $22 back in September. The stock also broke out yesterday, whisking past $30 on the way to $33 by the close (this is not shown in this chart, as the chart was done in December).Profit growth has been great in three of the last four quarters. Estimates look solid too. At around 30 times earnings this stock isn’t a real bargain, but the idea is unique and Internet based companies are often very profitable. |
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| Earnings Table | ||
 Profit growth was 140% last quarter, which had many eyes (including mine) watching ACOM stock. Revenue growth has accelerated from 15% to 21%, 36% and 39% during the last four quarters.ACOM beat the street by 5 cents last quarter, and has beaten in each quarter since going public in November 2009. It’s tough to assume the company will keep beating estimates since I don’t have a firm grasp on ACOM’s expenses each quarter. Annual Profit Estimates just increased, so this stock has good momentum. 2012 estimates really jumped, from $1.14 to $1.33. I think ACOM can grow profits faster than revenue long-term because it already owns a lot of data. The costs will be buying new data, and putting it online. Estimates for the next four quarters look solid, and these estimates just increased. ACOM is a good stock — it fits the mold. |
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| Fair Value | ||
 ACOM is worth 40 times earnings. That means $40 a share is the current fair value. Upside this year isn’t phenomenal, but looking out to next year the upside to fair value is solid. |
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| Ten-Year Chart | ||
 Ancestory.com has been publicly traded since 2009. The stock’s ten-year chart looks great with profits expected to grow around 50% this year. Do note this is the second breakout within a year and most great stocks only get three breakouts during a run. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
12 of 19 |
Long-term this might only be a 15% grower, so I think ACOM will be a “fit the mold” growth stock for the short-term but not the long-term. The databases Ancestory.com has are owned, and who knows what other things the company might buy in the future. Also, the available market is unknown. How many people would sign up? Right now revenues are growing fast and accelerating — so run with it. In my Power Rankings, ACOM is ranked 12th in the 19 stock Growth Portfolio. The stock is ranked 8th in the 10 stock Aggressive Growth Portfolio, replacing Buffalo Wild Wings (BWLD). This timely selection has broken out to new highs and is hot right now. I will keep BWLD in the Growth Portfolio. |
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Aggressive Growth Portfolio
8 of 10 |
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