We were off last week. So all the data is for the past 2 weeks.
Last 2 weeks we went 8 up, 6 down and 1 even. Our biggest DOGS are: LINN.ob, BDR, PARL, and AVSO.ob, all down 10% or more. For the 2 weeks, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is -1.7%,+11% and +28.0% respectively. Since inception we are now 19 stocks up and 7 down(3 of which are down less than 10%).
We were down 1.7% this past 2 weeks and are now up 11.0% so far in 2007. The DOW, NASDAQ and the S+P 500 were all up, with gains ranging from 4.1% (NASDAQ) to 5.4% (DOW) last week. The Dow is up 10.9%, NASDAQ is up 10.6 and the S+P 500 is up 7.5% for the year.
Our OB-abies contine to lag, and LINN.ob is killing us. BDR and LINN.ob are the weakest companies fundamentally and we are looking for an economic exit on these two. The rest of our stocks are looking good, in our opinion.
We are now up about the same as the DOW and NASDAQ and about 1.5 times the S+P 500 averages in 2007. The Russell 3000 and the Wilshire 5000 are both up between 7.3% and 7.6% for the year.
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)
2007-PDLI + 3% (Waited too long to sell)
The model portfolio assumes $10,000 invested in each stock (unless we double-up–then it is $20,000), less $10 commission each way (TD Ameritrade rate).
For the 11 stocks that we have closed out in 2006 and 2007 the average gain was 33%. 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 7 positions in 2007 compared to 4 in all of 2006.
OPTIO earnings. Not much other news to spreak of.
Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Down $.43 to $14.10.
Guidance has not been updated yet for the TURBO Booster.
Looks like the shorts are still insisting on playing with this.
Now up 32% so far. HOLD.
QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93,Valuation $12.84 (was $11.27, $15.92, $13.69, $13.73 and $11.86)
Closed at $8.40, up $.77.
Up 21% so far. HOLD.
DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $9.28 (was $9.20, $8.32, $7.50, $7.63, $9.31)
Closed at $4.60, up $.02.
Not much action here lately. Hopefully this quarter results will build on the last one and DWCH will get noticed again.
DWCH is now trading at 49% of our valuation.
Now up 46%. BUY.
Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $4.78 (was $6.12 before another $10,000 added, $6.65 before double up), Valuation $9.20 (Was $8.63, $13.77)
PARL closed at $3.86, up $.11.
Another decent quarter and we should be back in the black on this one.
New management needs to keep moving this company is the right direction.
The new management has 2.2 million reasons to make this stock go up. Glenn Nussdorf paid $6 for his shares.
Down 19%. BUY.
Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $4.31 (was $4.01, $5.12, $5.88).
Closed at $1.22 down $.04.
BDR is still cheap in our opinion, but they need a decent quarter to get this stock moving up. As we mentioned above, we are looking to get back to even on this one and get out, even though the valuation is compelling.
Trading at 28% of our valuation.
Down 33%. HOLD
ILOG SA (ILOG-recommended 3/26/2007)
Buy price $12.08 (was $12.92 before another $10,000 added, $13.60 before double-up), Valuation $23.22 (was $20.99, $20.52)
Closed at $11.65 up $.31.
For FY2008 they are projecting another 20% increase in sales and a tripling of operating income. They still have $2.95 a share in cash.
Down 4%. BUY
Celebrate Express (BDAY-recommended 4/17/2007
Buy Price $8.82, Valuation $17.85 (Was $18.18)
Up $.15 to $9.34.
The insider buying seems to have stopped for a while.
With the insider buying and discount to our valuation, we like this stock alot.
Earnings out 9/28 before the market opens.
Up 6%. BUY on dips below $9.00.
Mediware (MEDW-Recommended 6/4/2007
Buy Price $6.67, (was $6.98 after double up ($10,000 added) NEW Valuation $12.89 (was $13.40)
Down $.94 to $6.39.
Has cash of $2.70 a share (37% of its market cap.) and is trading at 57% of our valuation. We still like this one.
Penninsula Capital owns 1.67 million shares or over 20% of MEDW. Not sure how they liguidate there stake profitably without a takeover
Down 4%. BUY
Cimatron (CIMT-Recommended 8/12/2007
Buy Price $2.12, Valuation $7.53
Up $.03 to $2.15.
Up 1%. BUY
Candela Corp. (CLZR-Recommended 8/30/2007
Buy Price $7.26, Valuation $11.51
Up $.86 to $8.07.
Presenting at the UBS conference on 9/27, but no other significant news.
Up 11%. HOLD
OB-abies (Bulletin Board Listed Stocks)
LINN.ob has chopped our 2007 gains by 14% all by itself.
ARI Networks (ARIS.ob-Recommended 8/19/2006)
Buy price $1.61 (Was $1.78 before another $10,000 added, was $2.06 before double up), Valuation $5.34 (was $5.03, $5.28, $5.28, $5.21)
Closed at $1.50, up $.05.
Now down 7%. BUY. Still a Huge valuation gap here.
Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.23 (was $.36 before double-up on investment), Valuation $.29 (was $.49, $.57, $.62, $.66 and before that $.79)
Closed at $.10, up $.02.
LINN continues to decline. Our valuation has dropped to $.29 as there business continues to deteriorate. They need to sell this thing quickly if they can.
This “stinker” has chopped over 10% off our 2007 performance all by itself.
Lion management has 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.
Down 57%. Hold.
OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, NEW Valuation $2.34 (was $2.28, $2.89, $2.89, $2.54 and 2.88)
Closed at $1.40, down $.12.
Announced earnings 2 weeks ago. Not great, but our valuation moved up to $2.34. They are still losing money, and cash is declining.
Has cash of $.38 per share–27% of the market cap.
In late June, 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 has gone 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.
It has been over 2 months now since their announcement–We would expect to hear an update soon. They said in their latest earnings release that their healthcare business exceeded their goals. They better gat a good price for this.
Still hoping we will see north of $2.00 this year–but may not happen now unless next quarter rebounds with some decent profit numbers, or they get a good deal on the Healthcare “division”.
Up 12% so far. HOLD.
Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $.99 (was $1.19 before double up ($10,000 added), Valuation $3.25 (was $3.29 $2.69, $3.36, $3.81)
Stock closed at $.85, down $.05.
Earnings on 9/28 before the market opens.
AVSO announced a restructuring in late July that is expected to save more than $2.5 million annually. They also narrowed their revenue guidance to between $50 and $51 million for 2007. They expect to lose money in Q4 (partly due to $500k in severance charges), but are projecting “significantly” better margins over recent results. They do not expect to lose money in FY 2008. We will wait to see this quarters results and any impact on our valuation.
Trading at 26% of our valuation. Just too CHEAP.
Now down 14%. BUY.
CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.38 (Was $1.29, $1.42, $1.28 $1.13, $1.05, $.82)
Ask price fell $.07 to $.32. Closed at $.32.
Little interest in this stock. Management needs to get some going.
This is still trading at only 25% of our latest valuation.
Up 19% based on the ASK price. BUY