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-ONXS +11% (Buyout offer)
2006-CAW +21% (Buyout offer)
2007-IYXI.ob +44% (Buyout offer)
2007-MOBI +47% (Buyout offer)
2007-INFT +11% (Buyout offer)
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.
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.
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.
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.
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.
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