We had a 5.7% gain last week, helping us almost catch up to NASDAQ for the year. We are now up 11.5% for the year. The DOW was up 1.0% and is now up 7.4% on the year and NASDAQ was up .5% and now stands at up 12.8% for the year.

DAEG earnings last week.

Some of our stocks are just stupid cheap—compared to their net cash on hand divided by their stock price.

Check this list:

UNTD	41%
CCUR	37%
SIGM	52%
MRVC	26%
SYNC	47%
CTIG	50%

ATEC, PRSS, CAFE, MRVC, DAEG, SYNC, SIGM, CCUR, BLIN, EXTR, DXM and UNTD can still be bought.

Last week we went 8 stocks up and 6 down. Since inception we are now 67 stocks up and 20 down for a 77% winning percentage (80% is our target win %).  Of our closed-out positions 60 have been winners and 13 have been losers for an 82% win percentage and a 35% average net gain per position.

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).

Alphatec Holdings, Inc. (NASDAQ-ATEC)-Recommended 9/2/2014)

Buy Price $1.56

Valuation $2.95 (Was, $3.00)

Closed down $.02 at $1.38

ATEC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $51 million compared to $50.2 million last year. Non-GAAP, EPS was a loss of $.01 compared to a profit of $.01 last year. More significantly, EBITDA was up 22% from $6.7 to $8.2 million. Our valuation came in at $2.95 compared to the previous $3.00. ATEC is trading at 47% of our valuation.

Down 12% BUY

CafePress, Inc.  Inc. (NASDAQ-PRSS)-Recommended 5/19/2014)

Buy Price $5.40

Valuation $11.17 (Was $12.51, $11.27)

Closed down $.12 at $2.19

PRSS announced Q3 2014 (September 30, 2014) earnings on November 13^th, 2014. Revenues were $48.6 million, down slightly from $50.4 million last year. They lost $2.8 million versus a $1.0 million loss last year. Our new valuation was $11.17 down from $12.51 last quarter. PRSS is trading at 20% of our valuation. This is obviously a work-in-progress for a while. We are betting that the new (old) management can right the ship and get revenues and earnings growing again. Only mention of “strategic alternatives” was that they apparently inked a deal to sell InvitationBox” but with no other details. Shares closed at $2.97 on 11/13. This is still a BUY.

Lloyd Miller filed a Form 13G on October 24, 2014 disclosing a 5.1% (887,000 shares) stake in PRSS..

Down 60% BUY

Extreme Networks, Inc.  Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $3.43 (was $3.95 before we added another $10,000)

Valuation $8.24, (Was $9.68, $8.52)

Closed down $.07 at $3.68

EXTR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $137.1 million, Non-GAAP EPS was a loss of $.01. Net cash was $2.92 per share. Overall an OK quarter. Our valuation came in a little better than expected after their preannounced revenue miss for the quarter, at $8.24. Guidance for next quarter is revenue of about $140 to $150 million and Non-GAAP EPS of $.03 to $.07 a share.

The CEO bought 10,000 shares on 8/29 at $5.33 a share.

UP 7% BUY

United Online Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $10.28

Valuation $33.50 (Was $35.84, $32.35, $27.86)

Closed up $.44 at $13.19

UNTD announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $52.9 million compared to $56.2 million last year. Adjusted OIBDA (the term they use-Operating income before depreciation and amortization) was $10.2 million compared to $10 million last year. Cash rose to $5.38 a share. Our valuation fell a bit to $33.50—still well above the current trading price. They are projecting $215-218 million in revenue for the year and $32-$35 million in OIBDA for the year.

UNTD is trading at about 39% of our valuation and cash is 41% of the market cap ($5.38 a share versus $4.98 a share last quarter.

Up 28% BUY

Synacor Inc. (NASDAQ-SYNC)-Recommended 12/17/2013)

Buy Price $2.56

Valuation $5.58 (Was $5.21, $5.44, $6.67, $6.39)’

Closed up $.04 at $1.69

SYNC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $26.2 million down slightly from $26.5 million the prior year.  They had a Non-GAAP loss of about $1.4 million compared to a loss of $.4 million last year. SYNC’s valuation rose from last quarter to $5.58, but was still lower than last years $6.01.

JEC and Ratio Capital seem to have been quiet lately.

Down 34%. BUY

Dex Media Inc. (NASDAQ-DXM)-Recommended 5/10/2013)

Buy Price $15.14

Valuation $31.00 (Was $34.00, $37.98, $34.36, $31.50, $24.25)

Closed down $.30 at $8.18

DXM announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $452 million, down from $474 million last quarter and adjusted EBITDA was $167 million down from 174 million last quarter. Overall an OK quarter. Our valuation fell a bit to $31 down from $34  last quarter. They have paid off $319 million of net debt over the last twelve months and total net debt stands at $2.3 billion.

Looking back to 2012 at their projections before the merger it looks like they will miss their 2014 projections for revenue and adjusted EBITDA by 10-15%, but will beat their projected debt reduction target by over $100 million. The faster they get rid of the huge debt, the better as it is the primary risk factor affecting the stock price in our opinion.

DXM is trading at about 27% of our valuation, but due to the high debt level and small number of shares outstanding, relatively small changes in DXM’s results can cause large swings in our valuation.

Down 46% BUY

Daegis Inc. (NASDAQ-DAEG)-Recommended 11/30/2012)

Buy Price $1.09 (Was $1.20 before we doubled up)

Valuation $2.83 (Was $2.85,s $3.39, $3.25, $3.42, $4.64, $4.86, $4.00)

Closed up $.23 at $.83

Second quarter (10/31/2014) earnings announced on November 20^th.

Revenues were $6.7 million down from $7.7 million last year and flat with $6.7 million last quarter. They broke-even on a GAAP basis compared to a $.01 loss last year.  On a Non-GAAP basis they made $.03 a share versus $.01 last year. Our valuation slipped to $2.83 from $2.85 last quarter. Net debt came went up a bit to $8.7 million from $7.6 million last quarter and declined from $11.6 million a year ago. It will be a longer wait to see some action here.

Norm Pessin filed a 13D on November 27, 2013 disclosing a 6.2% stake and upped it to 12.2% in December 2013. Good news that someone else sees the value here. DAEG is trading at about 21% of our valuation.

Down 24%, BUY

Bridgeline Digital Inc. (NASDAQ-BLIN)-Recommended 8/24/2012)

Buy Price $1.17 ($1.24 before 2/14/2014 $10,000 adder)

Valuation $1.75 (Was $1.76, $1.83, $1.61, $2.19, $2.35, $2.56, $2.24)

Closed up $.01 at $.66

Earnings for Q3 announced August 14^th.  Slow improvement. Revenues were $6.2 million up 11% from $5.6 million last year and $5.3 million last quarter. They lost $1.3 million versus $1.6 million last year. They are projecting they will finish the year at $24 million in revenue which would mean another $6 million quarter for Q4. Their backlog rose to almost $26 million (up $6 million from last quarter) and recurring revenues grew 50% to $1.8 million. We continue to think that their recurring revenue stream of $7.2 million a year (based on this quarter) is worth more than the current market cap on BLIN.

Our valuation was $1.75, flat with last quarters $1.76. BLIN is trading at about 38% of our valuation.

Down 49%, BUY

Telecommunications Systems Inc. (NASDAQ-TSYS)-Recommended 6/14/2012)

Buy Price- $1.37

Valuation $6.88 (Was $6.12, $5.99, $5.32, $6.81, $6.28, $4.89, $6.02, $6.72, $5.49)

Closed up $.04 at $2.89

TSYS announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $95.3 million down a tad from $96 million last year and adjusted EPS was $.05 the same as last year. Overall, a decent quarter. Our valuation came in at $6.88 up from $6.81 last year and $6.12 last quarter.

We will continue to hold TSYS despite our over 100% gain. Maybe this will turn into another MITL and be trading at $10+ in the next year.

TSYS is trading at about 42% of our valuation. .

UP 110%, HOLD

MRV Communications (Pink Sheets-MRVC.pk)-Recommended 10//10/2011

Valuation $25.52 (Was $24.58, $23.19, $25.50, $28.98, $24.01 $23.06, $27.15, $31.80, $34.60, $28.60, $41.20, $43.20 (after $9.50, $6.00 and $1.40 special dividends), $52.40, $55.80)

Buy Price October 7, 2011- $8.50 ($25.40 before special dividends)

Closed at $10.12 down $1.10

MRVC announced Q3 2014 (September 30, 2014) earnings on 11/5/2014. Revenues were $43.2 million, up 12% from $38.4 million last year. They lost $1.04 million versus a $.146 million loss last year. Cash per share rose to $2.63 from $2.20 last quarter Our valuation was $25.52 up from $24.58 last quarter. MRVC is trading at 40% of our valuation.

Karen Singer filed a 13G in May 2014 disclosing a 5.3% stake. Singer was a 13D filer before and helped instigate all the special dividends. Good to see them with a healthy stake again.

Lloyd Miller disclosed a 6.9% stake in February 2012.

UP 18% BUY

Sigma Designs Inc. (NASDAQ-SIGM)-Recommended 7/11/2011)

Buy Price-$8.49

Valuation $9.60 (Was $8.24, $9.16, $12.30, $11.86, $8.24, $13.05, $10.67, $8.41 $12.10, $13.40, $16.02)

Closed up $.35 at $4.67

Earnings announced for Q2 FY2015 on September 10^th.  Going in the right direction for a change. Although revenue was down from last year at $42.8 million compared to $53.8 million it was up from the $36.9 million last quarter. Non-GAAP losses was also cut to $2 million from $5 million last quarter. Net cash rose a bit to $2.41 per share and our valuation bounced back up to $9.60. There was no forward guidance given.

Ariel Investments filed a 13G on January 10, 2014 disclosing a 10.1% stake in Sigma.

The CEO bought 343,000 shares back from Potomac Capital in December 2013 leaving Potomac with only 465,000 shares of SIGM. The interesting part was that the CEO paid $5.50 a share or about $1 over its trading price at the time. Either a great expression of confidence in SIGM or a small price to pay to get rid of an activist investor.

Down 45%, BUY

Concurrent Computer (NASDAQ-CCUR)-Recommended 2/4/2011)

Buy Price-$4.58 (Was $5.08 before $.50 special dividend)

Valuation $14.80 (was $17.72, $15.01, $15.10,  $14.55, $14.77, $16.26, $16.20, $15.37, $13.53, $15.85, $14.13, $11.38, $14.04, $18.54, $15.99)

Closed down $.20 at $7.81 (including dividends)

Pays $.48 annual dividend.

CCUR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $17.5 million, up from $17.2 million last year and EPS was $.04 down from $.08 last year. Net cash was $2.92 per share. Our valuation was $14.80 up from $14.55 last year (down from last quarter) after we have collected $.48 worth of dividend payments.

CCUR is trading at about 46% of our valuation and cash is about 43% of the market cap. We have collected $.96 in dividends so far (excluding the $.50 special dividend which reduced our basis).

UP 71%, BUY

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),

NEW Valuation $6.02 (was $5.67, $5.57, $5.70, $6.71, $6.41, $6.14, $5.97, $6.21, $6.13, $5.82, $5.81, $5.72, $5.65, $5.39, $4.86, $5.60, $5.73, $5.54, $5.74, $5.96, $4.72, $5.19, $5.66, $5.63, $5.61, $5.71, $5.49, $5.34, $5.03, $5.28, $5.28, $5.21)

Closed at $3.89, up $.39

ARI announced Q4 2014 (July 31, 2014) earnings on October 29, 2014. Revenues were $8.5 million up slightly from $8.4 million the prior year.  EPS was a profit of $.01 compared to a loss of $.02 last year. ARI’s valuation continued to creep up—to $6.02. Over 90% of their revenues are recurring revenues.

ARI announced another acquisition in October. This one provides software, websites and digital marketing services designed exclusively for dealers, wholesalers, retreaders and manufacturers within the automotive tire and wheel vertical. They have about 600 customers. This deal will add approximately $6 million a year in revenue and positive EBITDA to ARI results. The purchase cost $9.1 million of which $4.2 million was in cash, a $3 million seller note and $1.9 million in stock and a potential earn-out. At 1.5 times sales, this was a reasonable price in our opinion. This should give them about a 15% boost in sales for FY 2015 (started August 1, 2014). They are doing a good job positioning the company to be acquired. Hopefully this will soon happen with a $5+ price like we got for XRS in September 2014.

UP 141%, HOLD, Still a large valuation gap here.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)

Buy price $.27 ask,

Valuation $1.34 (Was $1.22, $.99, $1.02, $1.05,  $1.07, $1.14, $1.17, $1.34, $1.34, $1.37, $1.36, $1.23,  $.91, $1.21, $.71, $.83, $.88 $.96, $.93, $.75, $.85, $1.57, $1.40, $1.29, $1.38, $1.31, $1.38, $1.29, $1.42, $1.28 $1.13, $1.05, $.82)

Ask price $.38 closed at $.36

Q3 earnings announced after the close on Friday when no one was looking. Results were actually good, so why are they hiding it? Another insider take-over bid coming? Revenues were up 14% to $4.1 million from $3.6 million last year and they lost $154,000 versus a loss of $384,000 last year. Adding back non-cash charges for amortization they made $273,000 pre-tax versus $129,000 last year. Cash increased from last quarter to $5.5 million from $5.3 million. They now have $.19 per share in cash. Our valuation rose to $1.34 per share, the highest in 2 years, CTIG is trading at 28% of our valuation.

John Birbeck announced his departure in October 2014. He was one of the group trying to take CTIG private for $.40 a share. Birbeck will remain a Director of the company. He owns about 7% of CTIG (about 2.3 million shares).

They need to get an investment banker and sell the company. Probably get at least $.75 a share for it from someone.

UP 41%. HOLD

We had a .3% loss last week and are now up 5.8% for the year. The DOW up .3% and is now up 6.4% on the year and NASDAQ was up 1.2% and now stands at up 12.3% for the year.

PRSS and CTIG earnings last week.

Some of our stocks are just stupid cheap—compared to their net cash on hand divided by their stock price.

Check this list:

UNTD	42%
CCUR	36%
SIGM	56%
MRVC	23%
SYNC	48%
CTIG	58%

ATEC, PRSS, CAFE, MRVC, DAEG, SYNC, SIGM, CCUR, BLIN, EXTR, DXM and UNTD can still be bought.

Last week we went 4 stocks up and 10 down. Since inception we are now 67 stocks up and 20 down for a 77% winning percentage (80% is our target win %).  Of our closed-out positions 60 have been winners and 13 have been losers for an 82% win percentage and a 35% average net gain per position.

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).

Alphatec Holdings, Inc. (NASDAQ-ATEC)-Recommended 9/2/2014)

Buy Price $1.56

Valuation $2.95 (Was, $3.00)

Closed up $.01 at $1.40

ATEC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $51 million compared to $50.2 million last year. Non-GAAP, EPS was a loss of $.01 compared to a profit of $.01 last year. More significantly, EBITDA was up 22% from $6.7 to $8.2 million. Our valuation came in at $2.95 compared to the previous $3.00. ATEC is trading at 47% of our valuation.

Down 10% BUY

CafePress, Inc.  Inc. (NASDAQ-PRSS)-Recommended 5/19/2014)

Buy Price $5.40

NEW Valuation $11.17 (Was $12.51, $11.27)

Closed down $.63 at $2.30

PRSS announced Q3 2014 (September 30, 2014) earnings on November 13^th, 2014. Revenues were $48.6 million, down slightly from $50.4 million last year. They lost $2.8 million versus a $1.0 million loss last year. Our new valuation was $11.17 down from $12.51 last quarter. PRSS is trading at 21% of our valuation. This is obviously a work-in-progress for a while. We are betting that the new (old) management can right the ship and get revenues and earnings growing again. Only mention of “strategic alternatives” was that they apparently inked a deal to sell InvitationBox” but with no other details. Shares closed at $2.97 on 11/13. This is still a BUY.

Lloyd Miller filed a Form 13G on October 24, 2014 disclosing a 5.1% (887,000 shares) stake in PRSS..

Down 57% BUY

Extreme Networks, Inc.  Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $3.43 (was $3.95 before we added another $10,000)

Valuation $8.24, (Was $9.68, $8.52)

Closed down $.03 at $3.75

EXTR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $137.1 million, Non-GAAP EPS was a loss of $.01. Net cash was $2.92 per share. Overall an OK quarter. Our valuation came in a little better than expected after their preannounced revenue miss for the quarter, at $8.24. Guidance for next quarter is revenue of about $140 to $150 million and Non-GAAP EPS of $.03 to $.07 a share.

The CEO bought 10,000 shares on 8/29 at $5.33 a share.

UP 9% BUY

United Online Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $10.28

Valuation $33.50 (Was $35.84, $32.35, $27.86)

Closed down $.25 at $12.75

UNTD announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $52.9 million compared to $56.2 million last year. Adjusted OIBDA (the term they use-Operating income before depreciation and amortization) was $10.2 million compared to $10 million last year. Cash rose to $5.38 a share. Our valuation fell a bit to $33.50—still well above the current trading price. They are projecting $215-218 million in revenue for the year and $32-$35 million in OIBDA for the year.

UNTD is trading at about 38% of our valuation and cash is 42% of the market cap ($5.38 a share versus $4.98 a share last quarter.

Up 24% BUY

Synacor Inc. (NASDAQ-SYNC)-Recommended 12/17/2013)

Buy Price $2.56

Valuation $5.58 (Was $5.21, $5.44, $6.67, $6.39)’

Closed down $.12 at $1.65

SYNC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $26.2 million down slightly from $26.5 million the prior year.  They had a Non-GAAP loss of about $1.4 million compared to a loss of $.4 million last year. SYNC’s valuation rose from last quarter to $5.58, but was still lower than last years $6.01.

JEC and Ratio Capital seem to have been quiet lately.

Down 36%. BUY

Dex Media Inc. (NASDAQ-DXM)-Recommended 5/10/2013)

Buy Price $15.14

Valuation $31.00 (Was $34.00, $37.98, $34.36, $31.50, $24.25)

Closed down $.58 at $8.48

DXM announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $452 million, down from $474 million last quarter and adjusted EBITDA was $167 million down from 174 million last quarter. Overall an OK quarter. Our valuation fell a bit to $31 down from $34  last quarter. They have paid off $319 million of net debt over the last twelve months and total net debt stands at $2.3 billion.

Looking back to 2012 at their projections before the merger it looks like they will miss their 2014 projections for revenue and adjusted EBITDA by 10-15%, but will beat their projected debt reduction target by over $100 million. The faster they get rid of the huge debt, the better as it is the primary risk factor affecting the stock price in our opinion.

DXM is trading at about 27% of our valuation, but due to the high debt level and small number of shares outstanding, relatively small changes in DXM’s results can cause large swings in our valuation.

Down 44% BUY

Daegis Inc. (NASDAQ-DAEG)-Recommended 11/30/2012)

Buy Price $1.09 (Was $1.20 before we doubled up)

Valuation $2.85 (Was $3.39, $3.25, $3.42, $4.64, $4.86, $4.00)

Closed down $.05 at $.60

First quarter (7/31/2014) earnings announced on August 26^th.

Revenues were $6.7 million down from $8 million last year and $7.2 million last quarter. They lost $.02 per share on a GAAP basis.  On a Non-GAAP basis they made $.01 a share versus $.03 last year. Our valuation fell to $2.85 up from $3.39 last quarter. Net debt came down to $7.6 million from $11 million a year ago and their credit agreement was extended out to June 2017. This is a drop-off from last quarter, but they are still making money and paying off debt. It will be a longer wait to see some action here.

Norm Pessin filed a 13D on November 27, 2013 disclosing a 6.2% stake and upped it to 12.2% in December 2013. Good news that someone else sees the value here. DAEG is trading at about 21% of our valuation.

Down 45%, BUY

Bridgeline Digital Inc. (NASDAQ-BLIN)-Recommended 8/24/2012)

Buy Price $1.17 ($1.24 before 2/14/2014 $10,000 adder)

Valuation $1.75 (Was $1.76, $1.83, $1.61, $2.19, $2.35, $2.56, $2.24)

Closed up $.01 at $.65

Earnings for Q3 announced August 14^th.  Slow improvement. Revenues were $6.2 million up 11% from $5.6 million last year and $5.3 million last quarter. They lost $1.3 million versus $1.6 million last year. They are projecting they will finish the year at $24 million in revenue which would mean another $6 million quarter for Q4. Their backlog rose to almost $26 million (up $6 million from last quarter) and recurring revenues grew 50% to $1.8 million. We continue to think that their recurring revenue stream of $7.2 million a year (based on this quarter) is worth more than the current market cap on BLIN.

Our valuation was $1.75, flat with last quarters $1.76. BLIN is trading at about 37% of our valuation.

Down 48%, BUY

Telecommunications Systems Inc. (NASDAQ-TSYS)-Recommended 6/14/2012)

Buy Price- $1.37

Valuation $6.88 (Was $6.12, $5.99, $5.32, $6.81, $6.28, $4.89, $6.02, $6.72, $5.49)

Closed down $.04 at $2.85

TSYS announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $95.3 million down a tad from $96 million last year and adjusted EPS was $.05 the same as last year. Overall, a decent quarter. Our valuation came in at $6.88 up from $6.81 last year and $6.12 last quarter.

We will continue to hold TSYS despite our over 100% gain. Maybe this will turn into another MITL and be trading at $10+ in the next year.

TSYS is trading at about 42% of our valuation. .

UP 108%, HOLD

MRV Communications (Pink Sheets-MRVC.pk)-Recommended 10//10/2011

Valuation $25.52 (Was $24.58, $23.19, $25.50, $28.98, $24.01 $23.06, $27.15, $31.80, $34.60, $28.60, $41.20, $43.20 (after $9.50, $6.00 and $1.40 special dividends), $52.40, $55.80)

Buy Price October 7, 2011- $8.50 ($25.40 before special dividends)

Closed at $11.22 down $.25

MRVC announced Q3 2014 (September 30, 2014) earnings on 11/5/2014. Revenues were $43.2 million, up 12% from $38.4 million last year. They lost $1.04 million versus a $.146 million loss last year. Cash per share rose to $2.63 from $2.20 last quarter Our valuation was $25.52 up from $24.58 last quarter. MRVC is trading at 44% of our valuation.

Karen Singer filed a 13G in May 2014 disclosing a 5.3% stake. Singer was a 13D filer before and helped instigate all the special dividends. Good to see them with a healthy stake again.

Lloyd Miller disclosed a 6.9% stake in February 2012.

UP 31% BUY

Sigma Designs Inc. (NASDAQ-SIGM)-Recommended 7/11/2011)

Buy Price-$8.49

Valuation $9.60 (Was $8.24, $9.16, $12.30, $11.86, $8.24, $13.05, $10.67, $8.41 $12.10, $13.40, $16.02)

Closed up $.24 at $4.32

Earnings announced for Q2 FY2015 on September 10^th. Going in the right direction for a change. Although revenue was down from last year at $42.8 million compared to $53.8 million it was up from the $36.9 million last quarter. Non-GAAP loses was also cut to $2 million from $5 million last quarter. Net cash rose a bit to $2.41 per share and our valuation bounced back up to $9.60. There was no forward guidance given.

Ariel Investments filed a 13G on January 10, 2014 disclosing a 10.1% stake in Sigma.

The CEO bought 343,000 shares back from Potomac Capital in December 2013 leaving Potomac with only 465,000 shares of SIGM. The interesting part was that the CEO paid $5.50 a share or about $1 over its trading price at the time. Either a great expression of confidence in SIGM or a small price to pay to get rid of an activist investor.

Down 49%, BUY

Concurrent Computer (NASDAQ-CCUR)-Recommended 2/4/2011)

Buy Price-$4.58 (Was $5.08 before $.50 special dividend)

Valuation $14.80 (was $17.72, $15.01, $15.10,  $14.55, $14.77, $16.26, $16.20, $15.37, $13.53, $15.85, $14.13, $11.38, $14.04, $18.54, $15.99)

Closed up $.07 at $8.01 (including dividends)

Pays $.48 annual dividend.

CCUR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $17.5 million, up from $17.2 million last year and EPS was $.04 down from $.08 last year. Net cash was $2.92 per share. Our valuation was $14.80 up from $14.55 last year (down from last quarter) after we have collected $.48 worth of dividend payments.

CCUR is trading at about 48% of our valuation and cash is about 41% of the market cap. We have collected $.96 in dividends so far (excluding the $.50 special dividend which reduced our basis).

UP 75%, BUY

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),

NEW Valuation $6.02 (was $5.67, $5.57, $5.70, $6.71, $6.41, $6.14, $5.97, $6.21, $6.13, $5.82, $5.81, $5.72, $5.65, $5.39, $4.86, $5.60, $5.73, $5.54, $5.74, $5.96, $4.72, $5.19, $5.66, $5.63, $5.61, $5.71, $5.49, $5.34, $5.03, $5.28, $5.28, $5.21)

Closed at $3.50, up $.26

ARI announced Q4 2014 (July 31, 2014) earnings on October 29, 2014. Revenues were $8.5 million up slightly from $8.4 million the prior year.  EPS was a profit of $.01 compared to a loss of $.02 last year. ARI’s valuation continued to creep up—to $6.02. Over 90% of their revenues are recurring revenues.

ARI announced another acquisition in October. This one provides software, websites and digital marketing services designed exclusively for dealers, wholesalers, retreaders and manufacturers within the automotive tire and wheel vertical. They have about 600 customers. This deal will add approximately $6 million a year in revenue and positive EBITDA to ARI results. The purchase cost $9.1 million of which $4.2 million was in cash, a $3 million seller note and $1.9 million in stock and a potential earn-out. At 1.5 times sales, this was a reasonable price in our opinion. This should give them about a 15% boost in sales for FY 2015 (started August 1, 2014). They are doing a good job positioning the company to be acquired. Hopefully this will soon happen with a $5+ price like we got for XRS in September 2014.

UP 117%, HOLD, Still a large valuation gap here.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)

Buy price $.27 ask,

NEW Valuation $1.34 (Was $1.22, $.99, $1.02, $1.05,  $1.07, $1.14, $1.17, $1.34, $1.34, $1.37, $1.36, $1.23,  $.91, $1.21, $.71, $.83, $.88 $.96, $.93, $.75, $.85, $1.57, $1.40, $1.29, $1.38, $1.31, $1.38, $1.29, $1.42, $1.28 $1.13, $1.05, $.82)

Ask price $.33 closed at $.30

Q3 earnings announced after the close on Friday when no one was looking. Results were actually good, so why are they hiding it? Another insider take-over bid coming? Revenues were up 14% to $4.1 million from $3.6 million last year and they lost $154,000 versus a loss of $384,000 last year. Adding back non-cash charges for amortization they made $273,000 pre-tax versus $129,000 last year. Cash increased from last quarter to $5.5 million from $5.3 million. They now have $.19 per share in cash. Our valuation rose to $1.34 per share, the highest in 2 years, CTIG is trading at 25% of our valuation.

John Birbeck announced his departure in October 2014. He was one of the group trying to take CTIG private for $.40 a share. Birbeck will remain a Director of the company. He owns about 7% of CTIG (about 2.3 million shares).

They need to get an investment banker and sell the company. Probably get at least $.75 a share for it from someone.

UP 20%. HOLD

PRSS announced Q3 2014 (September 30, 2014) earnings after the close last night. Revenues were $48.6 million, down slightly from $50.4 million last year. They lost $2.8 million versus a $1.0 million loss last year. Our valuation was $11.17 down from $12.51 last quarter. PRSS is trading at 27% of our valuation. This is obviously a work-in-progress for a while. We are betting that the new (old) management can right the ship and get revenues and earnings growing again. Only mention of “strategic alternatives” was that they apparently inked a deal to sell InvitationBox” but with no other details. Shares closed at $2.97 on 11/13/2014. This is still a BUY.

We had a .7% loss last week and are now up 6.1% for the year. I guess we need another deal or two to beat the market averages this year. The DOW up 1.00% and is now up 6.0% on the year and NASDAQ was up even% and now stands at up 10.9% for the year.

DXM, UNTD and MRVC earnings last week.

Some of our stocks are just stupid cheap—compared to their net cash on hand divided by their stock price.

Check this list:

UNTD	41%
CCUR	37%
SIGM	59%
MRVC	23%
SYNC	45%

ATEC, PRSS, CAFE, MRVC, DAEG, SYNC, SIGM, CCUR, BLIN, EXTR, DXM and UNTD can still be bought.

Last week we went 6 stocks up, 7 down and 1 unchanged. Since inception we are now 67 stocks up and 20 down for a 77% winning percentage (80% is our target win %).  Of our closed-out positions 60 have been winners and 13 have been losers for an 82% win percentage and a 35% average net gain per position.

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).

Alphatec Holdings, Inc. (NASDAQ-ATEC)-Recommended 9/2/2014)

Buy Price $1.56

Valuation $2.95 (Was, $3.00)

Closed dpwn $.13 at $1.39

ATEC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $51 million compared to $50.2 million last year. Non-GAAP, EPS was a loss of $.01 compared to a profit of $.01 last year. More significantly, EBITDA was up 22% from $6.7 to $8.2 million. Our valuation came in at $2.95 compared to the previous $3.00. ATEC is trading at 47% of our valuation.

Down 11% BUY

CafePress, Inc.  Inc. (NASDAQ-PRSS)-Recommended 5/19/2014)

Buy Price $5.40

Valuation $12.51 (Was, $11.27)

Closed down $.16 at $2.93

Lloyd Miller filed a Form 13G on October 24, 2014 disclosing a 5.1% (887,000 shares) stake in PRSS.

Q3 earnings due out Thursday, November 13^th, after the market close.

Earnings announced on August 12^th. Nothing to write home about and no update on their “strategic alternatives”. They did announce the “retirement” of the current CEO and the return of the two founders as CEO and Chief Marketing Officer.  They also made their interim CFO, permanent. Revenues were down less than $1 million to $51.4 million and Non-GAAP loss was $1.8 million ($.11 per share) up from a $.7 million loss or $.04 per share last year. Our valuation actually rose from last quarter to $12.51 mostly on reduced losses.

Waiting on the outcome of their review of “strategic alternatives” which now seems like it will take a few more quarters as the founders right the ship, which will probably entail a restructuring and some investment in the business.

Down 46% BUY

Extreme Networks, Inc.  Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $3.43 (was $3.95 before we added another $10,000)

Valuation $8.24, (Was $9.68, $8.52)

Closed up $.19 at $3.78

EXTR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $137.1 million, Non-GAAP EPS was a loss of $.01. Net cash was $2.92 per share. Overall an OK quarter. Our valuation came in a little better than expected after their preannounced revenue miss for the quarter, at $8.24. Guidance for next quarter is revenue of about $140 to $150 million and Non-GAAP EPS of $.03 to $.07 a share.The CEO bought 10,000 shares on 8/29 at $5.33 a share.

UP 10% BUY

United Online Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $10.28

NEW Valuation $33.50 (Was $35.84, $32.35, $27.86)

Closed up $1.78 at $13.00

UNTD announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $52.9 million compared to $56.2 million last year. Adjusted OIBDA (the term they use-Operating income before depreciation and amortization) was $10.2 million compared to $10 million last year. Cash rose to $5.38 a share. Our valuation fell a bit to $33.50—still well above the current trading price. They are projecting $215-218 million in revenue for the year and $32-$35 million in OIBDA for the year.

UNTD is trading at about 39% of our valuation and cash is 41% of the market cap ($5.38 a share versus $4.98 a share last quarter.

Up 27% BUY

Synacor Inc. (NASDAQ-SYNC)-Recommended 12/17/2013)

Buy Price $2.56

Valuation $5.58 (Was $5.21, $5.44, $6.67, $6.39)’

Closed down $.13 at $1.77

SYNC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $26.2 million down slightly from $26.5 million the prior year.  They had a Non-GAAP loss of about $1.4 million compared to a loss of $.4 million last year. SYNC’s valuation rose from last quarter to $5.58, but was still lower than last years $6.01.

JEC and Ratio Capital seem to have been quiet lately.

Down 31%. BUY

Dex Media Inc. (NASDAQ-DXM)-Recommended 5/10/2013)

Buy Price $15.14

NEW Valuation $31.00 (Was $34.00, $37.98, $34.36, $31.50, $24.25)

Closed up $1.27 at $9.06

DXM announced Q3 2014 (September 30, 2014) earnings on 11/4/2014. Revenues were $452 million, down from $474 million last quarter and adjusted EBITDA was $167 million down from 174 million last quarter. Overall an OK quarter. Our valuation fell a bit to $31 down from $34  last quarter. They have paid off $319 million of net debt over the last twelve months and total net debt stands at $2.3 billion.

Looking back to 2012 at their projections before the merger it looks like they will miss their 2014 projections for revenue and adjusted EBITDA by 10-15%, but will beat their projected debt reduction target by over $100 million. The faster they get rid of the huge debt, the better as it is the primary risk factor affecting the stock price in our opinion.

DXM is trading at about 29% of our valuation, but due to the high debt level and small number of shares outstanding, relatively small changes in DXM’s results can cause large swings in our valuation.

Down 40% BUY

Daegis Inc. (NASDAQ-DAEG)-Recommended 11/30/2012)

Buy Price $1.09 (Was $1.20 before we doubled up)

Valuation $2.85 (Was $3.39, $3.25, $3.42, $4.64, $4.86, $4.00)

Closed up $.04 at $.65

First quarter (7/31/2014) earnings announced on August 26^th.

Revenues were $6.7 million down from $8 million last year and $7.2 million last quarter. They lost $.02 per share on a GAAP basis.  On a Non-GAAP basis they made $.01 a share versus $.03 last year. Our valuation fell to $2.85 up from $3.39 last quarter. Net debt came down to $7.6 million from $11 million a year ago and their credit agreement was extended out to June 2017. This is a drop-off from last quarter, but they are still making money and paying off debt. It will be a longer wait to see some action here.

Norm Pessin filed a 13D on November 27, 2013 disclosing a 6.2% stake and upped it to 12.2% in December 2013. Good news that someone else sees the value here. DAEG is trading at about 23% of our valuation.

Down 40%, BUY

Bridgeline Digital Inc. (NASDAQ-BLIN)-Recommended 8/24/2012)

Buy Price $1.17 ($1.24 before 2/14/2014 $10,000 adder)

Valuation $1.75 (Was $1.76, $1.83, $1.61, $2.19, $2.35, $2.56, $2.24)

Closed down $.01 at $.64

Earnings for Q3 announced August 14^th.  Slow improvement. Revenues were $6.2 million up 11% from $5.6 million last year and $5.3 million last quarter. They lost $1.3 million versus $1.6 million last year. They are projecting they will finish the year at $24 million in revenue which would mean another $6 million quarter for Q4. Their backlog rose to almost $26 million (up $6 million from last quarter) and recurring revenues grew 50% to $1.8 million. We continue to think that their recurring revenue stream of $7.2 million a year (based on this quarter) is worth more than the current market cap on BLIN.

Our valuation was $1.75, flat with last quarters $1.76. BLIN is trading at about 37% of our valuation.

Down 48%, BUY

Telecommunications Systems Inc. (NASDAQ-TSYS)-Recommended 6/14/2012)

Buy Price- $1.37

Valuation $6.88 (Was $6.12, $5.99, $5.32, $6.81, $6.28, $4.89, $6.02, $6.72, $5.49)

Closed up $.01 at $2.89

TSYS announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $95.3 million down a tad from $96 million last year and adjusted EPS was $.05 the same as last year. Overall, a decent quarter. Our valuation came in at $6.88 up from $6.81 last year and $6.12 last quarter.

We will continue to hold TSYS despite our over 100% gain. Maybe this will turn into another MITL and be trading at $10+ in the next year.

TSYS is trading at about 42% of our valuation. .

UP 111%, HOLD

MRV Communications (Pink Sheets-MRVC.pk)-Recommended 10//10/2011

NEW Valuation $25.52 (Was $24.58, $23.19, $25.50, $28.98, $24.01 $23.06, $27.15, $31.80, $34.60, $28.60, $41.20, $43.20 (after $9.50, $6.00 and $1.40 special dividends), $52.40, $55.80)

Buy Price October 7, 2011- $8.50 ($25.40 before special dividends)

Closed at $11.52 up $.09

MRVC announced Q3 2014 (September 30, 2014) earnings on 11/5/2014. Revenues were $43.2 million, up 12% from $38.4 million last year. They lost $1.04 million versus a $.146 million loss last year. Cash per share rose to $2.63 from $2.20 last quarter Our valuation was $25.52 up from $24.58 last quarter. MRVC is trading at 45% of our valuation.

Karen Singer filed a 13G in May 2014 disclosing a 5.3% stake. Singer was a 13D filer before and helped instigate all the special dividends. Good to see them with a healthy stake again.

Lloyd Miller disclosed a 6.9% stake in February 2012.

UP 34% BUY

Sigma Designs Inc. (NASDAQ-SIGM)-Recommended 7/11/2011)

Buy Price-$8.49

Valuation $9.60 (Was $8.24, $9.16, $12.30, $11.86, $8.24, $13.05, $10.67, $8.41 $12.10, $13.40, $16.02)

Closed up $.09 at $4.08

Earnings announced for Q2 FY2015 on September 10^th. Going in the right direction for a change. Although revenue was down from last year at $42.8 million compared to $53.8 million it was up from the $36.9 million last quarter. Non-GAAP loses was also cut to $2 million from $5 million last quarter. Net cash rose a bit to $2.41 per share and our valuation bounced back up to $9.60. There was no forward guidance given.

Ariel Investments filed a 13G on January 10, 2014 disclosing a 10.1% stake in Sigma.

The CEO bought 343,000 shares back from Potomac Capital in December 2013 leaving Potomac with only 465,000 shares of SIGM. The interesting part was that the CEO paid $5.50 a share or about $1 over its trading price at the time. Either a great expression of confidence in SIGM or a small price to pay to get rid of an activist investor.

Down 52%, BUY

Concurrent Computer (NASDAQ-CCUR)-Recommended 2/4/2011)

Buy Price-$4.58 (Was $5.08 before $.50 special dividend)

Valuation $14.80 (was $17.72, $15.01, $15.10,  $14.55, $14.77, $16.26, $16.20, $15.37, $13.53, $15.85, $14.13, $11.38, $14.04, $18.54, $15.99)

Closed down $.12 at $7.94 (including dividends)

Pays $.48 annual dividend.

CCUR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $17.5 million, up from $17.2 million last year and EPS was $.04 down from $.08 last year. Net cash was $2.92 per share. Our valuation was $14.80 up from $14.55 last year (down from last quarter) after we have collected $.48 worth of dividend payments.

CCUR is trading at about 47% of our valuation and cash is about 42% of the market cap. We have collected $.96 in dividends so far (excluding the $.50 special dividend which reduced our basis).

UP 73%, BUY

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),

NEW Valuation $6.02 (was $5.67, $5.57, $5.70, $6.71, $6.41, $6.14, $5.97, $6.21, $6.13, $5.82, $5.81, $5.72, $5.65, $5.39, $4.86, $5.60, $5.73, $5.54, $5.74, $5.96, $4.72, $5.19, $5.66, $5.63, $5.61, $5.71, $5.49, $5.34, $5.03, $5.28, $5.28, $5.21)

Closed at $3.24, down $.22

ARI announced Q4 2014 (July 31, 2014) earnings on October 29, 2014. Revenues were $8.5 million up slightly from $8.4 million the prior year.  EPS was a profit of $.01 compared to a loss of $.02 last year. ARI’s valuation continued to creep up—to $6.02. Over 90% of their revenues are recurring revenues.

ARI announced another acquisition in October. This one provides software, websites and digital marketing services designed exclusively for dealers, wholesalers, retreaders and manufacturers within the automotive tire and wheel vertical. They have about 600 customers. This deal will add approximately $6 million a year in revenue and positive EBITDA to ARI results. The purchase cost $9.1 million of which $4.2 million was in cash, a $3 million seller note and $1.9 million in stock and a potential earn-out. At 1.5 times sales, this was a reasonable price in our opinion. This should give them about a 15% boost in sales for FY 2015 (started August 1, 2014). They are doing a good job positioning the company to be acquired. Hopefully this will soon happen with a $5+ price like we got for XRS in September.

UP 110%, HOLD, Still a large valuation gap here.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)

Buy price $.27 ask,

Valuation $1.22 (Was $.99, $1.02, $1.05,  $1.07, $1.14, $1.17, $1.34, $1.34, $1.37, $1.36, $1.23,  $.91, $1.21, $.71, $.83, $.88 $.96, $.93, $.75, $.85, $1.57, $1.40, $1.29, $1.38, $1.31, $1.38, $1.29, $1.42, $1.28 $1.13, $1.05, $.82)

Ask price $.38 closed at $.335

John Birbeck announced his departure in October 2014. He was one of the group trying to take CTIG private for $.40 a share. Birbeck will remain a Director of the company. He owns about 7% of CTIG (about 2.3 million shares).

Q2 earnings disclosed on their Form 10Q on 8/14 and a press release!.  Another good quarter. Revenues were $4.1 million versus $3.9 million last year and they reported a $.01 loss, the same as last year. Cash soared to $.17 per share from zero last quarter. Deferred revenues more than doubled from December 31, 2013 to $5.8 million.

Our valuation jumped 23% to $1.22 a share, the highest in over a year.

CTI announced in June that the special committee of the Board of Directors rejected managements $.40 buy-out offer. Then the special committee was promptly disbanded. This company should not be a public company, but we can understand the decision in rejecting a lowball offer. They need to get an investment banker and sell the company. Probably get at least $.75 a share for it from someone.

UP 41%. HOLD

MRV Communications (MRVC) earnings update.

MRVC announced Q3 2014 (September 30, 2014) earnings after the close last night. Revenues were $43.2 million, up 12% from from $38.4 million last year. They lost $1.04 million versus a $.146 million loss last year. Cash per share rose to $2.63 from $2.20 last quarter. Our valuation was $25.52 up from $24.58 last quarter. MRVC is trading at 47% of our valuation. Shares closed at $11.93 on 11/5. This is still a BUY.

Dex Media (DXM) earnings update.

DXM announced Q3 2014 (September 30, 2014) earnings after the close last night. Revenues were $452 million, down from $474 million last quarter and adjusted EBITDA was $167 million down from 174 million last quarter. Overall an OK quarter. Our valuation was $31 down from $34  last quarter. DXM is trading at 25% of our valuation. Shares closed at $7.75 on 11/4. This is still a BUY (but risky).

United Online (UNTD) earnings update

UNTD announced Q3 2014 (September 30, 2014) earnings after the close last night. Revenues were $52.9 million compared to $56.2 million last year. Adjusted OIBDA (the term they use-Operating income before depreciation and amortization) was $10.2 million compared to $10 million last year. Cash rose to $5.38 a share. Our valuation fell a bit to $33.50—still well above the current trading price.  UNTD closed  at $11.59 on 11/4. They are projecting $215-218 million in revenue for the year and $32-$35 million in OIBDA for the year. UNTD is still a BUY.

We made up a little ground on the market averages last week. I guess we need another deal or two to beat the market averages this year. We were up 4.2% last week and are up 6.8% for the year, while  the DOW up 3.5% and is now up 4.9% on the year and NASDAQ was up 3.3% and now stands at up 10.9% for the year.

TSYS, SYNC, ATEC, CCUR, EXTR, ARIS earnings last week.

Some of our stocks are just stupid cheap—compared to their net cash on hand divided by their stock price.

Check this list:

UNTD	44%
CCUR	36%
SIGM	60%
MRVC	19%
SYNC	42%

ATEC, PRSS, CAFE, MRVC, DAEG, SYNC, SIGM, CCUR, BLIN, EXTR, DXM and UNTD can still be bought.

Last week we went 9 stocks up, 4 down and 1 unchanged. Since inception we are now 67 stocks up and 20 down for a 77% winning percentage (80% is our target win %).  Of our closed-out positions 60 have been winners and 13 have been losers for an 82% win percentage and a 35% average net gain per position.

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).

Alphatec Holdings, Inc. (NASDAQ-ATEC)-Recommended 9/2/2014)

Buy Price $1.56

NEW Valuation $2.95 (Was, $3.00)

Closed up $.06 at $1.52

ATEC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $51 million compared to $50.2 million last year. Non-GAAP, EPS was a loss of $.01 compared to a profit of $.01 last year. More significantly, EBITDA was up 22% from $6.7 to $8.2 million. Our valuation came in at $2.95 compared to the previous $3.00. ATEC is trading at 51% of our valuation.

Down 3% BUY

CafePress, Inc.  Inc. (NASDAQ-PRSS)-Recommended 5/19/2014)

Buy Price $5.40

Valuation $12.51 (Was, $11.27)

Closed down $.22 at $2.90

Lloyd Miller filed a Form 13G on October 24, 2014 disclosing a 5.1% (887,000 shares) stake in PRSS.

Q3 earnings due out Thursday, November 13^th, after the market close.

Earnings announced on August 12^th. Nothing to write home about and no update on their “strategic alternatives”. They did announce the “retirement” of the current CEO and the return of the two founders as CEO and Chief Marketing Officer.  They also made their interim CFO, permanent. Revenues were down less than $1 million to $51.4 million and Non-GAAP loss was $1.8 million ($.11 per share) up from a $.7 million loss or $.04 per share last year. Our valuation actually rose from last quarter to $12.51 mostly on reduced losses.

Waiting on the outcome of their review of “strategic alternatives” which now seems like it will take a few more quarters as the founders right the ship, which will probably entail a restructuring and some investment in the business.

Down 43% BUY

Extreme Networks, Inc.  Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $3.43 (was $3.95 before we added another $10,000)

NEW Valuation $8.24, (Was $9.68, $8.52)

Closed up $.07 at $3.14

EXTR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $137.1 million, Non-GAAP EPS was a loss of $.01. Net cash was $2.92 per share. Overall an OK quarter. Our valuation came in a little better than expected after their preannounced revenue miss for the quarter, at $8.24. Guidance for next quarter is revenue of about $140 to $150 million and Non-GAAP EPS of $.03 to $.07 a share.

The CEO bought 10,000 shares on 8/29 at $5.33 a share.

UP 5% BUY

United Online Inc. (NASDAQ-UNTD)-Recommended 3/12/2014)

Buy Price $10.28

Valuation $35.84 (Was $32.35, $27.86)

Closed up $.37 at $11.22

Next earnings due out Tuesday, November 4^th after the market close.

UNTD announced Q2 2014 earnings after the close on August 11, 2014. Revenues were $55.4 million down 3% from $57.2 million last year. GAAP net loss was $.75 a share, compared to income of $.03 per share last year. OIBDA (operating income before depreciation and amortization-the term United uses, which is essentially EBITDA) was $10.1 million compared to $10.1 million last year. Our valuation rose to $35.84 from $32.35 last quarter. UNTD is trading at about 31% of our valuation and cash is 41% of the market cap ($4.98 a share versus $4.79 a share last quarter.

Up 9% BUY

Synacor Inc. (NASDAQ-SYNC)-Recommended 12/17/2013)

Buy Price $2.56

NEW Valuation $5.58 (Was $5.21, $5.44, $6.67, $6.39)’

Closed up $.31 at $1.90

SYNC announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $26.2 million down slightly from $26.5 million the prior year.  They had a Non-GAAP loss of about $1.4 million compared to a loss of $.4 million last year. SYNC’s valuation rose from last quarter to $5.58, but was still lower than last years $6.01.

JEC and Ratio Capital seem to have been quiet lately.

Down 26%. BUY

Dex Media Inc. (NASDAQ-DXM)-Recommended 5/10/2013)

Buy Price $15.14

Valuation $34.00 (Was $37.98, $34.36, $31.50, $24.25)

Closed down $.20 at $7.79

Next earnings due out Tuesday, November 4^th, before the market opens.

DXM announced another debt tender in September, this time for about $29 million of debt at discounts ranging from 10% to 23%. Not as big a discount range as previous tenders as their debt prices have firmed based on their continued good performance.

DXM announced Q1 2014 earnings on August 11th. Revenues were $474 million down from $558 million last year (adjusting for the SuperMedia acquisition). GAAP net loss was $4.93 a share, compared to a loss of $4.58 per share last year. Adjusted EBITDA was $174 million compared to $214 million last year. Again, not a bad quarter as YOY declines have been anticipated, but again a bit below our expectations. DXM generated $105 million of free cash flow in the quarter and paid down its debt by $128 million in the quarter. Net debt stands at $2.370 billion.  Our valuation fell a tad to $34.00, from $37.98 last quarter. DXM is trading at about 23% of our valuation, but due to the high debt level and small number of shares outstanding, relatively small changes in DXM’s results can cause large swings in our valuation.

Down 49% BUY

Daegis Inc. (NASDAQ-DAEG)-Recommended 11/30/2012)

Buy Price $1.09 (Was $1.20 before we doubled up)

Valuation $2.85 (Was $3.39, $3.25, $3.42, $4.64, $4.86, $4.00)

Closed down $.11 at $.61

First quarter (7/31/2014) earnings announced on August 26^th.

Revenues were $6.7 million down from $8 million last year and $7.2 million last quarter. They lost $.02 per share on a GAAP basis.  On a Non-GAAP basis they made $.01 a share versus $.03 last year. Our valuation fell to $2.85 up from $3.39 last quarter. Net debt came down to $7.6 million from $11 million a year ago and the credit agreement was extended out to June 2017. This is a drop-off from last quarter, but they are still making money and paying off debt. It will be a longer wait to see some action here.

Norm Pessin filed a 13D on November 27, 2013 disclosing a 6.2% stake and upped it to 12.2% in December 2013. Good news that someone else sees the value here. DAEG is trading at about 21% of our valuation.

Down 44%, BUY

Bridgeline Digital Inc. (NASDAQ-BLIN)-Recommended 8/24/2012)

Buy Price $1.17 ($1.24 before 2/14/2014 $10,000 adder)

Valuation $1.75 (Was $1.76, $1.83, $1.61, $2.19, $2.35, $2.56, $2.24)

Closed down $.01 at $.65

Earnings for Q3 announced August 14^th.  Slow improvement. Revenues were $6.2 million up 11% from $5.6 million last year and $5.3 million last quarter. They lost $1.3 million versus $1.6 million last year. They are projecting they will finish the year at $24 million in revenue which would mean another $6 million quarter for Q4. Their backlog rose to almost $26 million (up $6 million from last quarter) and recurring revenues grew 50% to $1.8 million. We continue to think that their recurring revenue stream of $7.2 million a year (based on this quarter) is worth more than the current market cap on BLIN.

Our valuation was $1.75, flat with last quarters $1.76. BLIN is trading at about 37% of our valuation.

Down 48%, BUY

Telecommunications Systems Inc. (NASDAQ-TSYS)-Recommended 6/14/2012)

Buy Price- $1.37

NEW Valuation $6.88 (Was $6.12, $5.99, $5.32, $6.81, $6.28, $4.89, $6.02, $6.72, $5.49)

Closed up $.07 at $2.88

TSYS announced Q3 2014 (September 30, 2014) earnings on October 30, 2014. Revenues were $95.3 million down a tad from $96 million last year and adjusted EPS was $.05 the same as last year. Overall, a decent quarter. Our valuation came in at $6.88 up from $6.81 last year and $6.12 last quarter.

We will continue to hold TSYS despite our over 100% gain. Maybe this will turn into another MITL and be trading at $10+ in the next year.

TSYS is trading at about 42% of our valuation. .

UP 110%, HOLD

MRV Communications (Pink Sheets-MRVC.pk)-Recommended 10//10/2011

Valuation $24.58 (Was $23.19, $25.50, $28.98, $24.01 $23.06, $27.15, $31.80, $34.60, $28.60, $41.20, $43.20 (after $9.50, $6.00 and $1.40 special dividends), $52.40, $55.80)

Buy Price October 7, 2011- $8.50 ($25.40 before special dividends)

Closed at $11.52 up $.09

MRVC filed their 10Q on August 19^th.

Revenues continued their consistent climb upward to $43.1 million from $38.2 million. Gross margin recovered a bit to 34% from 31% last quarter. GAAP net loss per share was $.31 versus $.13 last year and our valuation rose to $24.58.

Karen Singer filed a 13G in May 2014 disclosing a 5.3% stake. Singer was a 13D filer before and helped instigate all the special dividends. Good to see them with a healthy stake again.

Lloyd Miller disclosed a 6.9% stake in February 2012.

UP 34% BUY

Sigma Designs Inc. (NASDAQ-SIGM)-Recommended 7/11/2011)

Buy Price-$8.49

Valuation $9.60 (Was $8.24, $9.16, $12.30, $11.86, $8.24, $13.05, $10.67, $8.41 $12.10, $13.40, $16.02)

Closed up $.06 at $3.99

Earnings announced for Q2 FY2015 on September 10^th. Going in the right direction for a change. Although revenue was down from last year at $42.8 million compared to $53.8 million it was up from the $36.9 million last quarter. Non-GAAP loses was also cut to $2 million from $5 million last quarter. Net cash rose a bit to $2.41 per share and our valuation bounced back up to $9.60. There was no forward guidance given.

Ariel Investments filed a 13G on January 10, 2014 disclosing a 10.1% stake in Sigma.

The CEO bought 343,000 shares back from Potomac Capital in December 2013 leaving Potomac with only 465,000 shares of SIGM. The interesting part was that the CEO paid $5.50 a share or about $1 over its trading price at the time. Either a great expression of confidence in SIGM or a small price to pay to get rid of an activist investor.

Down 53%, BUY

Concurrent Computer (NASDAQ-CCUR)-Recommended 2/4/2011)

Buy Price-$4.58 (Was $5.08 before $.50 special dividend)

NEW Valuation $14.80 (was $17.72, $15.01, $15.10,  $14.55, $14.77, $16.26, $16.20, $15.37, $13.53, $15.85, $14.13, $11.38, $14.04, $18.54, $15.99)

Closed down $.25 at $8.06 (including dividends)

Pays $.48 annual dividend.

CCUR announced Q1 2015 (September 30, 2014) earnings on October 29, 2014. Revenues were $17.5 million, up from $17.2 million last year and EPS was $.04 down from $.08 last year. Net cash was $2.92 per share. Our valuation was $14.80 up from $14.55 last year (down from last quarter) after we have collected $.48 worth of dividend payments.

CCUR is trading at about 48% of our valuation and cash is about 40% of the market cap. We have collected $.96 in dividends so far (excluding the $.50 special dividend which reduced our basis).

UP 81%, BUY

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),

NEW Valuation $6.02 (was $5.67, $5.57, $5.70, $6.71, $6.41, $6.14, $5.97, $6.21, $6.13, $5.82, $5.81, $5.72, $5.65, $5.39, $4.86, $5.60, $5.73, $5.54, $5.74, $5.96, $4.72, $5.19, $5.66, $5.63, $5.61, $5.71, $5.49, $5.34, $5.03, $5.28, $5.28, $5.21)

Closed at $3.46, up $.33

ARI announced Q4 2014 (July 31, 2014) earnings on October 29, 2014. Revenues were $8.5 million up slightly from $8.4 million the prior year.  EPS was a profit of $.01 compared to a loss of $.02 last year. ARI’s valuation continued to creep up—to $6.02. Over 90% of their revenues are recurring revenues.

ARI announced another acquisition in October. This one provides software, websites and digital marketing services designed exclusively for dealers, wholesalers, retreaders and manufacturers within the automotive tire and wheel vertical. They have about 600 customers. This deal will add approximately $6 million a year in revenue and positive EBITDA to ARI results. The purchase cost $9.1 million of which $4.2 million was in cash, a $3 million seller note and $1.9 million in stock and a potential earn-out. At 1.5 times sales, this was a reasonable price in our opinion. This should give them about a 15% boost in sales for FY 2015 (started August 1, 2014). They are doing a good job positioning the company to be acquired. Hopefully this will soon happen with a $5+ price like we got for XRS in September.

UP 115%, HOLD, Still a large valuation gap here.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)

Buy price $.27 ask,

Valuation $1.22 (Was $.99, $1.02, $1.05,  $1.07, $1.14, $1.17, $1.34, $1.34, $1.37, $1.36, $1.23,  $.91, $1.21, $.71, $.83, $.88 $.96, $.93, $.75, $.85, $1.57, $1.40, $1.29, $1.38, $1.31, $1.38, $1.29, $1.42, $1.28 $1.13, $1.05, $.82)

Ask price $.38 closed at $.375

John Birbeck announced his departure in October 2014. He was one of the group trying to take CTIG private for $.40 a share. Birbeck will remain a Director of the company. He owns about 7% of CTIG (about 2.3 million shares).

Q2 earnings disclosed on their Form 10Q on 8/14 and a press release!.  Another good quarter. Revenues were $4.1 million versus $3.9 million last year and they reported a $.01 loss, the same as last year. Cash soared to $.17 per share from zero last quarter. Deferred revenues more than doubled from December 31, 2013 to $5.8 million.

Our valuation jumped 23% to $1.22 a share, the highest in over a year.

CTI announced in June that the special committee of the Board of Directors rejected managements $.40 buy-out offer. Then the special committee was promptly disbanded. This company should not be a public company, but we can understand the decision in rejecting a lowball offer. They need to get an investment banker and sell the company. Probably get at least $.75 a share for it from someone.

UP 41%. HOLD