TALX Corp. provides employee self-service solutions using interactive Web, interactive voice response, computer telephony integration software and services to government agencies & Fortune 1000 companies. For the 6 months ended 9/00, revenues increased 20% to $20.3M. Net income from cont. ops. rose 63% to $2M. Results reflect increased number of employment records and related transaction volumes, increased margins, and higher interest income.

December 17, 2000

The TALX Corporation (TALX) is an application service provider (ASP) that designs and implements interactive communications solutions for human resources, payroll, and employee benefits. All of the company's services are delivered through the TALX ASP Center and use leading edge technologies such as interactive web and interactive voice response systems. Such technologies have kept the company ahead of the competition and has kept their stock price soaring. On November 11th, shareholders authorized the company's first stock split. The 3:2 split will be authorized for shareholders of record on December 8th, with a payable date of January 19, 2001. Even more exciting, shares may have just signaled that they're ready for additional gains by breaking out to new highs on Friday. This week's advance, which broke above a two-week consolidation range, came on strong volume (110 thousand shares traded) and made a new closing high at $38. We'll look for $38.25 (intraday high) to present our initial opposition. As far as support for the stock goes, the previous high of $33.81 should help to bolster support at $34. We are placing our stop just below support at $33.25, to protect against a meltdown. Look for buying opportunities if good volume (100 thousand shares or more) follows a sharp bounce from support or an advance through resistance.

Picked on December 17th @ $38.00
Change since picked 0.00
Stop Loss @ $33.25

January 4, 2001

TALX’s Work Number solution represents a fast and accurate way to verify both employment and salary information in one telephone call. This accelerates the underwriting process and reduces the total cost of verification. The broad scope of ASP applications has helped the company to grow its annual earnings by an incredible 120% pace. Now that’s growth! For our play, the stock gave us all a quick scare yesterday, as shares fell to an intraday low of $34.44. However, heavy buying late in the day created a sharp recovery from this low, which set the stage for today’s advance. Strong volume of 191,500 shares accompanied today’s $1.38 run, which tells us that more near-term gains should follow. With that said, we’ll look for the stock to now face initial resistance at $38, braced by the 20-dma of $38.56. Further up, look for resistance to be heavy at the $40 mark, bolstered by a series of intraday highs. Quick advances above either of these levels when followed by volume of 100,000 shares or better, will signal our entry points. For support, look to the $35 mark for a light support base. Secondary support should be at Wednesday’s intra-day low of $34.44, bolstered by the 30-dma of $34.49. Confirm sharp bounces off either of these levels with good mid-day volume of 50,000 shares prior to opening plays. Continue to keep stops set at $33.25 to limit losses.

Picked on December 17th @ $38.00
Change since picked –0.25
Stop Loss @ $33.25

January 2, 2001

Shares of the leading application service provider (ASP) for employee service, TALX, announced today an increase in the W-2 service contracts for tax filings. Recently signed contracts include large corporations like Best Buy, Borders Group and The Gap. TALX’s ASP technology provides end-to-end solutions that automate all aspects of the W-2 process from printing and distributing initial statements to facilitating corrections and reissuing statements. On Tuesday, shares gapped through support at $40 and retested previous lows near $37.50. Heavy losses in the NASDAQ Composite Index (COMPX), which fell 179 points or 7.23%, likely contributed to the fall. Should we see more selling during the week, look for some support to come at today’s intra-day low of $37.38. A stronger base should arise at $36, which is strengthened by previous lows and the 20-dma of $35.84. Confirm sharp bounces of either of these levels with good mid-day volume of 50,000 shares or better prior to opening plays. We’ll keep our stops set at $33.25 to protect our backside. However, should we get an upside reversal, we’ll look for key resistance to come at the $40 mark. A sharp advance through this level, when followed by good daily volume of 100,000 shares or more could send the stock to a tougher challenge at the all time high of $42.13. Support and resistance will guide our entries and exits ahead of the payable date of January 19.

Picked on December 17th @ $38.00
Change since picked –0.19
Stop Loss @ $33.25

December 31, 2000

The trend toward outsourcing human resource applications has fueled growth at TALX’s application line of business. Within this division, the company’s revenues for fiscal 2000 grew by 56% and hold a healthy backlog of orders going into 2001. Application services play a key role in TALX’s solutions for Fortune 500 companies. On Friday, TALX shares pulled back from yesterday’s advance and retested support at $40. An intraday fall sent the stock below this level to $39.25, but shares mustered a late day rally to close at $40. Braced by several previous highs at this level, we feel that the $40 mark could be an important base for the next leg up. If shares can bounce sharply off this level on good mid-day volume of 50,000 shares or better, then look for the stock to face its fist challenge at the all time high of $42.13. Further up, TALX will need to confront tougher opposition at $45 and $50. Advances above these resistance levels will present us with good entry points, should good volume of 100,000 shares or more accompany the run. However, if TALX can’t hold support at $40, then shares may meet up with a short-term pullback. An overbought reading in the stochastic confirms this possibility. If this does take place, then look for secondary support at $39 to be reinforced by previous highs and the 10-dma of $38.76. A decline to $36, which does seem less likely, will be faced with firm support from previous bottoms and the 20-dma of $35.44. We’ll set stops just below this level at $33.25. Let support and resistance determine entries and exits ahead of the payable date of 1/19.

Picked on December 17th @ $38.00
Change since picked +2.00
Stop Loss @ $33.25