Last week we went 8 up, 5 down and 2 even. LINN.ob holds first place on our “biggest dog” list followed by INFT, DWCH, ARIS.ob and SPNC. For the week, 2007 year-to-date, and since we started this Blog in January 2006 our model portfolio is +2.8%,+5.7% and +22.0% respectively. Since inception we are 14 stocks up and 5 down (3 of which are down 5% or less). The DOW, NASDAQ and the S&P 500 are all up 2% or less so far in 2007.
Parlux and MIVA news last week. Also, we are noticing more interest (share volume) in some of our thinly traded stocls, like CTIG.ob, ARIS.ob, MOBI, DWCH. We are finding it hard to find new value stocks over the past couple of months (although we think we have 1 or 2 that we might write about shortly), other than the ones we already have, so maybe others are finding that ours are looking pretty good relative to the stock universe.
The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).
SPNC-(Buy price $10.65, Valuation $18-$20). Down $.48 to $10.49 last week. Shorts won the battle last week. Prospects are really great for this company. No news. Now down 2% so far. BUY.
QADI-(Buy price $6.93, Valuation $13.69 (was $13.73 and $11.86). Closed at $8.16, down $.01. Trading at 60% of valuation. Earnings due March 15th. No news. Has $1.07 in cash also. Up 18% so far. HOLD.
PDLI-(Buy price $19.31, Valuation > $30)–Closed at $19.58, down $.93. No news. This remains a very volatile stock. Now up only 2%. BUY.
MIVA-(Buy price $3.80, Valuation $7.52 (was $7.38 and $9.10)). MIVA closed at $4.40, up $.08. MIVA announced a “restructuring plan” last week. They expect a $4 million charge in Q1, but will save $10 million a year. Right move. Could be prettying this up for a sale. Now up 16%. HOLD.
DWCH-(Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)). Closed at $3.06, up $.30 for the week. Volume “soared” on Friday to 44,000 shares–big for this stock. With our “double-up” on this one, now down “only” 5%. BUY.
INFT-(Buy price $4.11, Valuation $6.13 (was $6.95, $6.86)). Down $.13 to $3.64 last week. Has $2.64 per share in cash. Price objective $5.50. Now down 11%. HOLD.
MOBI-(Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69). Up $.50 to $7.00 last week. There seems to be some decent accumulation going on here. So we are now trading at 55% of our valuation and cash is 41% of the market cap. Up 5%. BUY.
RITT-(Buy price $1.00, Valuation $3.36 (Was $2.69). Interest seems to have died down a bit last week, but this is still a good one we think. Closed down $.06 at $1.33 last week. Up 33%. HOLD.
PARL-(Buy price $6.65, Valuation $13.77). PARL closed at $7.25, up $1.02 last week. We never got to cast our vote in the Proxy contest–they announced that all the lawsuits were dropped, the CEO resigned and the Board of Directors will be changed significantly. The CEO got a severance deal that will hurt short-term earnings, but we like the trade. Part of the agreement was a deal that Nussdorf would not try to buy the company over the next 2 years–unless he offers at least $11 per share. Not too far from what we think PARL is worth. Wish we had doubled up on this in the $5 range, but at least we are in positive territory again. Up 9%. HOLD.
ARIS.ob-(Buy price $2.06, Valuation $5.28 (was $5.28, $5.21)). Closed at $2.00, unchanged last week. Their OC-Net acquisition looks pricey to us. If ARIS was selling at the multiple of sales they paid, it would be a $5 stock. We are maintaining a HOLD on this one for now, until we see some results. This stock is still illiquid, although we actually traded 14,000 shares on Friday, so price moves are fairly meaningless at this point. Now down 3% so far. Still a Huge valuation gap here.
LINN.ob-(Buy price $.36, Valuation $.62 (was $.66 and before that-$.79)). Closed at $.27, unchanged last week. Still trading at only 44% of our current valuation. Down 25%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).
OPTO.ob-(Buy price $1.25, Valuation $2.89 (was $2.54 and 2.88)). Closed at $1.65, up $.05. Has $.44 in cash per share also. Volume dried up last week, but the price held firm. We think this is a good sign of some favorable events ahead. Maybe we will see north of $2.00 this year. 32% gain so far. HOLD.
AVSO.ob-(Buy price $1.19, Valuation $2.69 (was $3.36, $3.81)). Stock closed at $1.63, up $.15. Now up 37%. No significant news last week. HOLD.
CTIG.ob-(Buy price $.27 ask, Valuation $1.13 (Was $1.05, $.82)). Ask price jumped $.07 to $.35. Closed at $.35. CTIG actually traded 140,000 shares on Friday. Yikes! Not a lot of dollars of course, but at least some interest. Maybe somebody knows what they bought, and likes it. Cash is (was) $.24 per share. Seven weeks ago CTI announced the purchase of Ryder Systems LTD. an international provider of electronic and on-line billing solutions and developer of VoIP business applications. Six weeks ago they filed an 8-K, with details of the financing they got to fund the $11 million purchase–but still no details of what they bought. Now up 30% so far (based on ask price). HOLD until we see what we just bought.
IYXI.ob-(Buy price $1.91, Valuation–over $3.00). Closed up $.09 at $2.26, up 18% to date. Still waiting for the “attractive cash offer” that management says is coming in February. Hopefully it will be attractive by our standards and be at least $3 per share–so we can book at least a 50% gain on this one. Bank debt is now scheduled for repayment by March 31, 2007 and they have arranged financing for their latest acquisition. HOLD.