Last week we went 9 up, 6 down and 1 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by INFT, PARL, and ARIS. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +8.6,+14.4% and +32.0% respectively. Since inception we are now 17 stocks up and 4 down (2 of which are down less than 10%).

Last week is long forgotten now as we booked a 8.6% gain last week and are up 14.4% so far in 2007, while the DOW, NASDAQ and the S+P 500 all gained less than 1% last week, and are all now up from 1.2% to 3.2% for the year.

Since inception we have closed out the following positions:

NTCT +44%
ONXS +11% (Buyout offer)
DTLK +41%
CAW +21% (Buyout offer)
IYXI.ob +44% (Buyout offer)
MOBI +47% (Buyout offer-this week)

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

Great week as we got a buy-out on MOBI for a 47% gain and PDLI, DWCH and QADI had big gains.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Down $.03 to $10.90 last week.
This is a great company with great prospects that is executing well. Earnings are out next week on April 19th before the market opens. We expect good sales growth. Bottom line will not be great, but that is good at this point–investing earnings to grow their manufacturing capacity, sales force, installed base of lasers, doctor training and laser capability should lead to big gains ahead.
Now up 2% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $15.92 (was $13.69 $13.73 and $11.86)
Closed at $10.05, up $.76.
No news. But volume continues to be good, along with the price.
Trading at 63% of our valuation.
Up 45% so far. HOLD.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $24.32, up $2.59.
Activist investment firm Third Point LLC, upped their stake by 1.8 million shares, purchased in the $21-$22 range in April. They now own 11.2 million shares or 9.7% of the company. They also wrote a scathing letter to PDL calling for the firing of the CEO. It was pretty nasty. Looks like they are serious about unlocking the value here with over $200 million invested. This however, remains a very volatile stock.
No news last week.
Now up 26%. HOLD.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, Valuation $7.37 (was $7.52, $7.38 and $9.10)
MIVA closed at $4.21, up $.20.
Google made an offer to buy DoubleClick for almost 3X what a private equity firm bought it for in 2005. Maybe we will see some sympathy reaction in the price of MIVA.
Now up 11%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)
Closed at $3.42, up $.53 or 18% for the week.
No news.
Now up 7%. BUY.

Inforte Corp. (INFT-Bought January 13, 2006)
Buy price $.74 (averaed down from $4.11), Valuation $6.13 (was $6.95, $6.86)
Closed down another $.11 at $3.25 last week.
This is getting ridiculous. Cash is now 81% of the market cap.
Has $2.64 per share in cash. Price objective $5.50.
Now down 13%. BUY.

Mobius Management Systems (MOBI-Recommended 11/12/2006)
Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69
Up $2.34 to $9.80 last week.
Buyout offer made at $10.05 per share.
Up 47%. SOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $3.36 (Was $2.69)
Closed down another $.19 at $1.38 last week.
No news.
As we cautioned 2 weeks ago, the fairly quick run up in price made us cautious and sure enough we had two bad weeks here. But at 41% of our valuation, we are buying more here.
Up 38%. BUY.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), NEW Valuation $8.63 (Was $13.77)
PARL closed at $5.77, up $.54 last week.
The good news was that they got their reprieve from the SEC, and then filed the 12/31/2006 10Q on time on Friday. So they are now up to date with the SEC and the delisting appears to old news. The bad news was that their results stunk up the place. Sales were good, up 15% from the prior year and their balance sheet is in much better shape after the Perry Ellis asset sale, but margins fell to 42% from 50% and they had an operating loss of $8 million compared to operating income of $2.6 million in the prior year. Our valuation fell to $8.63. So at 67% of our valuation this is not a buy anymore, but not a sell either. We are still going to hold this one as we suspect that the lousy P+L is the result of the distraction of the proxy contest, so house cleaning of the books, etc. But if margins do not improve, this one may be history for us.
Down 6%. HOLD.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $5.12 (was $5.88).
Closed at $1.89 up $.13 for the week.
No news. Trading at 37% of our valuation.
Up 3%. BUY

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.52
Closed at $13.73 last week, down $.33.
No news.
Up 1%. HOLD

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 $2.02, up $.07 last week.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now down 2%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.57 (was $.62, $.66 and before that-$.79)
Closed at $.23, up $.01 last week.
Now trading at only 40% of our current valuation.
We will give LION another quarter or two to see if they can turn things around. They are still “cheap” compared to our valuation (and unfortunately getting cheaper).
Down 36%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).

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 $1.50, unchanged last week.
Has cash of $.47 per share–31% of the market cap.
Still hoping we will see north of $2.00 this year.
20% gain so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19, Valuation $3.29 (was $2.69, $3.36, $3.81)
Stock closed at $1.46, down $.09.
No news.
Now up 23%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.28 (Was $1.28 $1.13, $1.05, $.82)
Ask price fell $.02 to $.35. Closed at $.34.
This is now trading at only 27% of our latest valuation.
Up 30% based on the ASK price. BUY

Mobius (MOBI) got a buy-out offer this morning for $10.05 a share. SELL at $9.80.

47% gain. Not bad for a “boring” stock.

Last week we went 8 up and 8 down. LINN.ob holds first place on our “biggest dog” list (by far) followed by INFT, PARL, DWCH, ARIS, and BDR. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is (2.95%),+5.8% and +22.1% respectively. Since inception we are 15 stocks up and 6 down (3 of which are down less than 10%).

We paid our dues last week with a 2.95% loss last week and are up 5.8% so far in 2007, while the DOW, NASDAQ and the S+P 500 all surged again last week by 1.6% to 2.1%, and are all now up from .8% to 2.3% for the year.

Since inception we have closed out the following positions:

NTCT +44%
ONXS +11% (Buyout offer)
DTLK +41%
CAW +21% (Buyout offer)
IYXI.ob +44% (Buyout offer)

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

Interesting week. CTIG.ob,BDR and OPTO.ob all announced earnings last week and DWCH had some interesting news.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $.23 to $10.93 last week.
This is a great company with great prospects that is executing well. SPNC picked up a Buy recommendation from SunTrust last week, but the price target was a measley $13. SPNC will be attending a ST conference on April 11th, so hopefully we will see an increase in the price target shortly after that.
Now up 3% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $15.92 (was $13.69 $13.73 and $11.86)
Closed at $9.29, up $.19.
No news. But volume seems to picking up, along with the price.
Trading at 58% of our valuation.
Up 34% so far. BUY.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $21.73, up $.03.
Activist investment firm Third Point LLC, which owns 8 million shares or 7.5% of the company, continues to lurk in the background. We think that PDLI is a bargain at this price. This however, remains a very volatile stock.
No news last week.
Now up 13%. HOLD.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, Valuation $7.37 (was $7.52, $7.38 and $9.10)
MIVA closed at $4.01, up $.17.
No news.
Now up 6%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)
Closed at $2.89, down $.01 for the week.
A 13D was filed on March 28th by Ray Huger the developer of the Monarch software that DWCH sells. He bought 47,000 shares at $2.98 to $3.08 from February 28 to March 22. He now holds 280,800 shares or 5.1%. Maybe he knows something. We bought a little more last week too.
Now down 10%. BUY.

Inforte Corp. (INFT-Bought January 13, 2006)
Buy price $4.11, Valuation $6.13 (was $6.95, $6.86)
Closed down $.13 at $3.36 last week.
No news. Time to double up on this one too–avg. price will be $3.74.
Has $2.64 per share in cash. Price objective $5.50.
Now down 18%. BUY.

Mobius Management Systems (MOBI-Recommended 11/12/2006)
Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69
Up $.11 to $7.46 last week.
No news.
Up 12%. HOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $3.36 (Was $2.69)
Closed down $.19 at $1.57 last week.
No news.
As we cautioned last week, the fairly quick run up in price made us cautious and sure enough we had a bad week here.
Up 57%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.12 (was $6.65 before double up), Valuation $13.77)
PARL closed at $5.23, down $.35 last week.
They are asking the SEC for another extention for their December 31, numbers (Q3)until April 16. Our guess is that they will get it. No news on this last week. We think the stock price will continue to vacillate for a while until they get fully compliant on their filings.
Down 15%. BUY.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, NEW Valuation $5.12 (was $5.88).
Closed at $1.76 down $.19 for the week.
Earnings last week were “OK”. Our valuation fell to $5.12, but our original valuation was based on estimates of all the transactions they were in the middle of. We still like this stock and bought more ourselves last week. Trading at 34% of our valuation.
Down 4%. BUY

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.52
Closed at $14.06 last week, up $.49.
No news.
Up 3%. HOLD

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 $1.95, up $.04 last week.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now down 5%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.57 (was $.62, $.66 and before that-$.79)
Closed at $.22, up $.02 last week.
Now trading at only 39% of our current valuation.
We will give LION another quarter or two to see if they can turn things around. They are still “cheap” compared to our valuation (and unfortunately getting cheaper).
Down 44%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.54 and 2.88)
Closed at $1.50, down $.09 last week.
OPTIO announced earnings last week. They lost $.01 per share (made $.01 for the year) and sales fell 9% from the YOY quarter, but OPTIO has been successfully transitioning from a license sales model to a subscription based model and the entire sales decline was from license sales. Subscription sales and Service sales increased from the prior year. Our valuation stayed the same at $2.89. Cash went up to $.47 per share–31% of the market cap.
Still hoping we will see north of $2.00 this year.
20% gain so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19, Valuation $3.29 (was $2.69, $3.36, $3.81)
Stock closed at $1.55, down $.05.
No news.
Now up 30%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, NEW Valuation $1.28 (Was $1.28 $1.13, $1.05, $.82)
Ask price fell $.02 to $.37. Closed at $.35.
Based of CTIG’s pro-forma numbers (for the Ryder acquisition) our valuation went up to $1.42 per share. Their reported numbers for the quarter and year ended 12/31/2006 really don’t mean much at this point as none of the Ryder income was included.
This is now trading at only 26% of our latest valuation. A screaming BUY.
Up 37% based on the ASK price. BUY

BDR reported Q4 and 2006 year results. About what we expected. Our valuation dropped from $5.88 to $5.12. Our $5.88 valuation was based on estimating the impact of the various transactions BDR did late in 2006 (patent sale, Broadband sale, stock buy-back). Now with the real numbers, our valuation is more solid. Trading at $2.32, BDR is still trading at less than 50% of our valuation (45%). Up 27%. HOLD

CTIG.ob also reported Q4 and 2006 year numbers. The important numbers are in their Form 10K–the pro-forma numbers for the Ryder acquisition. Our new valuation is $1.42, up from $1.28. At $.39 asked, this is still only 27% of our valuation. Up 44% based on ask price. BUY

Last week we went 8 up and 8 down and 1 even. LINN.ob holds first place on our “biggest dog” list (by far) followed by PARL, INFT, DWCH, ARIS, and ILOG. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +2.3%,+8.75% and +25.5% respectively. Since inception we are 15 stocks up and 6 down (3 of which are down less than 10%).

We managed another a 2% gain last week and are up 8.75% so far in 2007, while the DOW, NASDAQ and the S+P 500 all fell last week by 1% to 1.4%, and are all now hovering around breakeven for the year.

We closed out INYX last week and added ILOG.

We are officially “doubling” up on Parlux this week.

Since inception we have closed out the following positions:

NTCT +44%
ONXS +11%
DTLK +41%
CAW +21%
IYXI.ob +44%

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

Interesting week. CTIG.ob perked up, Parlux in moving towards SEC compliance, news on LINN.ob, MIVA and DWCH. RITT bouced back to +76%.

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Down $.03 to $10.70 last week.
This is a great company with great prospects that is executing well–but the stock continues to lag. The shorts, for whatever reason, have been playing this stock for months. When it breaks out–it should be very, very, good.
No news.
Now up .5% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $15.92 (was $13.69 $13.73 and $11.86)
Closed at $9.10, down $.17.
No news.
Trading at 57% of our valuation.
Up 31% so far. BUY.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $21.70, up $1.66.
Activist investment firm Third Point LLC, which owns 8 million shares or 7.5% of the company, continues to lurk in the background. We think that PDLI is a bargain at this price. This however, remains a very volatile stock.
No news last week.
Now up 12%. HOLD.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, NEW Valuation $7.37 (was $7.52, $7.38 and $9.10)
MIVA closed at $3.84, up $.05.
MIVA announced a deal with Conde Nast for a new pay-per-click deal, beating out Google and Yahoo. CN publishes GQ and Vogue among other publications.
Now up 1%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)
Closed at $2.90, down $.05 for the week.
Hired a new CFO, but no impact to the stock price.
Now down 10%. BUY.

Inforte Corp. (INFT-Bought January 13, 2006)
Buy price $4.11, Valuation $6.13 (was $6.95, $6.86)
Closed up $.05 at $3.49 last week.
No news.
Has $2.64 per share in cash. Price objective $5.50.
Now down 15%. HOLD.

Mobius Management Systems (MOBI-Recommended 11/12/2006)
Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69
Up $.12 to $7.35 last week.
No news.
Up 10%. HOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $3.36 (Was $2.69)
Closed up $.06 at $1.76 last week.
No news.
Normally this would still be a “buy”, but with the fast run-up, we are cautious.
Up 76%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.65, Valuation $13.77)
PARL closed at $5.58, down $.41 last week.
Parlux finally filed their September 30, 2006 Form 10Q. This was old news, but at least they are moving towards SEC compliance. They are asking the SEC for another extention for their December 31, numbers (Q3)until April 16. Our guess is that they will get it. We think the stock price will continue to vacillate for a while until they get fully compliant on their filings. We reran our valuation based on the 10Q filing and it is still over $12 (this does not include the Perry Ellis transaction and is based on one of their seasonally weakest quarters), so we are recommending averaging down by doubling up on PARL this week. New average buy price will be $6.12. We will of course update our valuation when they get their Q3, 10Q filed–hopefully by the April 16th date.
Down 16%. BUY.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $5.88.
Closed at $1.95 up $.16 for the week.
Earnings being announced on Tuesday at 11am EST. This could be good.
Up 7%. BUY

ILOG SA (ILOG-recommended 3/26/2007)
Buy price $13.60, Valuation $20.52
Closed at $13.57 last week, down $.03.
No news.
Down .2%. BUY

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 $1.91, down $.19 last week.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now down 7%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.57 (was $.62, $.66 and before that-$.79)
Closed at $.20, down $.02 last week.
Now trading at only 35% of our current valuation.
Lion announced after the close on Friday that their Chairman and CEO resigned. Maybe this is the start of the turnaround. Also 1.1 million shares traded on 3/26. Pretty good for an “illiquid” stock.
We will give LION another quarter or two to see if they can turn things around. They are still “cheap” compared to our valuation (and unfortunately getting cheaper).
Down 44%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.54 and 2.88)
Closed at $1.59, down $.01 last week.
No news. Volume soared to 356,000 on Friday. Has $.44 in cash per share.
Still hoping we will see north of $2.00 this year.
27% gain so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19, Valuation $3.29 (was $2.69, $3.36, $3.81)
Stock closed at $1.60, unchanged.
No news.
Now up 35%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.28 (Was $1.13, $1.05, $.82)
Ask price jumped $.05 to $.39. Closed at $.38.
Volume “soared” to over 200,000 shares last week. Stock actually traded at $.42. Hopefully with the Ryder acquisition, this one will get some attention. Still trading at only 30% of our valuation.
Up 44% based on the ASK price. BUY

INYX Inc. (IYXI.ob-Bought January 3, 2006)
Buy price $1.91, Valuation–over $3.00)
Closed out last week at $2.75.
Up 44% SOLD.

ILOG SA (NASDAQ–ILOG)
Valuation-$20.52
Closing price March 23, 2007-$13.60

Yes, this is a French Company. As usual we have been watching this one for a while. We bought some at this level a few weeks back, just to see it drop into the mid-$12 level right after we bought it. Now it has come back with the overall market rebound. This is as “thin” as they get, but you can buy it if you are patient. As with most “thin” stocks they don’t trade a lot, and then, something happens and they do. We hesitated on recommending another OB stock about the same time we were looking at ILOG because it only traded about 15,000 shares a day. Then it traded over 1 million shares one day and jumped 24%, so we decided to go ahead with ILOG.

ILOG released Q2 results (12/31/2007) on January 25th. Sales were up 27% and they made $.05 net income per share (fully taxed) compared to a loss of $.01 the prior year. They have $3.41 per share in cash, 77% gross margins and are trading at 66% of our valuation. This is at the high end of where we like to recommend our “cheap stocks”, however, this looks more like a growth stock to us. We expect that ILOG’s valuation will increase over the next year and the stock price will too.

ILOG is predicting at least 17% sales growth over fiscal 2006 which should put them in the $155-$160 million sales range for this year (6/30/2007) and increased net income. They made $.35 per share last year, but this was not fully taxed.

There are about 18.6 million fully diluted shares outstanding. ILOG did 50% of its 6/30/2006 revenue in the U.S., 40% in Europe and 10% in Asia/Pacific.

In February, ILOG announced a small acquisition in Chicago, that is expected to close in April. This will help sales growth, increase their U.S. business and only costs $15 million in cash. No details on the sales or profitability of the acquisition have been disclosed yet.

About ILOG

ILOG delivers software and services that empower customers to make better decisions faster and manage change and complexity. Over 2,500 corporations and more than 465 leading software vendors rely on ILOG’s market-leading business rule management system (BRMS), optimization and visualization software components, to achieve dramatic returns on investment, create market-defining products and services, and sharpen their competitive edge. ILOG was founded in 1987 and employs more than 775 people worldwide.

The takeover was announced this morning–$3.01 cash per share. We will not wait for this one to close. Traded at $2.80 most of the morning, $2.72 now. Call it $2.75 for a 44% gain.

Last week we went 7 up and 7 down and 2 even. LINN.ob holds first place on our “biggest dog” list followed by INFT, PARL, DWCH, BDR, and MIVA. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +1.8%,+6.8% and +23.2% respectively. Since inception we are 14 stocks up and 6 down (4 of which are down less than 10%).

We managed almost a 2% gain last week and are up 6.8% so far in 2007, while the DOW, NASDAQ and the S+P 500 all jumped last week by 3%-3.6%, and are now up .2% to 1.7% for the year.

Nothing much in the way of news last week other than INYX. RITT paused last week and is now only up 70%.

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

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Up $.13 to $10.73 last week.
This is a great company with great prospects that is executing well–but the stock continues to lag.
No news.
Now up 1% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, Valuation $15.92 (was $13.69 $13.73 and $11.86)
Closed at $9.27, up $.66.
No news.
Trading at 58% of our valuation.
Up 34% so far. BUY.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $20.04, up $1.32.
Activist investment firm Third Point LLC, which owns 8 million shares or 7.5% of the company, continues to lurk in the background. We think that PDLI is a bargain at this price. This however, remains a very volatile stock.
No real news last week.
Now up 4%. BUY.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, NEW Valuation $7.37 (was $7.52, $7.38 and $9.10)
MIVA closed at $3.79, up $.14.
Now down .3%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)
Closed at $2.95, down $.03 for the week.
No news.
Now down 8%. BUY.

Inforte Corp. (INFT-Bought January 13, 2006)
Buy price $4.11, Valuation $6.13 (was $6.95, $6.86)
Closed unchanged at $3.44 last week.
No news.
Has $2.64 per share in cash. Price objective $5.50.
Now down 16%. HOLD.

Mobius Management Systems (MOBI-Recommended 11/12/2006)
Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69
Down $.13 to $7.23 last week.
No news.
Up 8%. HOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $3.36 (Was $2.69)
Closed down $.07 at $1.70 last week.
No news. RITT finally paused last week. Still trading at only 51% of our valuation.
Normally this would still be a “buy”, but with the fast run-up, we are cautious.
Up 70%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.65, Valuation $13.77)
PARL closed at $5.99, up $.19 last week.
We think the stock price will continue to vacillate for a while until we get some positive news. Even a 10Q filing might cause this one to spike up.
Down 13%. BUY.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $5.88.
Closed at $1.79 down $.01 for the week.
No news.
Down 2%. BUY

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 $2.10, unchanged last week.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now up 2%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.57 (was $.62, $.66 and before that-$.79)
Closed at $.22, down $.02 last week.
Still trading at only 42% of our current valuation. We will give LION another quarter ot two to see if they can turn things around. They are still “cheap” compared to our valuation (and unfortunately getting cheaper).
Down 39%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.54 and 2.88)
Closed at $1.60, up $.16 last week.
No news and volume has dried up. Has $.44 in cash per share.
Still hoping we will see north of $2.00 this year.
28% gain so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19, Valuation $3.29 (was $2.69, $3.36, $3.81)
Stock closed at $1.60, down $.10.
I was wrong last week as the “block” reappeared for sale on Monday, at least 10,000 shares of it.
Now up 35%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.28 (Was $1.13, $1.05, $.82)
Ask price dropped $.01 to $.34. Closed at $.32.
No news.
Up 26% based on the ASK price. BUY

INYX Inc. (IYXI.ob-Bought January 3, 2006)
Buy price $1.91, Valuation–over $3.00)
Closed at $2.60, up $.37 last week.
Still waiting on the “attractive cash offer” that was promised by the end of February. They put out a press release this past Monday saying that they would make the offer by the end of this week. Well, it is late on Friday and nothing yet. Hopefully the offer will come, and it will be attractive by our standards and be at least $3 per share–so we can book a a 50% gain on this one. Bank debt is now scheduled for repayment by March 31, 2007 and they have arranged financing for their latest acquisition.
Up 36% HOLD.

Last week we went 8 up and 6 down and 2 even. LINN.ob holds first place on our “biggest dog” list followed by INFT, PARL, DWCH, MIVA, PDLI, BDR and SPNC. For the week, 2007 year-to-date, and since we started this Blog in January 2006, our model portfolio is +.3%,+4.9% and +21.1% respectively. Since inception we are 12 stocks up and 8 down (5 of which are down less than 10%).

We managed a small gain last week and are up 4.9% so far in 2007, while the DOW, NASDAQ and the S+P 500 are all down 2-3%, and all were down again last week.

Earnings on MIVA and QADI and news on SPNC and PDLI last week. RITT continued to barrel along and is now up 77%.

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

Spectranetics (SPNC-Recommended 9/2/2006)
Buy price $10.65, Valuation $18-$20
Jumped $.89 to $10.60 last week.
SPNC released news that the FDA has allowed them to end their CELLO enrollment (after 61 enrollees instead of the planed 85) early based on good preliminary results. This is terrific news. Is all goes well, we could see some revenue from “above-the-knee” procedures before the end of the year–which is not included in the Company’s projections. They also presented at Citigroup last week. This is a great company with great prospects that is executing well–but the stock continues to lag.
Now down .5% so far. BUY.

QAD Inc. (QADI-Recommended 6/14/2006)
Buy price $6.93, NEW Valuation $15.92 (was $13.69 $13.73 and $11.86)
Closed at $8.61, up $.15.
Trading at 54% of our new valuation of $15.92. Earnings last week were good. Revenues up 11% to $66.5 million and they made $.14 per share. For 2008 they are projecting $254-$266 million in revenue and $.26 to $.36 per share in net income (including $.12 per share for stock compensation expense) Has $1.19 in cash also.
Up 24% so far. BUY.

PDL BioPharma Inc. (PDLI-Recommended 5/21/2006)
Buy price $19.31, Valuation > $30
Closed at $18.72, up $.02.
On March 12th, PDLI “said the ongoing mid-stage trial of daclizumab, a humanized monoclonal antibody, met its main goal in relapsing multiple sclerosis.” This drug is a collaboration with Biogen. The stock got up to $19.55 at one point last week, but then drifted back down to end up only $.02.
Activist investment firm Third Point LLC, which owns 8 million shares or 7.5% of the company, continues to lurk in the background. We think that PDLI is a bargain at this price. This however, remains a very volatile stock.
Now down 3%. BUY.

MIVA Inc. (MIVA-Recommended 3/18/2006)
Buy price $3.80, NEW Valuation $7.37 (was $7.52, $7.38 and $9.10)
MIVA closed at $3.65, down $.34.
Earnings last week were not dazzling. Revenues were up less than 1% from the prior year and they lost $6.2 million. They continue to cut expenses and expect to continue this in Q1 2007. Even so, our valuation did not drop very much, so we will hold the course here for a while longer.
Now down 4%. HOLD.

DataWatch Corp. (DWCH-Recommended 2/12/2006)
Buy price $3.21 (averaged down from $3.66), Valuation $8.32 (was $7.50, $7.63, $9.31)
Closed at $2.98, down $.01 for the week.
No news other than some more executive promotions. Go figure.
Now down 7%. BUY.

Inforte Corp. (INFT-Bought January 13, 2006)
Buy price $4.11, Valuation $6.13 (was $6.95, $6.86)
Down $.08 to $3.44 last week.
No news.
Has $2.64 per share in cash. Price objective $5.50.
Now down 16%. HOLD.

Mobius Management Systems (MOBI-Recommended 11/12/2006)
Buy price $6.68 (averaged down from $7.08), Valuation $12.82, was $12.69
Up $.15 to $7.36 last week.
No news.
Up 10%. HOLD.

RiT Technologies (RITT-Recommended 11/12/2006)
Buy price $1.00, Valuation $3.36 (Was $2.69)
Closed up $.09 at $1.77 last week.
No news. Looks like this one still wants to go higher.
Up 77%. HOLD.

Parlux Fragrances (PARL-Recommended 11/30/2006)
Buy price $6.65, Valuation $13.77)
PARL closed at $5.80, up $.01 last week.
We think the stock price will continue to vacillate for a while until we get some positive news. Even a 10Q filing might cause this one to spike up.
Down 13%. BUY.

Blonder Tongue Laboratories (BDR-Recommended 3/4/2007)
Buy price $1.83, Valuation $5.88.
Closed at $1.80 down $.01 for the week.
No news.
Down 1.6%. BUY

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 $2.10, unchanged last week.
This stock is still illiquid, so price moves are fairly meaningless at this point.
Now up 2%. BUY. Still a Huge valuation gap here.

Lion Inc. (LINN.ob-Recommended 4/15/2006)
Buy price $.36, Valuation $.57 (was $.62, $.66 and before that-$.79)
Closed at $.24, down $.03 last week.
Still trading at only 42% of our current valuation. We will give LION another quarter ot two to see if they can turn things around. They are still “cheap” compared to our valuation.
Down 33%. HOLD until we get some revenue growth and stop losing money (same story as last quarter).

OPTIO Software Inc. (OPTO.ob-Recommended 3/22/2006)
Buy price $1.25, Valuation $2.89 (was $2.54 and 2.88)
Closed at $1.44, down $.11 last week.
No news and volume was light. Has $.44 in cash per share. We have now dropped out of the $1.60-$1.70 range and even below the $1.50 level that took so long to reach. Still hoping we will see north of $2.00 this year.
15% gain so far. HOLD.

Avatech Solutions Inc. (AVSO.ob-Bought November 28, 2005)
Buy price $1.19, Valuation $3.29 (was $2.69, $3.36, $3.81)
Stock closed at $1.70, up $.07.
Looks like the “block overhang” got out of the way last week. Maybe we move higher from here.
Now up 43%. HOLD.

CTI Holdings (CTIG.ob-Recommended 2/25/2006)
Buy price $.27 ask, Valuation $1.28 (Was $1.13, $1.05, $.82)
Ask price stayed at $.35. Closed at $.34.
No news.
Up 30% based on the ASK price. BUY

INYX Inc. (IYXI.ob-Bought January 3, 2006)
Buy price $1.91, Valuation–over $3.00)
Closed at $2.23, up $.04 last week.
Still waiting on the “attractive cash offer” that was promised by the end of February. Hopefully the offer will come, and it will be attractive by our standards and be at least $3 per share–so we can book a a 50% gain on this one. Bank debt is now scheduled for repayment by March 31, 2007 and they have arranged financing for their latest acquisition.
Rumour is that their will be an announcement this Monday. Not holding our breath though.
Up 15% HOLD.

Quick update:

Miva valuation fell to $7.37 from $7.52 (2%). More cost cuts promised in 2007, so maybe this one will turn around over the next quarter or two. Stock has fallen this week, but so has the market. HOLD.

QADI valuation jumped from $13.69 to $15.92–16%, on a very nice quarter. Hopefully the stock will reflect this tomorrow. We like it. BUY.

SPNC–very good news on their CELLO trials. FDA agreed to cut the enrollment group to get the data submitted for approval. Think this will get appoved!! This is very big. Stock rose to $10.56 from $9.88. Should have gone higher in our opinion, but the shorts are STILL playing around. Maybe we will see something from Citibank on an increase in their target price too in ths next couple of days, after their presentation yesterday. BUY.