Skip to main content

Interactive Intelligence - a smart investment?

Looking for a tech stock with a strong BUY rating?

Tuesay night Alert HQ identified a small cap stock that appears poised for a quick gain. Interactive Intelligence (ININ) appeared as a Strong BUY on our list of Swing Trading Signals. The chart follows:

Note how the stock barely touched its 50-day moving average on an intra-day basis and is now bouncing up off its lower Bollinger Band. You can see the strong reaction of the Williams %R indicator as it moves steeply up from an over-sold value. In addition, that 50-day MA is heading nicely upward while the stock has already regained its 20-day MA.

So technically the stock was a good trade today, gaining 3.86%, and showing a potential for a good 5% or 6% more over the next few days and perhaps more over the longer term as long as the overall market doesn't plunge.

What about the fundamentals?

Interactive Intelligence is a small cap stock that is involved in IP telephony. The buzz word best describing the company's business is "unified communication." This is something that Cisco Systems, for example, is also pursuing. Essentially, it means an integration of real-time communication services such as instant messaging (chat), presence information, IP telephony, video conferencing, call control and speech control with non real-time communication services such as unified messaging (integrated voicemail, e-mail, SMS and fax). Interactive Intelligence packages these services for small and mid-sized businesses.

The most recent quarter's results were reasonably good with revenues increasing 7.5% y-o-y and EPS of $0.12 versus only $0.04 in the year ago quarter. The following chart provides a snapshot of the income statement:

Explore more ININ Data on Wikinvest

And this next chart shows that the company is doing very well with respect to cash flow lately:

Explore more ININ Data on Wikinvest

It is noteworthy that the company was able to show growth in the current difficult economic environment; however, this is by no means a cheap company. As an investor you are going to have to pay for the growth this company may offer. It has a sky-high trailing PE of 53, a forward PE of 20 (not too bad), a PEG of 1.28 (kind of high for a value investor), price-to-sales of nearly 2.25 and price-to-book over 5.

Nevertheless, with these kinds of stocks growth is the name of the game and Interactive Intelligence just might be able to deliver.

Disclosure: no position


Popular posts from this blog

Running TradeRadar on Windows 7 and Windows 8

Development of the original TradeRadar Stock Inspector software was begun back in the days before Windows 7 and Windows 8 were available.

As these newer versions of Windows have become more popular, we have heard from some users that they are having problems installing and running TradeRadar on their newer PCs.

The good news is that TradeRadar will work just fine on Windows 7 and Windows 8. All you have to do is adjust the Windows Compatibility Settings to ensure TradeRadar runs as intended.

It is recommended that you can apply Compatibility Settings when running the initial installation; however, it is also possible to apply Compatibility Settings after the program has been installed.

Prior to installation
After downloading the install program, go to the folder where you have stored the TradeRadarStkInsp_7_Setup.exe or TradeRadarStkInsp_7_PRO_Setup.exe executable. Right-click on the executable file and select Properties. Click the Compatibility tab. Adjust the Compatibility mode to …

Alert HQ has moved!

End of an era!

This site was started way back in 2006/2007 to showcase my blog posts and the Alert HQ buy signals and sell signals. Alert HQ grew to include other kinds of stock alerts including Swing Signals, Trend Busters, Trend Leaders, Cash Flow Kings and more.

In the meantime, I built a sister site, and I started using some of the same Alert HQ content over there. As a result, I am discontinuing the Alert HQ data here at

The good news, however, is that all the Alert HQ signals and stock screens are still completely free. In addition, the pages have been enhanced so that you can hover over a stock symbol and a small chart will pop up so you can get a quick look at the stock's recent price action. If you click on a symbol it will take you to a page with plenty of financial and technical analysis information (still free!) as well as a larger chart that you can play with in terms of adding or deleting indicators, moving averages, etc.

Click …

Durable Goods report for Sept just so-so but Computer segment is on fire

The Durable Goods advanced report for September 2011 was released on Wednesday.

I like to dig into the Durable Goods report because it can be useful for seeing how tech in aggregate is performing and how the sector may perform in the future. I always focus on two particular measures: shipments and new orders. Let's see how it played out last month.

Shipments -- 

I generally give less importance to Shipments since this is a backward looking measure reflecting orders that have been confirmed, manufactured and shipped. It's similar to earnings reports -- it's good to know but the data is in the past and we're more interested in the future. The following chart shows how September shipments looked for the overall tech sector:

Results for the overall tech sector were a bit weak but take a look at the next chart which tracks the Computers and related products segment:

Results here were actually quite good and, to make things even better, the previous month was revised upward.