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When there is a recession ,there is a move that involves consumers seeking pretty good merchandise at decent prices..When you have a keen market plan on top of this thesis,you have a strong surge in revenue..Such has happened with 2 stocks I like right now in this recessionary climate: EZCORP (NASDAQ Ticker symbol:EZPW) and First Cash Financial (NASDAQ:FCFS)..EZCORP saw pawn service fees jump 15% in the quarter and its product sales rose 10%. Also,this past quarter’s profits rose 18% over the prior years’s profit.. First Cash Financial merchandise sales rose 27%..It also expects pawn revenue to be as much as 80% of its revenue this year..

Here is something I like..Both companies are expanding in a region that permeates in this type of free trade..First Cash Financial last year has establish 250 stores in Mexico while acquiring 16 chain of pawn shop stores there..EZCORP has established 40 stores in Mexico while expected 30-35 more stores there this year..To ask why ,you must get to this fact..Operating income grew by more than 120%..So what about currency fluctuations being in a different country..Its operating income was still 87% when you include these fluctuations..Do not invest in the cash advance companies right now like Cash America- (CHS).They expect that these cap rates on payday loans will reduce profits by 15% in this quarter..And about half of its revenue comes from the pawn industry..The new Administration is suppose to put a cap on rates on the payday loan businesses.. But it will have very little effect on its operations..Hence the pawn shops should prosper..Its is trading at 8 times earnings and is barely off its 52 week lows..

In my opinion,EZPW is a strong buy right now and should be held up till the next earnings..

ATW is a buy as of this time..Its an offshore drilling company that expands exploration of oil and gas wells worldwide..An ROE of 32% and PEG of .14 is low enough to consider putting some money as oil prices are stabilizing some..As inventories of oil fields are building and these companies are not pumping as much oil due to the decrease of oil prices –it would seem that the companies that lease contacts to the drillers would hurt them and it does..However,these companies have lease contracts that expand into several years..They can basically prosper a few more quarters out since the lease contracts go out several years when there maybe another peak in oil prices..Its price to book is less than 2..Its is up 15% off its 52 week low so the knife falling has hit a thick rubber glove now..I like Atwood Oceanics-ticker:ATW at these levels..It is a strong buy now in my opinion..

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MSC Industrial Direct Co.-ticker:MSM has also past muster this week as a strong buy in our opinion..It is a tool work company including measurement products,material handling tools,janitorial and plumbing products,power transmission products and electrical supplies.. Its customers range from Government Agencies including General Services and the United States Postal Service.It ranks in the Top 400 Best Big Companies in Forbes Platinum Lists for the 4th straight year ..This ranking is based on 5 year growth as far as growth ,financial strength and profitability..I will broadcast its last quarters earnings like I did with a medical supply in a recent blog..Here’s the last 3 quarter’s average EPS estimate and their actual EPS announced on earnings..4th quarter ’07-.69 estimate–beat-actual EPS .73. 1rst Quarter ’08-EPS average estimate-.78–beat .81..2nd quarter ’08 average EPS estimate-.75- beat…80 actual EPS. And 3rd Quarter ’08 earnings-average EPS estimate .67 EPS–Beat .72 actual EPS reported..MSM is a strong buy held for several quarters in our opinion unless we recommend selling..

Another stock I am noticing is Titan Machinery Inc. Ticker symbol-TITN.It is a company that is expanding organically and through acquisitions.. A true farm dealership based in the Upper Mid-West..The company has a pile of cash–its cash per share is …get this …5.2 per share..This is over 5 times its EPS of 1.01..Its revenue growth for the most recent reported quarter is 61.90% over the year over year quarter..Its is trading at book value..The PEG is .36…On January 6th, this company has been included in NASDAQ Global Select Market–this market has the highest initial standards of any exchange in the world based on financial and liquidity standards..They recently acquired 9 construction dealerships in the Mid West..They have acquired Western Plains Machinery Company on January 23,2009…Western Plains Machinery has consistently produced great revenue and penetrated great market share by concentrating on energy,mining,residential and commercial and infrastructure on the state,local and federal levels..These are located in North Dakota and South Dakota and Nebraska and Iowa..It has too much cash and too small of a company to fail at 9 times earnings in my opinion..Small cap size–which are my favorite stocks for room for growth -its market cap is about 162 million and growing like a baby..It is a strong buy in my opinion…..Dont load all the way up in this market..Put a little money in such stocks is what to do in my opinion ..EZPW, TITN,ATW,and MSM..Watch these stocks..

In my opinion, EZPW, TITN, ATW and MSM are strong buys right now..

Both Rob and Mike currently dont own any shares of EZPW,FCFS,CHS, TITN,ATW or MSM..But both Rob and Mike would possibly like to own EZPW, TITN,ATW and MSM in the near future..Please do your own independent research before you make an investment purchase..See our disclaimer.

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