Weekly Wrap New Trades (LOCO, PZZI, HBP)

1:10pm (EST)

Investors have gone crazy for El Pollo Loco (LOCO, $33.01, down $1.06) but I have been recommending a micro-cap stock for a few years now that has even better growth potential.

Better yet, if you missed Loco’s huge initial public offering and the instant riches that may have come, forget about it. I have been recommending this company as a “Strong Buy” in Wall Street gibberish since shares were at $3 a few years ago and when they opened their first concept restaurant.

Shares have made a run to $9 over the past 52 weeks but pulled back earlier this year to form a solid base at $5.75-$6. I have been adding new positions given the recent momentum and before shares surge past double-digits.

It is hard for me to say if Loco’s stock is overvalued or undervalued based on growth but I can tell you this. I have a better valuation play on a new restaurant concept that will be coming to a location near you, soon.

There is no analyst coverage on the stock as Wall Street hasn’t uncovered this little gem. It is my favorite stock to hold over the next 3-5 years as I believe shares can reach $15-$20.

This is a New Trade for the Weekly Wrap that automatically triggered today as shares have cleared $8. I also have another 2 New Trades on familiar names.

New Trades

Buy Pizza Inn Holdings (PZZI, $8.00, up $0.24) Stock Trade

Action: I mentioned if shares cleared $8, I would add another position to the portfolio, automatically, as new highs will likely be in play.

The company could be reporting earnings after the close but I haven’t confirmed this yet as it isn’t in the headlines. Either way, I like new positions at current levels.

Buy Huttig Building Products (HBP, $4.00, up $0.14) Stock Trade

Action: The first trade made 10% back in June. The recent pullback has created a buying opportunity.

Buy Discovery Laboratories (DSCO, $1.68, up $0.04) Stock Trade

Action: I was going to wait for shares to clear $1.75 before starting new positions but have decided to start another one early as a bottom appears to be in.

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Weekly Wrap New Trades (LOCO, PZZI, HBP)

CFTC Disclosure: