6/30/2007 Update

Last week we went 6 up and 7 down and 1 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by PARL, BDR, ILOG, ARIS.ob and AVSO.ob. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is -.5%,+24.6% and +43.8% respectively. Since inception we are now 18 stocks up and 6 down (3 of which are down less than 10%).

We were down .5% this past week and are now up 24.6% so far in 2007. The DOW, NASDAQ and the S+P 500 were all up with gains ranging from 0% (S+P 500) to .6% (NASDAQ) last week, and are all now up from 6.0% (S+P 500) to 7.8% (NASDAQ) for the year.

We are now up more than triple all these averages in 2007.

Since inception we have closed out the following positions:

2006-NTCT +44%
2006-ONXS +11% (Buyout offer)
2006-DTLK +41%
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
2007-RITT +62%
2007-MIVA +55%
2007 DTLK +25% (2 weeks)

The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).

For the 10 stocks that we have closed out in 2006 and 2007 the average gain was 35%. We are tired of watching our stocks go up–and then down. So we are planning to take profits a bit sooner than in 2006. We have already closed out 6 positions in 2007 compared to 4 in all of 2006.

Interesting week. News on SPNC, PARL and OPTIO.ob.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $.29 to $11.52 last week.
Pacific Growth Equities issued a “BUY” on SPNC last week. Seems like all the investment firms are lining up to get on the Turbo-Booster bandwagon when it gets approved.
Short interest went up another 10% to almost 4.9 million shares.
We are just waiting for FDA approval. If the TURBO-Booster is approved (no reason to expect it will not be), this should be huge.
Now up 8% so far. HOLD.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $11.27 (was $15.92, $13.69, $13.73 and $11.86)
Closed at $8.30, up $.11.
Our valuation has fallen from $15.92 to $11.27, but if they can hit their guidance for the year, the valuation would be approximately $14.60–78% above the current price. But since they seem to have trouble hitting their numbers–we will hold for now.
No news
Up 20% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $23.30, down $.31.
Our gains continue to slip away on this one, and it makes no sense to us.
Activist investment firm Third Point LLC, owns 11.2 million shares or 9.7% of the company and has more than $200 million invested. They continue to exert pressure on PDL to improve shareholder value. This however, remains a very volatile stock.
If this reaches $30, without a buy-out, we would sell.
Now up 21%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.20 (was $8.32, $7.50, $7.63, $9.31)
Closed at $5.45, down $.41 for the week.
If this gets to $7 we would sell.
No news.
Now up 70%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $8.63 (Was $13.77)
PARL closed at $4.44, down $.11 last week.
Wild ride last week. PARL announced on Wednesday that they had signed a new licensing deal for a Jessica Simpson fragrance. The stock shot up to $5.44 and then slide all the way back and more by the end of the week.
New management needs to get to work on this one fast.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 27%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.01 (was $5.12, $5.88).
Closed at $1.61 up $.05 for the week.
Our valuation has dropped to $4.01. BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up.
No news.
Trading at 40% of our valuation.
Down 12%. HOLD

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.99 (was $20.52)
Closed at $12.30 last week, down $.14.
Double up time here. New buy price based on the double-up will be $12.92.
No news.
Down 9.6%. BUY

Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $18.18
Up $.40 to $9.04 last week
With the insider buying in the last couple of months, we like this stock alot.
Up 3%. HOLD

Mediware (MEDW-Recommended 6/4/2007
Buy Price $6.98, Valuation $13.40
Down $.25 to $7.20 last week.
Penninsula Capital filed a Form 4 last week. Bought another 11,300 shares week at $7.44. Now own 1.67 million shares or over 20% of MEDW. Not sure how they liguidate there stake profitably without a takeover.
Up 3%. BUY

OB-abies (Bulletin Board Listed Stocks)

ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $1.78 (was $2.06 before double up), Valuation $5.34 (was $5.03, $5.28, $5.28, $5.21)
Closed at $1.69, unchanged last week.
Now down 5%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.49 (was $.57, $.62, $.66 and before that $.79)
Closed at $.17, down $.02 last week.
This one has cost us about 3% off our total 2007 performance so far.
Well the militant shareholder group lost the proxy contest. But, apparently Lion management got the message and announced the formation of a “Strategic Review Committee” to explore the sale of the company or parts of the company. They said that they has received “preliminary” and “conditional” indications of interest from parties interested in acquiring “portions of the company”. Hopefully something will happen here. We would double up at this price. New price next week after adjusting for the double-up will be $.23.
Down 53%. BUY on the hopes of a deal here that cuts our losses.

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.28 (was $2.89, $2.89, $2.54 and 2.88)
Closed at $1.44, up $.19 last week.
Has cash of $.44 per share–35% of the market cap.
Last week OPTIO announced they had hired an investment banker to help them review the “Strategic Alternatives” related to their Healthcare software division. In other words, a “for sale” sign just went up. Having been through their SEC filings, there appears to be no disclosure on the sales or operating results for this “division”, so there is no way for us to determine what this could mean from a valuation standpoint. Anyway–good news, we think, and the stock reacted favorably.
Still hoping we will see north of $2.00 this year–but may not happen now unless next quarter rebounds with some decent numbers, or they get a good deal on the Healthcare “division”.
Up 15% so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19,Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $1.15, down $.05 last week.
Trading at 35% of our valuation.
No news.
Now down 3%. BUY.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.29 (Was $1.42, $1.28 $1.13, $1.05, $.82)
Ask price moved up $.05 last week at $.40. Closed at $.35.
This is still trading at only 31% of our latest valuation, but until the VOIP business stops losing money, we are not buyers–yet.
Up 48% based on the ASK price

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6/22/2007 Update–good week for CSI +3.2%

Last week we went 4 up and 6 down and 4 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by PARL, BDR, ILOG, ARIS.ob and BDAY. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +3.2%,+25.1% and +44.3% respectively. Since inception we are now 17 stocks up and 6 down (3 of which are down less than 10%) and 1 even.

We were up 3.2% this past week and are now up 25.1% so far in 2007. The DOW, NASDAQ and the S+P 500 were all down with losses ranging from 1.4% (NASDAQ) to 1.9% (NASDAQ + S+P 500) last week, and are all now up from 6.0% (S+P 500) to 7.4% (DOW) for the year. We are now up more than triple all these averages in 2007.

Since inception we have closed out the following positions:

2006-NTCT +44%
2006-ONXS +11% (Buyout offer)
2006-DTLK +41%
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
2007-RITT +62%
2007-MIVA +55%
2007 DTLK +25% (2 weeks)

The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).

For the 10 stocks that we have closed out in 2006 and 2007 the average gain was 35%. We are tired of watching our stocks go up–and then down. So we are planning to take profits a bit sooner than in 2006. We have already closed out 6 positions in 2007 compared to 4 in all of 2006.

News on SPNC, AVSO.ob. 13D filed on MEDW also.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $1.21 to $11.23 last week.
Nice jump in a bad market–finally. Piper Jaffray issued an “outperform” opinion on SPNC with a measley $13 price target–but it helped. Maybe they are just prepping for the TURBO-booster approval, and will then up their target price.
Short interest is 4.4 million shares. We are just waiting for FDA approval. If the TURBO-Booster is approved (no reason to expect it will not be), this should be huge.
Now up 5% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $11.27 (was $15.92, $13.69, $13.73 and $11.86)
Closed at $8.19, down $.07.
Our valuation has fallen from $15.92 to $11.27, but if they can hit their guidance for the year, the valuation would be approximately $14.60–78% above the current price. But since they seem to have trouble hitting their numbers–we will hold for now.
No news
Up 18% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $23.61, down $1.07.
Our gains are slipping away on this one, and it makes no sense to us.
Activist investment firm Third Point LLC, owns 11.2 million shares or 9.7% of the company and has more than $200 million invested. They continue to exert pressure on PDL to improve shareholder value. This however, remains a very volatile stock.
If this reaches $30, without a buy-out, we would sell.
Now up 22%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.20 (was $8.32, $7.50, $7.63, $9.31)
Closed at $5.86, up $.62 for the week. DWCH did pop over $6 last week, but couldn’t hold there.
If this gets to $7 we would sell.
No news.
Now up 83%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $8.63 (Was $13.77)
PARL closed at $4.55, unchanged last week.
New management needs to get to work on this one fast.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 26%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.01 (was $5.12, $5.88).
Closed at $1.56 down $.04 for the week.
Our valuation has dropped to $4.01. BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up.
No news.
Trading at 40% of our valuation.
Down 15%. HOLD

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.99 (was $20.52)
Closed at $12.44 last week, down $.18.
No news.
Down 9%. BUY

Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $18.18
Down $.40 to $8.51 last week
With the insider buying in the last couple of months, we like this stock alot.
Down 4%. BUY

Mediware (MEDW-Recommended 6/4/2007
Buy Price $6.98, Valuation $13.40
Up $.45 to $7.45 last week.
Penninsula Capital filed a 13D last week. Bought another 222,000 shares over the past few weeks at prices from $6.75 to $7.27. Now own 1.65 million shares or 20.4% of MEDW. They had previously filed 13G’s and have now converted to a 13D–maybe they are going to get more active in trying to get the value up here? Not sure how they liguidate there stake profitably without a takeover.
Up 7%. HOLD

OB-abies (Bulletin Board Listed Stocks)

ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $1.78 (was $2.06 before double up), Valuation $5.34 (was $5.03, $5.28, $5.28, $5.21)
Closed at $1.69, down $.05 last week.
Now down 5%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.49 (was $.57, $.62, $.66 and before that $.79)
Closed at $.19, unchanged last week.
This one has cost us about 3% off our total 2007 performance so far.
One of the Lion co-founders and other shareholders started a proxy contest to get elected to the Board at the shareholders meeting last week (June 20). Obviously they are not happy with the company, or stock performance. With the cost cutting measures announced recently–maybe the proxy contest will liven the stock price up a bit. Would like to at least cut our losses on this one.
No news yet from the meeting or voting.
Down 47%. HOLD until we get some revenue growth and stop losing money (same story as last quarter(s)).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.28 (was $2.89, $2.89, $2.54 and 2.88)
Closed at $1.25, up $.10 last week.
Even with the lousy last quarter, there is still value here.
Has cash of $.44 per share–3%5 of the market cap.
Still hoping we will see north of $2.00 this year–but may not happen now unless next quarter rebounds with some decent numbers.
Dead even on this one so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19,Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $1.20, unchanged last week.
AVSO.ob, announced a $200,000 sale last week and the stock did nothing.
Trading at 37% of our valuation.
No news.
Now up 1%. BUY.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.29 (Was $1.42, $1.28 $1.13, $1.05, $.82)
Ask price unchanged last week at $.37. Closed at $.35.
This is still trading at only 29% of our latest valuation, but until the VOIP business stops losing money, we are not buyers–yet.
Only 5,200 shares traded all of last week.
Up 37% based on the ASK price

6/15/07 Update

Last week we went 7 up and 6 down and 1 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by PARL, BDR, OPTO.ob, ILOG, SPNC and ARIS.ob. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +1.8.0%,+21.9% and +40.6% respectively. Since inception we are now 17 stocks up and 7 down (4 of which are down less than 10%).

We were up 1.8% this past week and are now up 21.9% so far in 2007. The DOW, NASDAQ and the S+P 500 were all up with gains ranging from 1.6% (DOW) to 2.1% (NASDAQ) last week, and are all now up from 8.0% (S+P 500) to 9.5% (DOW) for the year. We are still are up more than double all the averages in 2007.

Since inception we have closed out the following positions:

2006-NTCT +44%
2006-ONXS +11% (Buyout offer)
2006-DTLK +41%
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
2007-RITT +62%
2007-MIVA +55%
2007 DTLK +25% (2 weeks)

The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).

For the 10 stocks that we have closed out in 2006 and 2007 the average gain was 35%. We are tired of watching our stocks go up–and then down. So we are planning to take profits a bit sooner than in 2006. We have already closed out 6 positions in 2007 compared to 4 in all of 2006.

Not much news last week except for OPTO.ob, earnings and the LINN.ob proxy fight.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Down $.27 to $10.02 last week.
Short interest is 4.4 million shares. We are just waiting for FDA approval. If the TURBO-Booster is approved (no reason to expect it will not be), this should be huge. No impact from the 3 analysts presentations last week.
Now down 6% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $11.27 (was $15.92, $13.69, $13.73 and $11.86)
Closed at $8.26, up $.04.
Our valuation has fallen from $15.92 to $11.27, but if they can hit their guidance for the year, the valuation would be approximately $14.60–72% above the current price. But since they seem to have trouble hitting their numbers–we will hold for now.
No news
Up 19% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $24.68, down $.10.
If this reaches $30, without a buy-out, we would sell.
Activist investment firm Third Point LLC, owns 11.2 million shares or 9.7% of the company and has more than $200 million invested. They continue to exert pressure on PDL to improve shareholder value. This however, remains a very volatile stock.
Now up 28%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.20 (was $8.32, $7.50, $7.63, $9.31)
Closed at $5.24, up $.21 for the week.
If this gets to $7 we would sell.
No news.
Now up 63%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $8.63 (Was $13.77)
PARL closed at $4.55, down $.07 last week.
No news. New management needs to get to work on this one fast.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 26%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.01 (was $5.12, $5.88).
Closed at $1.60 up $.04 for the week.
Our valuation has dropped to $4.01. BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up.
No news.
Trading at 40% of our valuation.
Down 13%. HOLD

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.99 (was $20.52)
Closed at $12.62 last week, up $.37.
No news.
Down 7%. BUY

Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $18.18
Up $.26 to $8.91 last week
With the insider buying in the last couple of months, we like this stock alot.
Up 1%. BUY

Mediware (MEDW-Recommended 6/4/2007
Buy Price $6.98, Valuation $13.40
Down $.31 to $7.00 last week.
No news.
Up .3% BUY a little

OB-abies (Bulletin Board Listed Stocks)

ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $1.78 (was $2.06 before double up last week), Valuation $5.34 (was $5.03, $5.28, $5.28, $5.21)
Closed at $1.74, up $.24 last week.
Now down 2%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.49 (was $.57, $.62, $.66 and before that-$.79)
Closed at $.19, up $.04 last week.
This one has cost us about 3% off our total 2007 performance so far.
One of the Lion co-founders and other shareholders have started a proxy contest to get elected to the Board at the shareholders meeting next week (June 20). Obviously they are not happy with the company, or stock performance. With the cost cutting measures announced last week–maybe the proxy contest will liven the stock price up a bit. Would like to at least cut our losses on this one.
We will give LION another quarter to see if they can turn things around.
Down 47%. HOLD until we get some revenue growth and stop losing money (same story as last quarter(s)).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, NEW Valuation $2.28 (was $2.89, $2.89, $2.54 and 2.88)
Closed at $1.15, down $.19 last week.
The disappointing earnings report last week knocked OPTO down below our buy price.
Has cash of $.44 per share–38% of the market cap.
Still hoping we will see north of $2.00 this year–but may not happen now unless next quarter rebounds with some decent numbers.
Down 8% so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19,Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $1.20, down $.07.
Trading at 37% of our valuation.
No news.
Now up 1%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.29 (Was $1.42, $1.28 $1.13, $1.05, $.82)
Ask price unchanged last week at $.37. Closed at $.35.
This is still trading at only 29% of our latest valuation, but until the VOIP business stops losing money, we are not buyers–yet.
Only 400 shares traded all of last week.
Up 37% based on the ASK price

Optio (OPTO.ob)

OPTO reported Q1 (4/30/07) reslts yesterday.
Stock fell $.17 to $1.15 per share.

Not what we would have liked. Revenues fell 9% from $6.9 million to $6.3 million. They lost $1.17 million compared to a loss of $54,000 last year. No good reasons for the miss, other than sales were bad essentially and they are working on it. They continue to waste cash buying back shares (like there is too much float–although the bad news did flush out 368,000 shares, more than 10X normal volume).

The bottom line is that our valuation has fallen from $2.89 to $2.28. Cash per share is now $.44 compared to $.47.

This is a HOLD for now. Still trading at about 50% of our valuation and cash is now 38% of the market cap.

6/9/2007 Update

Last week we went 5 up and 8 down and 1 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by ARIS.ob, PARL, BDR, ILOG, SPNC and BDAY. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is -3.3%,+20.1% and +38.6% respectively. Since inception we are now 17 stocks up and 7 down (3 of which are down less than 10%).

We were down 3.3% this past week and are now up 20.1% so far in 2007. The DOW, NASDAQ and the S+P 500 were all down with losses ranging from 1.5% (NASDAQ) to 1.9% (S+P 500) last week, and are all now up from 6.3% (S+P 500) to 7.7% (DOW) for the year. We are still are up more than double the averages in 2007 and triple the NASDAQ and S+P 500.

Since inception we have closed out the following positions:

2006-NTCT +44%
2006-ONXS +11% (Buyout offer)
2006-DTLK +41%
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
2007-RITT +62%
2007-MIVA +55%
2007 DTLK +25% (2 weeks)

The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).

For the 10 stocks that we have closed out in 2006 and 2007 the average gain was 35%. We are tired of watching our stocks go up–and then down. So we are planning to take profits a bit sooner than in 2006. We have already closed out 6 positions in 2007 compared to 4 in all of 2006.

Not much news last week except for ARIS.ob, earnings.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $.20 to $10.29 last week.
Short interest is 4.4 million shares. We are just waiting for FDA approval. If the TURBO-Booster is approved (no reason to expect it will not be), this should be huge. SPNC announced 4 analyst presentations in June–2 next week.
Now down 3% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $11.27 (was $15.92, $13.69, $13.73 and $11.86)
Closed at $8.22, down $.07.
Our valuation has fallen from $15.92 to $11.27, but if they can hit their guidance for the year, the valuation would be approximately $14.60–72% above the current price. But since they seem to have trouble hitting their numbers–we will hold for now.
No news
Up 19% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $24.78, down a whopping $2.82.
Wachovia downgrades PDLI last week. Said there were no short-term catalysts. How about Third Point?
If this reaches $30, without a buy-out, we would sell.
Activist investment firm Third Point LLC, owns 11.2 million shares or 9.7% of the company and has more than $200 million invested. They continue to exert pressure on PDL to improve shareholder value. This however, remains a very volatile stock.
Now up 28%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.20 (was $8.32, $7.50, $7.63, $9.31)
Closed at $5.03, down $.21 for the week.
If this gets to $7 we would sell.
No news.
Now up 57%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $8.63 (Was $13.77)
PARL closed at $4.62, up $.13 last week.
No news. New management needs to get to work on this one fast.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 24%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.01 (was $5.12, $5.88).
Closed at $1.56 down $.09 for the week.
Our valuation has dropped to $4.01. BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up.
No news.
Trading at 39% of our valuation.
Down 15%. HOLD

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.99 (was $20.52)
Closed at $12.25 last week, down $.51.
No news.
Down 9.9%. BUY

Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $18.18
Down $.21 to $8.65 last week
With the insider buying in the last couple of months, we like this stock alot.
Down 2%. BUY

Mediware (MEDW-Recommended 6/4/2007
Buy Price $6.98, Valuation $13.40
Up $.33 to $7.31 last week.
No news.
Up 5% HOLD/BUY a little

OB-abies (Bulletin Board Listed Stocks)

ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $2.06, NEW Valuation $5.34 (was $5.03, $5.28, $5.28, $5.21)
Closed at $1.50, down $.40 last week.
Q3 earnings were announced on Thursday. Apparently they disappointed shareholders who dumped a huge (145,00) number of shares last week. Sales were up 15% to $4.1 million, but they lost $205,000 versus earning about $465,000 last year. OC-Net integration costs hurt earnings, but the company did not say by how much. Gross margins continued to be above 80%
The good news is that there are actually shares to be bought and our valuation moved UP to $5.34 per share and ARI is now trading at 28% of our valuation.
This is now a double up at $1.50. New avg. cost will be $1.78 next week.
Now down 27%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.49 (was $.57, $.62, $.66 and before that-$.79)
Closed at $.15, even last week.
This one has cost us 3.5% off our total 2007 performance so far.
We will give LION another quarter to see if they can turn things around.
Down 58%. HOLD until we get some revenue growth and stop losing money (same story as last quarter(s)).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.89, $2.54 and 2.88)
Closed at $1.34, up $.02 last week.
Has cash of $.47 per share–35% of the market cap.
Still hoping we will see north of $2.00 this year.
No news.
7% gain so far. BUY.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19,Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $1.27, up $.06.
Trading at 39% of our valuation.
No news.
Now up 6%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.29 (Was $1.42, $1.28 $1.13, $1.05, $.82)
Ask price dropped $.01 last week at $.37. Closed at $.35.
This is still trading at only 29% of our latest valuation, but until the VOIP business stops losing money, we are not buyers–yet/
Up 37% based on the ASK price

Mediware Information Systems, Inc. (NASDAQ-MEDW)

Mediware Information Systems, Inc. (NASDAQ–MEDW)
Valuation-$13.40
Price June 1, 2007-$6.98

I have been watching MEDW for a while, and the price has now fallen into our buying range.

Q3 results (3/31/2007) showed an 11% sales increase and $831,000 net income–$.10 per share (fully taxed and up from the prior year of $.08). There a bit over 8.4 million shares outstanding and they reported 73% gross margins and have $2.53 a share in cash (36% of market cap). There has been a lot of selling pressure of late, as the price has dropped from $8.60 at the end of April. Possibly a fund getting out. We just don’t see the reason for this drop.

With over $2.50 a share in cash, and these margins—and making money, we think this is a good bet.

We bought some this week at $6.99 and $6.95. Average daily trading volume has been nearly 30,000 shares.

We think anything under $7.00 is a good price.

MEDW is trading at 52% of our valuation.

About Mediware Information Systems, Inc.
Mediware delivers powerful software solutions that encapsulate patient care instructions, reinforce patient safety practices and improve efficiencies to lower costs. Mediware targets three primary areas of patient care — Medication Management, Perioperative Management and Blood Management (transfusion, inventory and donor practices) — with specialized solutions that are proven in more than 1,000 client installations. Mediware’s customers include prestigious hospitals, clinics, correctional institutions, blood centers and other public and private health care institutions throughout the world. For more information about Mediware products and services, visit our web site at http://www.mediware.com.

6/2/2007 Update-up 23.4% this year

Last week we went 10 up and 3 down and 3 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by PARL, BDR, ARIS.ob, ILOG and SPNC. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +4.1%,+23.4% and +42.4% respectively. Since inception we are now 17 stocks up and 6 down (4 of which are down less than 10%).

We were up 4.1% this past week and are now up 23.4% so far in 2007. The DOW, NASDAQ and the S+P 500 were all up with gains ranging from 1.2% (DOW) to up 2.2% (NASDAQ) last week, and are all now up from 8.2% (NASDAQ) to 9.7% (DOW) for the year. We are still are up more than double the averages in 2007.

Since inception we have closed out the following positions:

2006-NTCT +44%
2006-ONXS +11% (Buyout offer)
2006-DTLK +41%
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
2007-RITT +62%
2007-MIVA +55%
2007 DTLK +25% (2 weeks)

The model portfolio assumes $10,000 invested in each stock, less $10 commission each way (TD Ameritrade rate).

For the 10 stocks that we have closed out in 2006 and 2007 the average gain was 35%. We are tired of watching our stocks go up–and then down. So we are planning to take profits a bit sooner than in 2006. We have already closed out 6 positions in 2007 compared to 4 in all of 2006.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $.14 to $10.09 last week.
Short interest is 4.4 million shares. No signiciant news. We are just waiting for FDA approval. If the TURBO-Booster is approved (no reason to expect it will not be), this should be huge.
Now down 5% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $11.27 (was $15.92, $13.69, $13.73 and $11.86)
Closed at $8.29, up $.27.
We should have sold this at $10. Next time.
Our valuation has fallen from $15.92 to $11.27, but if they can hit their guidance for the year, the valuation would be approximately $14.60–72% above the current price. But since they seem to have trouble hitting their numbers–we will hold for now.
Up 20% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $27.60, up $.14.
The letter war continues between Third Point and PDLI management and Board. Price continues to increase.
If this reaches $30, without a buy-out, we would sell.
Activist investment firm Third Point LLC, owns 11.2 million shares or 9.7% of the company and has more than $200 million invested. They continue to exert pressure on PDL to improve shareholder value. This however, remains a very volatile stock.
Now up 43%. HOLD.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, Valuation $9.00 (was $7.37, $7.52, $7.38 and $9.10)
SOLD last week at $5.90 for a 55% gain.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.20 (was $8.32, $7.50, $7.63, $9.31)
Closed at $5.24, up $.43 for the week.
If this gets to $7 we would sell.
No news.
Now up 63%. HOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $1.95 (Was $3.36, $2.69)
SOLD last week at $1.62 for a 62% gain.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $8.63 (Was $13.77)
PARL closed at $4.49, up $.08 last week.
No news. New management needs to get to work on this one fast.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 27%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.01 (was $5.12, $5.88).
Closed at $1.65 up $.02 for the week.
Our valuation has dropped to $4.01. BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up.
No news.
Trading at 41% of our valuation.
Down 10%. HOLD

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.99 (was $20.52)
Closed at $12.76 last week, down $.17.
No news.
Down 6%. BUY

Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $18.18
Up $.16 to $8.86 last week
With the insider buying in the last couple of months, we like this stock alot.
Up 1%. BUY

Datalink (DTLK-recommended 5/14/2007
Buy Price $5.20, Valuation $8.70
SOLD last week at $6.50 for a 25% gain in 2weeks.

OB-abies (Bulletin Board Listed Stocks)

ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $2.06, Valuation $5.03 (was $5.28, $5.28, $5.21)
Closed at $1.90, up $.10 last week.
Q3 earnings out on June 7th, after the close.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now down 8%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.49 (was $.57, $.62, $.66 and before that-$.79)
Closed at $.15, even last week.
Our valuation has dropped 14% to $.49.
This one has cost us 3.5% off our total 2007 performance so far.
Lion announced some cost cutting last week–25% of staff and consolidating 2 offices. About time. Say they want to reach profitability ASAP.
We will give LION another quarter to see if they can turn things around.
Down 58%. HOLD until we get some revenue growth and stop losing money (same story as last quarter(s)).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.89, $2.54 and 2.88)
Closed at $1.32, unchanged last week.
Has cash of $.47 per share–35% of the market cap.
Still hoping we will see north of $2.00 this year.
No news.
6% gain so far. BUY.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19,Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $1.21, down $.04.
Trading at 36% of our valuation.
Announced a traing partnership last week. Yawn, need some performance here to get attention. Bought some more last week at $1.21.
Now up 2%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, NEW Valuation $1.29 (Was $1.42, $1.28 $1.13, $1.05, $.82)
Ask price was unchanged last week at $.38. Closed at $.35.
Volume was only 10,000 shares last week (again).
This is still trading at only 30% of our latest valuation, but until the VOIP business stops losing money, we are not buyers–yet/
Up 41% based on the ASK price