Top Stock to Buy #3 – Cimatron Ltd. (CIMT)
Small-cap maker of computer-aided design/computer-aided manufacturing (CAD/CAM) software products, Cimatron Ltd. (NASDAQ:CIMT), provides an integrated design-through-manufacturing process for small companies and large corporations worldwide.
The Israeli company recently reported record Q4 earnings and revenues, but management’s most interesting announcement was that “Cimatron is currently exploring new opportunities in the field of additive manufacturing, also known as 3D printing.” Management is confident that their knowledge of various manufacturing processes applied to 3D printing will enhance its overall appeal to customers. The company paid a dividend of over 5% in the last 12 months, but it does not state a firm payment since it is based on quarterly earnings.
The stock dramatically broke from under $5 to over $8 in January, and in mid-February, jumped to almost $13, a result of management’s recent announcements. Since then, it has retraced part of the gain and is currently below our buy under price of $7.25. Buyers should use caution since this is a highly speculative small-cap stock that could be subject to violent swings.