The Secret To Gains Of 514% With Penny Stocks

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Where Can You Turn $300 Into $1.3 Million Right Now?

Our own small-company specialist, Robert Morris, has found a way to 'sniff out' tiny penny stocks on the verge of a major breakout.  And the timing for this has never been better.

You see, the system takes advantage of an obscure SEC regulation that sends penny stock prices through the roof.

We've seen some stocks gain 852%... 5,450%... even 17,496% in no time flat.

Click here for the details...
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They publish a free magazine.  It’s a valuable resource for anyone looking to buy a new home or rent an apartment.  I know you’ve seen the magazine stands at your local grocery store.  You might have even used one recently.

Apartment Guide and New Home Guide are published by PRIMEDIA (PRM), the stock we’ve been discussing.

The business is simple.  They get all the local apartments or new home developers to pay for advertising.  Then they give the magazines away for free.  It’s a very effective strategy.  Just look at their distribution numbers.

Last year PRIMEDIA distributed more than 39 million guides to over 60,000 locations throughout the United States.

Why are they so successful?

Because everyone is constantly moving.  Some are buying new homes. Some people are changing jobs.  Others might be in foreclosure. Whatever the reason, people are always moving.  The US Census Bureau estimates 40 million people move every year!

That’s a lot of free magazines to give away.

As such, the financial numbers look great.  Right before my recommendation, the company posted revenue of more than $76 million. They even dropped $1.9 million to the bottom line… pure profit. Management was aggressively cutting costs.

Now, the top line didn’t look like it would grow much… after all, their customers are in the housing industry.  However, they were looking very successful in a horrible economic environment.  Imagine what they could do when the economy improved.

That’s not all…

I also looked at their shareholder base.  It turns out PRIMEDIA was put together by Kohlberg, Kravis & Roberts (KKR), one of the largest private equity firms in the world.  KKR owns just over 58% of the company and has two board seats.  As I told my subscribers, “It’s like having an activist shareholder on the board, a good sign for investors.”

Our analysis was dead on.  Just look at the chart.


As you can see, the analysis of this situation was spot-on.  Our peak gain was over 514%.

Picking winners might seem easy.  But in reality, it’s a lot tougher than it looks.  Especially in the penny stock market.  But with solid research and a little courage, you can find some really big winners that others completely overlook.

If you’d like some help finding the next big thing in the penny stock market, be sure to check out my Penny Stock Breakouts service.  We’ve got a few ideas we think could do even better than PRIMEDIA…

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