Ever notice how analysts start to fall in love with a stock well after the bulk of its move, and well after the company has started to fire on all cylinders? It's just pointless. If you really want to make any money in this game, the time to step in is once you get the subtle hints things are looking up for a company, but before the rest of the market (with the help of analyst upgrades and coverage) starts to take notice. Right now, Ladenburg Thalmann Financial (LTS) fits that bill. At a market cap of $277 million and a share price of $1.60, investment banking and brokerage firm Ladenburg Thalmann is anything but a household name. But, that's the point - most investors and institutions still haven't 'found' this one yet, which means you can get in before they do.... before the train leaves the station. As for the catalyst, that's simple - LTS swung to profitability over the past two quarters, and based on its current revenue/profit trajectory, the profit margin is going to continue widening. Barely anybody else is seeing it though. There's your opportunity. The nearby charts say it all. On an annul basis since 2007 revenues have been growing like crazy, while the loss has been shrinking. I don't think anybody really cared or noticed though, since a loss is still a loss. [The backdrop of the recession and fears of a new one haven't helped on that front.] Take a closer look at the recent quarterly results, however. On a per-share basis that move into the black barely even registers. It's there though, and more important, it's getting better every quarter. No accounting tricks or one-times either. Ladenburg is actually growing its business the old-fashioned way. When's the last time you saw that? Now, I said above that most of the market was still missing the boat on this one, and I meant it. That is changing though; Ladenburg Thalmann Financial is at the early stages of a major move higher, as big buyers are starting to test the waters. Take a look at the nearby chart, and burn it into your memory because you don't see these too often anymore. Since 2008, LTS has given us a near-perfect cup-and-handle pattern. Old-schoolers will know this setup has major bullish consequences most of the time. The only thing a little 'off' about the shape of the chart is the length of the handle - it took a little longer to complete than the cup would imply. That's not going to change the end result though. The bonus clue is the heavy volume we've seen start to pour in. SOMEBODY has been buying this small cap like crazy since March, and these same people held onto it pretty tightly even when the overall market got rocked a few weeks ago. The fact that Ladenburg Thalmann has rallied more than 50% off of the early August low while the market's up only 6% during that time underscores just how serious these bulls are. Why now? Simple... because the market is finally starting to see Ladenburg create results. As for an upside, $2.60 sounds crazy, but it's not as crazy as it sounds after a little math. Generally speaking, the distance between the brim of the cup and the bottom of the cup is also a good target distance for the ensuing breakout effort once the handle is completed. In this case, that distance is right at $1.00. That would put Ladenburg Thalmann shares at $2.60 from its current level. Or if you're more of a fundamental trader, the current price/sales ratio is 1.6, versus a market average of 2.5. Assuming this stock moves to the norm as the company starts to turn a profit on a regular basis, a move to a price/sales ratio of 2.5 would also put LTS around $2.60. Either way you slice it, there's a ton of potential here. Normal trading rules still apply of course, meaning you may want to lock down some profits before we get all the way there, particularly if we see the telltale red flags. We can cross that bridge when we come to it though. We have to be in a trade first if we want to have the sell/hold option. Bottom line - LTS has the makings of a monster small cap trade... great underlying story, strong fiscal progress, and a chart that speaks for itself. And it's the chart that really says the time to get in is now, since bullishness has been brewing for quite some time. Once the brim of the cup at $1.66 breaks, it'll be too late then, as cup-and-handle patterns tend to slingshot a stock once they're complete. You're not going to want to be a bystander on this one. I see Ladenburg Thalmann as one of late-2011's Cinderella stocks.