Arkados Group OTCBB: AKDS $0.40
Research Note
Industry: Electronics & Engineering
Rating: Speculative Buy (Reiterated)
Price Target: $2.00
By: Robert S. Stoklosa
Arkados Announces New Customers: To Exhibit at CES.
January 4, 2007. Arkados Group, Inc. (OTCBB: AKDS) announces several new customers and development partners. Arkados to exhibit new applications at CES (Consumer Electronics Show) in Las Vegas January 8-11, 2007.
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Amarillo Biosciences Inc. OTCBB: AMAR $0.61
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $1.90
By: Wayne M. Lottinville, CFA
Amarillo Biosciences Clinical Trial Enrollment Progresses; Reiterate Speculative Buy
January 5, 2007. Amarillo Biosciences, Inc. (OTCBB: AMAR), said Thursday that enrollment in Turkey for the Company's Behcet's disease study has reached 50 patients. The Company hopes to complete enrollment of 90 patients in its Phase 2 clinical trial using low-dose oral interferon-alpha in the first or second quarter of 2007. Data analysis is expected to begin 12 weeks after the last patient is enrolled. Amarillo Biosciences has also registered five clinical sites in San Francisco, Chicago, New York City, Boston, and Dallas for its Phase 2 clinical trial using low-dose oral interferon-alpha lozenges to treat HIV-positive subjects who have oral warts. Another clinical site in Baltimore is expected to register in the near future, and all sites are expected to begin enrollment this month.
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American Software Inc Nasdaq: AMSWA $7.21
Research Report
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $9.00
By: David P. Soetebier, CFA
American Software Strong Buy Rating In Update Coverage; Leading Supplier Of Supply Chain And Enterprise Management Software
January 8, 2007. American Software (Nasdaq: AMSWA) is a leading supplier of supply chain and enterprise management software. It has an excellent market share position in an area with above-average growth potential. The Company's strong balance sheet allows it to take advantage of growth opportunities either internally or through acquisitions. Financial progress made in recent quarters has been partially hidden by accounting adjustments made for the Demand Management Inc. (DMI) acquisition, other nonrecurring charges at Logility (NasdaqNM: LGTY $7.93), and higher tax rates at American Software and Logility. While we expect favorable revenue growth for fiscal year 2007 (ending April 2007) and higher operating income, the increase in operating income will be partially offset by higher reported taxes at Logility, versus previously being offset by net operating losses in the past. Consequently, the strong operating income improvement we are projecting for Logility in fiscal 2007 will not fully translate into after-tax earnings for the parent company. Fiscal 2008 (April) will be the Company's first "normal" year during which earnings won't be negatively impacted by higher taxes (as they were in the previous year) and other non-recurring items. Because of the confusion in the reported results, we don't believe the stock price has fairly reflected the Company's growth potential. The shares of American Software have a current cash dividend of $0.08 per quarter.
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American Software Inc Nasdaq: AMSWA $7.21
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $9.00
By: David P. Soetebier, CFA
American Software Target Price is $9.00, Not $8.00
January 2, 2007. American Software, Inc. (NasdaqGS: AMSWA): In a Dutton Research Note dated September 12, 2006 we raised our 12-month price target on American Software to $9.00 from $8.00. In Research Notes since that time we have continued the $9.00 target and it remains our target. Unfortunately, the Dutton database did not pick up the raised target on September 12, 2006. We apologise for any confusion caused by this development.
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A.P. Pharma, Inc. Nasdaq: APPA $1.34
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $2.00
By: Stephen L. Handley
AP Pharma Strong Speculative Buy In Update; Pursuing A High Risk/High Reward Strategy; Believe Risks Low and Probability of Success High
January 10, 2007. We are maintaining our Strong Speculative Buy rating for AP Pharma (Nasdaq: APPA), although our previous one-year price target of $3.00 per share now appears to be too ambitious (in view of recent announcements, the stock's current price, and possible dilution from additional equity financing), we have somewhat arbitrarily reduced this target to $2.00. This should, in effect, represent a partial advance to a higher level we would expect once APF530 is commercialized, which we now assume will be in 2009. Its primary focus is on bioerodible systems, either injectable or implantable, that incorporate its proprietary Biochronomer™ technology. Management is now devoting virtually all of the Company's resources to the clinical trials and regulatory documentation in support of the eventual commercialization of its key compound, APF530, which is being developed for the prevention of acute and delayed chemotherapy-induced nausea and vomiting (CINV), where there is an important identifiable need for APF530's therapeutic features. On December 21, management announced that it now believes it will not meet a previously announced target of filing this compound's NDA in 2007. The concentrated focus on APF530 means that management is pursuing a high risk/high reward strategy. We believe that this is the correct move because we judge that the risk of not eventually achieving commercialization of APF530 is very low, while the probability of this compound ultimately achieving great commercial success is quite high.
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Biophan Technologies, Inc. OTCBB: BIPH $0.56
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Biophan Technologies, Inc. To Restate Financials From 11/30/05 Forward; Strong Speculative Buy Rating Reiterated
January 11, 2007. Biophan Technologies, Inc. (OTCBB:BIPH) announced that it is restating financial statements for the quarter ended November 30, 2005, and all subsequent periods in compliance with the FASB FIN 46®. For purposes of consolidation, Biophan will value the assets of MYOTECH at $29.0 million as of November 30, 2005, and subsequent statements will reflect the increased percentage ownership in MYOTECH assets. We reiterate our Strong Speculative Buy rating and our 12-month $2.00 per share price target.
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Biophan Technologies, Inc. OTCBB: BIPH $0.56
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Biophan Technologies, Inc. Announces MYO-VAD Animal Testing; Strong Speculative Buy Rating Reiterated
January 10, 2007. Biophan Technologies, Inc. (OTCBB: BIPH), a developer of medical technology, released today, January 10, 2007, news that it is advancing to the next phase in development of the MYO-VAD™ cardiac support system with its co-developer MYOTECH, LLC whose tooling will be used in animal tests in the first-quarter 2007 to verify product performance. We reiterate our Strong Speculative Buy rating and our 12-month $2.00 per share price target.
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Biophan Technologies, Inc. OTCBB: BIPH $0.56
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Biophan Technologies, Inc. Releases Data From FDA Workshop Defining Measurements of MRI Safety of Medical Implants; Strong Speculative Buy Rating Reiterated
January 8, 2007. Biophan Technologies, Inc. (OTCBB: BIPH), a developer of medical technology, today published a report written with the FDA on their findings from a recent workshop designed to research and define methods for measuring MRI safety of medical implants. With the cessation of tax selling, Biophan's common stock is in an up trend. We reiterate our Strong Speculative Buy Rating and our 12-month $2.00 per share price target.
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Clearant, Inc. OTCBB: CLRI $0.19
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Clearant, Inc. License With Cryolife Cancelled; Direct Distribution Agreements Signed.
January 8, 2007. Clearant, Inc. (OTCBB: CLRI) was notified that Cryolife will terminate its license with the Company effective January 31, 2007 due to the discontinuance of some of Cryolife's orthopedic activities. Cryolife will pay Clearant a $100,000 termination fee, as well as any outstanding royalties. In mid 2006, Clearant introduced a new revenue initiative to directly distribute CLEARANT PROCESS(R) Sterile Implants to surgeons, clinics and hospitals using the Company's own sales force. As a result of this new strategy, we believe that the Clearant's mix will shift, over time, toward more direct distribution revenue. In December, Clearant announced agreements with OR Specialties and JPS Surgical, Inc., leading distributors of orthopedic surgical supplies, to support its direct distribution strategy. These agreements expand Clearant's reach into markets where the Company does not have a direct sales force. We rate Clearant's shares Neutral. Despite the promise of the Company's sterilization technology and the initial success of its new direct distribution strategy, we believe that it is imperative that the Company raise additional capital and that it faces significant near-term financial and operational risk if unable to do so.
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BluePoint Energy Inc. OTCBB: CPEU $3.30
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $5.00
By: Richard W. West, CFA
BluePoint Energy, Inc. Announces Alliance Agreement with Cummins Power Generation;Strong Speculative Buy Reiterated; Raising Price Target
January 3, 2007. Chapeau, Inc., d/b/a BluePoint Energy, Inc. (OTCBB: CPEU), announced the signing of a definitive Strategic Alliance Agreement with Cummins Power Generation, a subsidiary of Cummins Inc. (NYSE:CMI- $118.00). This agreement opens the world market to BluePoint Energy and bodes well for long-term revenue and earnings. We reiterate our rating of Strong Speculative Buy and are raising the 12-month price target to $5.00 per share.
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CardioVascular BioTherapeutics Inc OTCBB: CVBT $1.40
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Richard W. West, CFA
CardioVascular BioTherapeutics; Patent Office Allows Application; Neutral Rating Reiterated
January 9, 2007. CardioVascular BioTherapeutics, Inc. (OTCBB:CVBT) announced that the U.S. Patent and Trademark Office (USPTO) allowed Cardio's patent application entitled, "Method of Producing Biologically Active Human Acidic Fibroblast Growth Factor and its Use in Promoting Angiogenesis."
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Elron Electronic Industries LTD. Nasdaq: ELRN $12.12
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $15.00
By: Barry Raeburn
Elron Electronic Industries: Busy Q4 2006 Foreshadows a Positive 2007
January 4, 2007. Elron Electronic Industries Ltd. (NasdaqGM: ELRN) closed 2006 on a strong note with many value generating events occurring in the 4th quarter. We believe 2007 will be an eventful year for many companies in the Elron group. We expect to see a few exit transactions over the next 12-18 months. These events can prove out the value of the underlying companies within the Elron group and should push the value of Elron's NAV higher, in our view. We maintain our Strong Buy rating and 12-month price target of $15.
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Forgent Networks, Inc. Nasdaq: FORG $1.70
Research Note
Industry: Computers, Technology & Internet
Rating: Speculative Buy (Change)
Price Target: $2.00
By: Richard W. West, CFA
Forgent Reports Notification From NASDAQ; No Longer Facing Delisting; Raising Rating to Speculative Buy and Price Target to $2.00
January 3, 2007. Forgent(TM) Networks (NasdaqGM: FORG) announced that the threat of delisting was removed by NASDAQ due to the stock trading over $1.00 for ten consecutive trading days. Due to several events, we are raising the Rating to Speculative Buy and setting the Price Target at $2.00 per share.
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FX Energy Nasdaq: FXEN $6.02
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $9.00
By: Les W. Childress
FX Energy Experienced Bizarre Trading and Stock Price Action Yesterday
January 11, 2007. FX Energy Inc. (NasdaqGM: FXEN) shares plunged to an intraday low of $4.64 down 24% to close at $5.83 on Wednesday. Year old well data on a dry hole posted in an Internet chat room may have contributed to the sell-off. We do not dismiss the possibility that market manipulation to aid short interest may have occurred. It will be interesting to see if regulatory officials feel the same. We maintain our Speculative Buy rating.
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George Foreman Enterprises Inc. OTCBB: GFMEE $3.45
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $4.00
By: Gerald F. LaKarnafeaux, CFA
George Foreman Enterprises Has Filed an 8K Disclosure that Further Explains Its Late Filing of Its 10Q for the September 2006 Period
January 11, 2007. George Foreman Enterprises, Inc. (OTCBB: GFMEE) has filed an 8K that clarrfies the accounting dispute between its former and new auditing firms. The dispute has caused a delay in the filing of its 10Q for the period ending September 30, 2006.
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Gastar Exploration Ltd. AMEX: GST $1.92
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $6.00
By: Richard R. Wolfe, CFA
Gastar Exploration Announces Another Bossier Drilling Success
January 11, 2007. Gastar Exploration Ltd. (AMEX: GST) announced January 9, 2007 that a its Williams-1 well in Leon County, Texas tested 32 net feet of apparent natural gas pay in three Middle Bossier sands at 17,000 feet.
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HydroGen Corp OTCBB: HYDG $4.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
Hydrogen Corp. Names Manager of Advanced Manufacturing.
January 9, 2007. Hydrogen Corp. (OTCBB: HYDG) named a Manager of Advanced Manufacturing with more than 27 years of chemical engineering and manufacturing experience. This appointment is HydroGen's latest move to strengthen its leadership, including the naming of a new member to the Company's advisory board in November 2006 and of three new outside directors in December 2006. We believe that these additions bring HydroGen significant management, financial, manufacturing and engineering experience, which should be invaluable as the Company expands its manufacturing operations and commercializes its hydrogen technology. We reiterate our Speculative Buy rating on HydroGen's shares.
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HydroGen Corp OTCBB: HYDG $4.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
Hydrogen Corp. Names Three New Directors.
January 3, 2007. Hydrogen Corp. (OTCBB: HYDG) named three new directors whose extensive management and finance experience should, we believe, be invaluable as the Company makes the transition from technology development to commercialization. We reiterate our Speculative Buy rating on HydroGen's shares.
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Hydrogen Power International, Inc. OTCBB: HYDP $1.38
Research Note
Industry: Oil, Gas & Energy
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Hydrogen Power, Inc. Names New Directors and Acting CEO; Plans Divestiture of Non-Hydrogen-Related Holdings.
January 5, 2007. Hydrogen Power, Inc. (OTCBB: HYDP) announced a restructuring including the appointment of four directors and a new acting Chief Executive Officer; the planned conversion of certain of the Company's preferred stock into common stock; and a plan to divest the majority of Hydrogen Power's holdings of FastFunds Financial Corp. stock, to eliminate a related financial obligation, and to transfer three non-hydrogen-related subsidiaries to FastFunds. We believe that this restructuring will result in a more focused Company, allowing Hydrogen Power's management to direct all of its efforts toward developing and commercializing the Company's hydrogen-based technology, and it should result in a less complex financial structure and eliminate some liabilities. We rate Hydrogen Power shares Neutral.
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Internet Gold-Golden Lines Ltd Nasdaq: IGLD $12.11
Research Note
Industry: Computers, Technology & Internet
Rating: Buy (Reiterated)
Price Target: $15.00
By: Rafael K. Kapelinski
Internet Gold: Market Update, Reiterate Buy
January 5, 2007.
Internet Gold - Golden Lines Ltd.'s (NasdaqGM: IGLD) primary competitor, Netvision, received approval yesterday from Israel's Ministry of Communications to merge with Barak ITC -- a fellow ISP and provider of long distance calling services -- as well as with voice-over-Internet company Globecall Communications.
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InkSure Technologies Inc OTCBB: INKS $2.39
Research Note
Industry: Electronics & Engineering
Rating: Speculative Buy (Reiterated)
Price Target: $3.50
By: Rafael K. Kapelinski
Inksure Technologies: Reiterate Speculative Buy, Recent Weakness Unjustfied
January 11, 2007. InkSure Technology Inc.'s (OTCBB: INKS.OB) share price has been udner pressure recently. In our view, there have been no industry or company-specific events that would justify the recent volatility.
The expectation of the Company's winning the Turkish national cigarette stamp tax project has been the single most powerful share price driver in the recent weeks. While the Company is still anticipating the final decision, we believe that Inksure's chances of winning the contract are very strong. According to the Turkish press, Inksure has qualified to the second round along with two other competitors, including SIGPA. However, Inksure's relatively low price, a strong track record in Turkey, and an influential Turkish partner (MTM Security) make us optimistic about the Company's prospects.
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LJ International Inc. NasdaqNM: JADE $4.73
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $5.40
By: Sally H. Wallick, CFA
LJ International Year-End ENZO Store Count of 42 Exceeds Target; On Track For 100 Stores By the Summer of 2008.
January 9, 2007. LJ International Inc.'s (NasdaqGM: JADE) retail division, ENZO, operated a total of 42 stores in Mainland China, Hong Kong and Macau on December 31, 2006. This total exceeded management's year-end target of 40 stores. The Company's longer term goal remains 100 ENZO stores in operation by the time of the Beijing Olympics in the summer of 2008. Based on preliminary results, ENZO achieved positive EBITDA and operating profit for the first time in the fourth quarter of 2006. Previously, management had set a goal of breakeven EBITDA by yearend 2006. By the end of 2007, management expects ENZO to be profitable on a net, stand-alone basis. We rate LJI shares Speculative Buy.
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LJ International Inc. NasdaqNM: JADE $4.73
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $5.40
By: Sally H. Wallick, CFA
LJ International Presentation at Cowen & Co. Consumer Conference: Timely Opportunity to Update Investors on Progress in 2006 and Plans For the Future.
January 8, 2007. LJ International (NasdaqGM: JADE) designs, manufactures, distributes and markets a full range of fine jewelry and operates a rapidly growing chain of retail jewelry stores in China. LJI's Vice President, Sales and Marketing, Danie Tangchai, and Haris Tajyar, Managing Partner of Investor Relations International, will make a presentation at the Cowen & Co. 5th Annual Consumer Conference on Wednesday, January 10. The presentation is scheduled for 2 p.m. (EST) and will be Webcast live. We believe that this presentation will be a timely opportunity for an update on the Company's progress in 2006 and its plans for the future. Last year was highlighted by rapid expansion of the ENZO retail chain in China, improved retail sales performance and continued solid growth at the wholesale division. We rate LJI's shares Speculative Buy.
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Lime Energy Co. OTCBB: LMEC $0.91
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Lime Energy Co. Announces Participation in Utah's HVAC Energy Efficiency Alliance; Reiterate Strong Speculative Buy Rating
January 10, 2007. On January 10, 2007, Lime Energy Co. (OTCBB:LMEC) announced that Pacific Corp's Rocky Mountain Power had chosen Lime Energy's operating companies, Parke Industries and Maximum Performance Group (MPG), to participate in Rocky Mountain's energy efficiency program. We reiterate our Speculative Buy Rating and our 12-month price target of $2.00 per share. Lime Energy Co.
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LESCO, Inc. NasdaqNM: LSCO $10.06
Research Note
Industry: Consumer & Retail Products
Rating: Neutral (Reiterated)
By: Paul J. Resnik, CFA
LESCO Announces Amendment in Credit Facility Terms; Rating Remains Neutral
January 5, 2007. January 5, 2007 Yesterday, LESCO Inc. (NasdaqGM: LSCO) reported that, on December 28, 2006, it entered into an amendment of its $55 million revolving credit and security agreement. We view the amendment in the credit facility as a reflection of the previously announced change in the Company's early order program rather than an indication of any shortfall in overall business. With regard to that business, we would note that a continuation of unseasonably warm winter weather could have a negative effect on ice melt sales this year, as it did last year. While the warm weather could shift some fertilizer and seed sales from the second quarter to the first quarter, as it did last year, it is not believed to have had any meaningful effect on 4Q 2006 sales. Despite our view that LESCO's unique service center system is attractively priced at the Company's current market capitalization, we continue to rate the stock Neutral pending signs of renewed momentum for sales growth and a clearer idea of the timing of a return to full year profitability.
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Maine & Maritimes Corporation AMEX: MAM $15.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $20.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation: Share Ownership by Outside Directors Increases
January 9, 2007. Maine & Maritimes Corporation (AMEX: MAM): A portion of Maine & Maritimes' outside directors' fees is paid in the Company's shares. We view this program positively since it provides these directors with a steadily growing equity interest in the Company. Maine & Maritimes Corporation is a holding company for Maine Public Service Company, a regulated electric transmission and distribution utility, and unregulated businesses. We reiterate out Speculative Buy rating on Maine & Maritimes common.
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Maine & Maritimes Corporation AMEX: MAM $15.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $20.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation Could Benefit From Growing Demand For Green Buildings.
January 3, 2007. Maine & Maritimes Corporation (AMEX: MAM): A recent article in Barron's discusses a shift in real estate markets toward "green" buildings and notes that a growing number of leading corporations and professional services companies are choosing green buildings. The advantages of green buildings are numerous, including lower operating costs and a more comfortable and healthier work environment. Also, construction costs are no higher for green buildings, while they generate higher rents and asset values and enjoy higher occupancy rates. Maine & Maritimes could be a long-term beneficiary of the shift to green buildings, since The Maricor Group (TMG), its professional engineering services and solutions business, focuses on sustainable solutions involving lifecycle asset management, energy efficiency, alternative energy sources, water conservation, and more effective asset management aimed at extending and renewing a facility's life. While Maine & Maritimes seems well positioned to take advantage of growing demand for green buildings, its long-term business strategy is uncertain at present since its Board of Directors has put the Company's aggressive growth strategy of recent years (which included diversification into unregulated businesses such as TMG) on hold, while it reviews strategic options and evaluates the Company's product and service mix, corporate structure, diversification strategy and operational objectives. We reiterate out Speculative Buy rating on Maine & Maritimes common stock, which is trading at nearly a 50% discount to book value per share. On the other hand, we consider the stock speculative at present because of above-average uncertainties that characterize the Company's near-term and long-term outlooks given the unexpected resignation of its Chief Executive Officer in the third quarter of 2006 and the Board's ongoing review of the Company's strategic direction at present.
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Midway Gold Corp. TSE-V: MDW $2.63
Research Note
Industry: Metals & Mining
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.75
By: Mike Niehuser
Midway Gold Expanding Spring Valley Gold Discovery in Nevada
January 11, 2007. Midway Gold Corp. (TSX Venture: MDW) announced additional drill results at its Spring Valley project near Lovelock, Nevada. The company completed 90 holes of about 20,300 meters in 2006 and plans a similar program in 2007. Of holes assayed, 68 of 72 contained gold mineralization, which may significantly expand the resource which is presently open along strike and depth. Midway has nine additional targets in this 38 km land package. We reiterate our Strong Speculative Buy rating.
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Midway Gold Corp. TSE-V: MDW $2.63
Research Note
Industry: Metals & Mining
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.75
By: Mike Niehuser
Midway Gold Corp. Rating Upgraded to Speculative Strong Buy
January 8, 2007. We have upgraded our rating for Midway Gold Corp. (TSX Venture: MDW) to Strong Speculative Buy from Speculative Buy. The upgrade follows our recent trip to Nevada and opportunity to discuss the company's recently announced acquisition of Pan-Nevada Gold Corporation (TSX Venture: PNV) with management of both companies. The combination of the two companies appears to result in a value greater than the sum of its parts.
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MediciNova, Inc. NasdaqGM: MNOV $13.01
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $20.00
By: Wayne M. Lottinville, CFA
MediciNova Launches Tokyo Subsidiary; Reiterate Strong Speculative Buy
January 5, 2007. MediciNova, Inc. (Nasdaq: MNOV), has launched MediciNova Japan, Inc., a wholly owned subsidiary. The purpose of this new subsidiary, the Company said in a press release, is to strengthen business development and investor and public relations activities in Japan and other Asian countries. Before MediciNova began trading on the Nasdaq last month, shares were already listed on the Hercules Market of the Osaka Securities Exchange (Ticker: 4875) and continue to trade there. MediciNova currently has four ongoing partnerships with Japanese pharmaceutical companies.
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Memry Corporation AMEX: MRY $2.19
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Memry Corporation: Healthinvest Partners AB of Sweden Takes 5% Position in Memry Shares.
January 8, 2007. Memry Corporation (OTCBB: MRY): Healthinvest Partners AB of Sweden filed a 13G with the Securities and Exchange Commission on January 3, 2007 revealing that it owns approximately 5% of Memry common stock. Healthinvest Partners AB manages the Healthinvest Global Long/Short Fund, which invests in healthcare companies in the pharmaceutical, medical technology, biotechnology and healthcare services sectors. Since late November, the company has filed 13Gs revealing holdings of 5% or more in a number of healthcare companies in addition to Memry, including Bio-Imaging Technologies, Allion Healthcare, Arrhythmia Research, Enpath Medical, and IntegraMed America. We rate Memry's shares Neutral.
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National Coal Corporation Nasdaq: NCOC $5.10
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $13.00
By: Richard R. Wolfe, CFA
National Coal Calls Off West Virginia Acquisition; Impact on Growth
January 9, 2007. National Coal Corp. (NasdaqGM: NCOC) announced on January 8, 2007 that it has terminated discussions to purchase a surface mining operation in West Virginia, a development that will have a substantial near-term impact on our forecast of the Company's rate of growth of assets and sales.
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O2Diesel Corp AMEX: OTD $0.88
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $2.25
By: Sally H. Wallick, CFA
O2Diesel Corporation Receives $1 million Department of Defense Funding for 2007 to Continue Existing Demonstration Projects.
January 3, 2007. O2Diesel Corporation (AMEX: OTD) received an additional $1 million of Department of Defense (DoD) funding for 2007 to continue existing demonstration projects. The funds will support the ongoing Nellis Air Quality Improvement Project, whose aim is to advance O2Diesel's ethanol/diesel blended fuel as a renewable alternative diesel fuel for the U.S. military. Also, the DoD has contracted with O2Diesel to develop a new fuel consisting of at least 20% renewable sources in order to meet air quality compliance requirements and reduce petroleum use. We rate O2Diesel common Speculative Buy.
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On Track Innovations Ltd. Nasdaq: OTIV $7.11
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $12.00
By: Rafael K. Kapelinski
On-Track Innovations (OTIV): Company Update, Reiterate Strong Buy
January 11, 2007. On TrackInnovations Ltd. (NasdaqGM: OTIV) remains a Strong Buy with a price target of $12.00 following our recent comprehensive Company update. In our view the market remains overly pessimistic about the Company's 2007E prospects, especially since the news flow about the contactless migration continues to be positive.
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On Track Innovations Ltd. Nasdaq: OTIV $7.11
Research Report
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $12.00
By: Rafael K. Kapelinski
On Track Innovations Strong Buy Rating And Price Target Of $12; In The Sweet Spot Of The Smart Card Market
January 8, 2007. We reiterate On Track Innovations' (Nasdaq: OTIV) Strong Buy rating and price target of $12.00 following both the 3Q 2006 results and recent acquisition of SuperCom's main assets. In our view, the recent decline in the share price primarily reflects concerns about the marked decline in the number of contactless cards issued by banks and credit card companies. We would like to argue that the slowdown is temporary and we should be seeing a marked acceleration in the speed of contactless card rollouts in 2007E. National IDs and passports are areas of massive implementations, where places like the United States, China and Europe have sufficiently large populations to generate demand for contactless technology in the long term. Also, we believe that the fast speed of the ongoing infrastructure rollouts bode well for the long-term secular growth of the market.
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PacificHealth Laboratories Inc. OTCBB: PHLI $1.40
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $2.00
By: Jonathan H. Ziegler, CFA
Pacific Health Labs Advises of Private Stock Transaction
January 11, 2007. Pacific Health Laboratories, Inc. (OTCBB: PHLI) disclosed that Hormel Health Labs, LLC has sold all of its 909,091 shares in a private transaction, of which approximately one-third were purchased by insiders. We continue to rate these shares a Specualtive Buy.
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Provectus Pharmaceuticals Inc OTCBB: PVCT $1.19
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.90
By: Wayne M. Lottinville, CFA
Provectus Receives Orphan Drug Designation from FDA for Anti-Cancer Agent PV-10 for the Treatment Of Metastatic Melanoma; Reiterate Strong Speculative Buy
January 8, 2007. Provectus Pharmaceuticals, Inc. (OTCBB: PVCT), announced that its leading anti-cancer agent, PV-10, has received orphan drug designation by the FDA for the treatment of metastatic melanoma. Provectus is nearing completion of its 20-subject Phase 1 clinical study of the safety and efficacy of PV-10, an injectable formulation of Rose Bengal also known as Provecta™, for the ablation of metastatic melanoma, an aggressive and often fatal form of skin cancer. Provectus expects to commence a pivotal Phase 2/3 study of the efficacy of PV-10 in the treatment of metastatic melanoma shortly thereafter.
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Quest Oil Corporation OTCBB: QOIL $0.03
Research Note
Industry: Oil, Gas & Energy
Rating: Avoid (Reiterated)
Price Target: N/A
By: Richard R. Wolfe, CFA
Quest Oil Corp: Termination of Coverage
January 8, 2007. We are terminating our coverage of Quest Oil Corp due to the absence of current financial information and the Company's impending delisting from Nasdaq. In particular, in an SEC 8-K filing on December 21, 2006, Quest cited a "Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard" which is the basis for our decision to terminate coverage.
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SES Solar Inc. OTCBB: SESI $0.93
Research Note
Industry: Industrial & Manufacturing
Rating: Speculative Buy (Reiterated)
Price Target: $2.10
By: Sally H. Wallick, CFA
SES Solar Inc.: Solar Stock Performance Mixed in 2006
January 5, 2007. SES Solar Inc. (OTCBB: SESI): Share prices of seven producers of solar energy products declined an average of 12% in 2006, versus a 14% increase in the S&P 500. Individual stock performance was mixed, ranging from a 25% increase in Suntech Power's share price to a 60% decline in DayStar Technologies' price. Despite the stocks' mixed performance and overall underperformance relative to the market, several solar companies completed initial public offerings in the final two months of the year, suggesting that investor interest in solar companies' shares remains high. IPO activity may continue in 2007 as a number of solar companies are rumored to be considering IPOs. SES Solar produces and installs solar energy (photovoltaic or PV) products, including PV modules and roof tiles. We believe that the Company is well positioned to benefit from growing demand for solar energy in Europe and worldwide once it consolidates production a new plant to be constructed near Geneva Switzerland. We rate SES Solar shares Speculative Buy.
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SES Solar Inc. OTCBB: SESI $0.93
Research Note
Industry: Industrial & Manufacturing
Rating: Speculative Buy (Reiterated)
Price Target: $2.10
By: Sally H. Wallick, CFA
SES Solar Inc. Announces Construction Loans For New Plant.
January 3, 2007. SES Solar Inc. (OTCBB: SESI) announced receipt of two construction loans, one for approximately $3.9 million from Banque Cantonale de Geneve and another for approximately $2.2 million from Ms. Christiane Erne, one of the Company's principal stockholders. In November, SES said that it had received subscriptions for a $3.7 million private placement. Proceeds from these financings will be used for the construction of a new state-of-the-art manufacturing facility in Geneva Canton, Switzerland. This highly automated facility will incorporate new assembly technology that should result in higher quality products, improved productivity and lower costs. We believe that SES is well positioned to benefit from soaring demand for solar energy in Europe and worldwide once it consolidates production in the new plant. We rate SES Solar shares Speculative Buy. For more detailed information on the Company, please see the Dutton Associates report dated October 16, 2006.
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Shumate Industries, Inc. OTCBB: SHMT $2.15
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.00
By: Richard R. Wolfe, CFA
Shumate Announces Progress with High-End Valve Application; Appoints Prominent New Director
January 11, 2007. Shumate Industries Inc.'s dual announcements of January 11, 2007 amount to another strong indication of momentum building behind its new valve technology. The Company disclosed that Phase I of its high-end valve development agreement with At Balance Americas, LLC has concluded. In addition, Frank Jungers, retired chairman and CEO of ARAMCO, has been added to Shumate's Board of Directors.
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Apex Silver Mines Ltd AMEX: SIL $13.33
Research Note
Industry: Metals & Mining
Rating: Neutral (Reiterated)
By: Mike Niehuser
Apex Silver Mines impacted by Bolivian Mining Minister's Comments
January 11, 2007. Apex Silver Mines Limited (AMEX: SIL) was impacted by comments by the Bolivian Mining Minister. He expressed a desire for a six-fold increase in taxes on mining companies, which rattled investors. The comments appeared to be political in nature to set the stage for negotiating a solution with workers, the government, and foreign companies to provide reform and stability for the nation's economy.
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Sky Petroleum, Incorporated OTCBB: SKPI $0.70
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.35
By: Richard R. Wolfe, CFA
Sky Petroleum: Second Lifting for H2 Well Production; Further Delay in Arrival of Jackup Rig
January 10, 2007. On January 9, 2007, Sky Petroleum Inc. (OTCBB: SKPI) announced two key developments, the first being the second lifting of volumes attributable to the Company's new H-2 well in Crescent Petroleum's Mubarek Field offshore Dubai, and the second being the news of a further and somewhat more lengthy delay of the spud date for the Company's second Mubarek well, designated K2-ST3.
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Sunwin International Neutraceuticals, Inc. OTCBB: SUWN $0.64
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $1.10
By: Stanley Ng
Sunwin International Neutraceuticals Doubles Stevia Production Capacity With Completion of New Manufacturing Facilities; Reiterate Speculative Buy Rating
January 10, 2007. Sunwin International Neutraceuticals (OTCBB: SUWN.OB) announced on January 9, 2007 that it has completed construction of its new stevia manufacturing facilities. The new facilities are capable of producing an additional 300 tons of premium Stevia per year. We reiterate our price target of $1.10 and Speculative Buy rating on the stock.
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Sunwin International Neutraceuticals, Inc. OTCBB: SUWN $0.64
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $1.10
By: Stanley Ng
Sunwin International Neutraceuticals Speculative Buy Maintained; Believe The Worst Is Over For Sunwin; Possible Surprise On The Upside
January 3, 2007. Sunwin International Neutraceuticals (OTCBB: SUWN) recently announced its results for the six months ended October 31, 2006, which were quite disappointing. Due to the expected weaker sales for both Chinese medicine products and natural sweeteners going forward; delayed completion of the Company's new premium stevia production plant; and the rising cost of raw materials and operating expenses as a percentage of sales, which will put pressure on margins, we have substantially revised downward our revenue and net income projections for FY2007 and FY2008. On the positive side, Sunwin remains an industry leader in low-calorie natural sweetener, TCM-formula extracts for human and animals, veterinary medicines and animal-feed additives. We believe the capital expenditure and progress made on expanding its distribution network for stevia products and Chinese medicines in North America should provide a solid foundation for Sunwin to capture ample growth opportunity in FY2008 with a possible surprise on the upside. We believe the worst is over for Sunwin and the Company's revenue and net income will continue to experience a steady recovery in the coming quarters.
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American Telecom Services, Inc. AMEX: TES $3.85
Research Note
Industry: Telecommunications
Rating: Strong Speculative Buy (Reiterated)
Price Target: $9.00
By: Joe Noel
American Telecom Services Today Announced More Than 30 New Handset Products at CES; Reiterating Strong Speculative Buy Rating
January 8, 2007. American Telecom Services Inc. (AMEX: TES) announced more than 30 new telephone handset products prepackaged with prepaid long-distance and voice over IP services at the consumer electronics trade show which starts today in Las Vegas. We reiterate our Strong Speculative Buy rating on the shares. We are expecting a strong December Quarter to be reported soon.
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Top Image Systems Ltd Nasdaq: TISA $3.63
Research Note
Industry: Software
Rating: Buy (Reiterated)
Price Target: $5.00
By: Rafael K. Kapelinski
Top Image Systems: Update on the Strategy in Japan, Reiterate Buy and Price Target of $5.00.
January 9, 2007. Top Image Systems Ltd. (NasdaqCM: TISA) should experience significant upside in 2007E, in our view. This is expected to come from Japan, where the Company is making steady progress in increasing the software sales content and winning new customers. We estimate Japan's contribution to 2007E revenues at approximately $5-$6 million.
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Telkonet Inc AMEX: TKO $2.95
Research Note
Industry: Telecommunications
Rating: Strong Speculative Buy (Reiterated)
Price Target: $5.00
By: Richard W. West, CFA
Telkonet, Inc. to Begin Deploying Broadband Network Access for Department of the Navy; Reiterate Strong Speculative Buy
January 10, 2007. Telkonet, Inc. (AMEX:TKO) will begin deploying its government-certified Telkonet iWire System for use by the Department of the Navy (DoN) later this month. Telkonet's revenue should begin to ramp up during the balance of 2007 and on into 2008. After six months of testing and evaluation, the DoN certified Telkonet's system for use across the 500,000-user Navy Marine Corps Intranet (NMCI) enterprise environment. We reiterate our Strong Speculative Buy and the recently set 12-month price target of $5.00 per share.
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Telkonet Inc AMEX: TKO $2.95
Research Note
Industry: Telecommunications
Rating: Strong Speculative Buy (Reiterated)
Price Target: $5.00
By: Richard W. West, CFA
Telkonet, Inc. Announces Contract With U.S. Patent Office; Strong Speculative Buy Reiterated
January 8, 2007. Telkonet, Inc. (AMEX:TKO) announced a $200,000 contract with the United States Patent and Trade Office (USPTO) to support the USPTO with the enhancement and upgrade of Telkonet's IT infrastructure and related networking apparatus. Telkonet is increasing penetration into the U.S. Government, as evidenced by the contract with the USPTO. We reiterate our Strong Speculative Buy and the recently set 12-month price target of $5.00 per share.
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XAAR Plc LSE: XAR $4.59
Research Note
Industry: Computers, Technology & Internet
Rating: Buy (Change)
Price Target: $6.15
By: Rafael K. Kapelinski
Xaar is Being Downgraded to Buy on Share Price Strength
January 9, 2007. We downgrade Xaar Plc (LSE: XAR) from Strong Buy to Buy on the recent strength in the share price. At the same time we maintain our price target of $6.15, which leaves 26% upside from the current levels. The recently published positive trading update confirmed that the Chinese woes were over and the Company was on track to either meet or beat consensus estimates.
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Information, opinions or recommendations contained in this research report or research note are submitted solely for advisory and information purposes. The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Such information and the opinions expressed are subject to change without notice. This research report or note is not intended as an offering or a solicitation of an offer to buy or sell the securities mentioned or discussed. Neither the Firm, its principals, nor the assigned analysts own or trade shares of any company covered. The Firm does not accept any equity compensation. Anyone may enroll a company for research coverage, which currently costs US $39,500 prepaid for one-year. Reports are performed on behalf of the public, and are not a service to any company. The analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests and insure independence. Please read full disclosure and other reports and notes on the Company at www.DuttonAssociates.com.
The views expressed in this research report or note accurately reflect the analyst's personal views about the subject securities or issuer. Neither the analyst's compensation nor the compensation received by Dutton Associates is in any way related to the specific recommendations or views contained in this research report or note.
Dutton Associates. John M. Dutton, President, 4989 Golden Foothill Parkway, Suite 4, El Dorado Hills, CA 95762 Phone (916) 941-8119, Fax (916) 941-8093
© Copyright 2006 by Dutton Associates
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