I need to start this off by saying that I just bought Labor Smart (LTNC) in my personal trading account a couple of hours ago. This is a thinly traded stock and so I don’t want anyone to think I’m pumping it. I usually don’t talk about stocks that I have a position in, but this one looks so awesome I can’t help myself.
OMG dudes, something seems irresistibly delicious about this penny stock.
Labor Smart, Inc. (LTNC) is a staffing and outsourcing company. They are a temp agency that provides temporary blue-collar staffing services primarily in the United States. The company supplies general laborers on demand to the light industries, including manufacturing, logistics, and warehousing; and skilled trades people and general laborers to commercial construction industries.
At the end of June, Labor Smart (LTNC) published a press release that they had record revenue for the month ( Labor SMART). The company writes:
Company-wide revenue for June 2014 (ending June 27, 2014) was $2,209,702, a 51.85% increase compared to June 2013 revenue of $1,455,145. Among the 14 branches open one year or more at June 27, 2014 revenue was $1,794,407, a 23.31% increase over last year’s revenue for the same four week period. June 2014 revenue marks the most ever achieved by the company during a four-week month. The company expects revenue to grow exponentially as newer branches ramp up.
If that doesn’t get your blood pumping, Zacks Small Cap Research confirms Labor Smart (LTNC) is the real deal with revenue growth of 70% year over year with an aggressive office expansion agenda. Zacks writes (Backer):
This brings Labor Smart’s footprint to 30 locations. Labor Smart has doubled its footprint this year compared to 2013, when it ended with 15 offices. The company targets a footprint of 100 branches by 2017. The company also continues to grow revenue through acquisitions. In April 2014, management announced that it had acquired Oklahoma based Shirley’s Employment Service… Labor Smart continues to generate solid year-over-year revenue increases, we believe. The company has announced that revenue for the first two months of second quarter 2014 totaled $4.366 million. This represents a 69.1% increase versus $2.582 million registered in the same two months of 2013. We believe this growth has been driven primarily by the company’s ongoing branch expansion and as existing branches mature.
( Labor SMART). In the corporate world, many clients want proof that a company has workers comp insurance before they do business with a temp agency. Most states require employers to purchase an insurance policy to handle their statutory obligations to workers who are injured or made ill due to a workplace exposure.
For example, let’s say a business called ABCD is operating as a sole proprietor. ABCD hires a painter to paint the office. If that painter doesn’t have workers’ compensation insurance on himself and gets hurt working on ABCD premises, he may be able to file a claim against ABCD. The same holds for a roofer, or a cleaning contractor. Anyone you hire to do work for your company could be eligible for workers’ compensation benefits from your company if they get injured on your premises. That’s why many larger companies will contractually require anyone doing work for them to show proof of workers’ compensation insurance. A cleaning service operating as a sole proprietor may not be required by the state to purchase workers’ compensation insurance, but any business hiring that cleaning service would be wise to insist on it (Entrepreneur Magazine's Ultimate Guide to Workers' Compensation Insurance). Especially with blue collar temp jobs like the kind Labor Smart (LTNC) provides where the risk of injury is higher, clients want to know that workers comp insurance is covering the workers that are coming onto their property so I think this is going to help Labor SMART with new business.
Labor Smart (LTNC) Chart
The chart looks like a sweet setup with LTNC coming out of oversold on the RSI and the MACD histogram bars rounding up. The stock did a really nice flush last week and now the volume is starting to pick up on the buy side.