Ampex Corporation Nasdaq: AMPX $17.38
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
Ampex Corporation Announces Release Date for FY2006 Results and Conference Call Info;We Preview the Numbers;Strong Buy Rating Reiterated
March 15, 2007. Ampex Corporation (NasdaqCM: AMPX) announced on March 15, 2007, their year-end FY2006 results will be released after the markets close on Wednesday March 21, 2007. Our estimate for the fourth quarter is a loss of $(0.18) per share on revenue of $8.9 million. For the year, we are estimating total revenue of $38.0 million and a loss per diluted share of $(0.96). We reiterate our Strong Buy Rating and affirm our 12-month price target of $35.00 per share.
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Ampex Corporation Nasdaq: AMPX $17.38
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
Ampex Corporation Announces New Board Member;Strong Buy Rating Reiterated
March 10, 2007. Ampex Corporation (NasdaqGM:AMPX) announced the appointment Dr. Alain C. Briancon as a member of the board of directors. This appointment comes after the February 16th appointment of D. Gordon Strickland as Ampexs new CEO and president, and Ned Goldstein, Esq., joining Ampexs board of directors. We reiterate our Strong Buy and our current price target of $35.00 per share
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American Software Inc Nasdaq: AMSWA $7.50
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $9.00
By: David P. Soetebier, CFA
American Software Reports 40% Increase In Operating Earnings
March 15, 2007. American Software Inc.'s (NasdaqGS: AMSWA) operating income, at $2.96 million for its January 2007 quarter, was sharply above the $2.46 million we had been estimating. Key variations versus our estimate included much stronger performance from the New Generation Computing Group (NGC) and the AMSWA Legacy ERP software business, a greater contribution from Logility (88% owned) and higher Other income. NGC along with the ERP business reported software sales of $1.8 million compared with our estimate of $900,000 (Note: gross margins can be 90% in this business). These two businesses have been relatively flat in recent periods so this improvement was a nice change. Net income at Logility (NasdaqGM: LGTY $7.58) exceeded our estimate by about $600,000. Other income at AMSWA, at $1.4 million, was also sharply above our estimate of $508,000. The higher software sales and Other income contributed to earnings per share of $0.10 versus our estimate of $0.07. Year ago earnings were $0.08 per share. Based on the better results we have raised our estimate for the April 2007 fiscal year to $0.29 from $0.26. Our Rating remains Strong Buy with a 12-month price target of $9.00.
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Biophan Technologies, Inc. OTCBB: BIPH $0.37
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Change)
By: Richard W. West, CFA
Biophan Appoints Bonnie Labosky to its Board of Directors;Neutral Rating Reiterated
March 12, 2007. Biophan Technologies, Inc. (OTCBB:BIPH), a developer of biomedical technology, appointed Bonnie Labosky to its Board of Directors. Ms. Labosky was a former Medtronic Vice President and ran Medtronic's Heart Failure division, which today is a $1.6 billion product category for the medical device company. We believe that Biophans MRI technologies and the MYOTECH MYO-VAD technology will, given time, provide Biophan revenue and earnings. However, during this period of limbo for Biophans finances, we reiterate our Neutral Rating.
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Baldwin Technology Company Inc AMEX: BLD $5.00
Research Note
Industry: Industrial & Manufacturing
Rating: Buy (Reiterated)
Price Target: $6.85
By: Wayne M. Lottinville, CFA
Baldwin Names John Jordan To CFO Post; Reiterate Buy
March 9, 2007. Baldwin Technology Company, Inc. (Amex: BLD), has named John Jordan to the recently vacated post of vice president, chief financial officer, and treasurer. Mr. Jordan was previously at Paxar Corporation, a global apparel identification manufacturer, where he served as vice president and treasurer. He also participated in an eleven-member Paxar Global Leadership Team and led that company's initiatives to comply with Sarbanes-Oxley and to restructure Paxar's domestic operations. Jordan began his business career with Arthur Andersen & Co.
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CHINA-BIOTICS, INC. OTCBB: CHBT $11.50
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Change)
Price Target: $16.60
By: Stanley Ng
China-Biotics Raised To Strong Speculative Buy In Update Coverage; Driven By The Increasing Awareness Of Preventive Health
March 8, 2007. China Biotics (OTCBB: CHBT) is principally engaged in the research, development, production, marketing and distribution of probiotics products. These products contain live microbial food supplements, which beneficially affect the host by improving its intestinal microbial balance and have been approved for sale in China by The Ministry of Health in China. The Company recently announced its third quarter results for the period ended December 31, 2006, with revenue increased by 31.2% year-over-year to a record level of $8.8 million and quarterly net income up 23.1% year-over-year to a new high of $3.6 million. The nine months results ended December 31, 2006 were a hefty 47.6% year-over-year increase in revenue to $22.2 million and a 32.7% YOY rise in net income to $8.1 million. These figures were ahead of our expectations. In our view, China Biotics offers investors a good opportunity to participate in China's fast growing probiotics industry, which is driven by the increasing awareness of preventive health and the sustaining increase in consumption of dairy products with probiotics additives like yogurts and milk powders. EPS is expected to reach $0.66 in FY2007, increase 25.8% to $0.83 in FY2008 and surge 186.7% to $2.38 in FY2009, as the bulk additives products from the new facility begin to contribute. We believe it is appropriate to apply a more aggressive P/E in our valuation of the stock. Based on a target FY2008 P/E of 20 times, our new target price is $16.60 per share. We are upgrading our rating on the stock to Strong Speculative Buy.
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Clearant, Inc. OTCBB: CLRI $0.17
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Clearant, Inc.: 10-K Filing Could Be Delayed.
March 16, 2007. Clearant, Inc. (OTCBB: CLRI): Although Clearant's 10-K is due to be filed by the end of March, we believe that the filing could be delayed while the Company continues efforts to raise much needed capital. As discussed in previous comments, we believe that it is imperative that Clearant raise additional capital for working capital purposes and to fund its growth strategies and that it faces significant financial and operational risk if unable to do so. Our rating on these high-risk shares remains Neutral.
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Deli Solar (USA), Inc., OTCBB: DLSL $2.60
Research Report
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Change)
Price Target: $3.00
By: Paul J. Resnik, CFA
Deli Solar (USA) Speculative Buy Rating In Update Coverage; Products For Households In The People's Republic of China
March 1, 2007. Deli Solar USA Inc. (OTCBB: DLSL) produces solar water heaters and coal-fired boilers, and manufactures and designs space heating products, which are mostly used by the households in the People's Republic of China (PRC). Through its subsidiaries, the Company produces solar water heaters and coal-fired boilers, and manufactures and designs space heating products, which are mostly used in residences in the People's Republic of China (PRC). Deli Solar's solar water heating business (SWH), the Company's major revenue earner (68% of the total revenue), is divided into three segments: Regular Evacuated Tubular SWH, Evacuated Heat Pipe SWH, and Flat Plate SWH. The Company is in the process of strengthening its core business by acquiring a controlling stake (60%) in Shenzhen Xiongri Co., a solar water heater manufacturer based in Shenzhen. Deli Solar operates in the promising renewable energy segment where industry sales of solar water heaters in the Chinese market reached 12 million m2 in 2004, making China the world's biggest market for the product. We expect Deli Solar's sales for FY06 to be USD$22 million, up 44% compared to the sales reported in FY05. We are projecting an EPS of $0.25 in FY07 and an average EPS growth of 60% over 2007-2009. Since the Company is operating in a competitive and a fragmented market, we assume a conservative forward P/E of 12, and our target price of $3.00 per share.
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DXP Enterprises Inc Nasdaq: DXPE $33.00
Research Note
Industry: Industrial & Manufacturing
Rating: Strong Buy (Reiterated)
Price Target: $50.00
By: Paul J. Resnik, CFA
DXP Enterprises Reports Strong Fourth Quarter Results in Line With Dutton Associates Estimate; Stock Advances Over 10% in Late Trading; Reiterate $50 Price Target and Strong Buy Recommendation
March 16, 2007. DXP Enterprises' (Nasdaq: DXPE) fourth quarter 2006 sales increased 45.0% to $79.4 million from $54.7 million in the year-earlier period. We consider this figure in line with our aggressive estimate of $80.2 million. Net income rose 68.1% to $3.49 million, with diluted earnings per share of $0.61 compared to net income of $2.08 million and diluted earnings per share of $0.36 for the fourth quarter of 2005. Other income of $413,000, which reflected the forced sale of a building to the State of Texas for road construction purposes, added $0.04 per share to earnings. Eliminating this sum, earnings per share came in at $0.57, matching our estimate. We are fine-tuning our 2007 sales estimate down from $347.7 million to $346.5 million but maintaining our 2007 EPS estimate at $2.73. Looking out to 2008, we are initiating preliminary estimates of sales of $416 million and EPS of $3.60. Given current general market valuation trends, we are reducing our targeted price/earnings multiple for DXP shares from 18 to 17. Based on projected EPS over the 12 months of $2.97, we are maintaining our 12-month price target of $50 and our rating of Strong Buy for these shares.
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DXP Enterprises Inc Nasdaq: DXPE $33.00
Research Note
Industry: Industrial & Manufacturing
Rating: Strong Buy (Reiterated)
Price Target: $50.00
By: Paul J. Resnik, CFA
DXP Enterprises to Host First Conference Call Following Release of 2006 Results; Reiterate Strong Buy Rating
March 11, 2007. DXP Enterprises, Inc. (Nasdaq: DXPE) plans to issue a press release announcing its 2006 financial results at 4:00 P.M. Eastern Time on Thursday, March 15, 2007 and to host a conference call to be web cast live on the Company's website (www.dxpe.com) at 5:00 p.m. Eastern Time that same day. We would note that this is the first time that DXP will host a conference call, and we view this decision as a constructive development. We reiterate our Strong Buy recommendation and our 12-month price target of $50.
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Evolution Petroleum Corporation AMEX: EPM $2.80
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Buy (Reiterated)
Price Target: $4.67
By: Richard R. Wolfe, CFA
Evolution Petroleum: Reports Second-Quarter Results of $0.02 Loss vs. Our Breakeven Estimate
March 11, 2007. Evolution Petroleum Corp. (AMEX: EPM) reported a net loss for its second fiscal quarter ended December 31 of approximately $422,000 or $0.02 per share compared to our estimate of a breakeven quarter. Despite the unfavorable comparisons, we view the quarter as not out of line with expectations for the company, which is still in a transitional period as it seeks to redeploy the $28 million net after-tax cash position on its balance sheet in the aftermath of the transfer of interests in its Delhi Holt Bryant Unit in Louisiana to Denbury Resources (NYSE: DNR) during the fourth quarter of the prior fiscal year.
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Forgent Networks, Inc. Nasdaq: FORG $1.05
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.40
By: Richard W. West, CFA
Forgent Networks Reports Second-Quarter and Six-Month Results for FY2007; Reiterate Strong Speculative Buy Rating and Price Target of $2.40
March 1, 2007. Forgent Networks, Inc. (NasdaqGM:FORG) reported its second quarter ended January 31, 2007, as profitable for the second quarter in a row, resulting in profitability for the first half of FY2007. We recognize the uncertainty surrounding the '746 patent litigation and look forward to the scheduled mediation on April 15, 2007, with positive anticipation. We reiterate our rating of Strong Speculative Buy and reaffirm our price target of $2.40 per share.
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Green Plains Renewable Energy NasdaqNM: GPRE $21.67
Research Report
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $58.00
By: Paul J. Resnik, CFA
Green Plains Renewable Energy Rated Strong Speculative Buy In Update Coverage; Turn Profitable In The Fourth Quarter of 2007
March 14, 2007. Green Plains Renewable Energy (Nasdaq: GPRE; AMEX: GPRE) is currently building two 50-million-gallon dry mill ethanol plants; one in Shenandoah, Iowa and another in Superior, Iowa. The projected annual production capacity of each of the plants under construction is approximately 55 million gallons of ethanol and 176,000 tons of animal feed (we assume the plant will run at about 10% above the nameplate level). The Shenandoah plant is scheduled to be completed by mid-2007 and the Superior plant should be in operation by the beginning of 2008. Despite rapid growth in demand for ethanol, the shares of ethanol producers have been weak based on concerns that the rapid build-up of ethanol production capacity will depress the price of ethanol and create tight supply conditions, and therefore higher prices, for corn. However, ethanol prices have firmed recently, mirroring an uptick in gasoline prices, and the current April Chicago Board of Trade (CBOT) contract price of $2.32/gallon is well above the $2.00 level upon which we have based our earnings projections. Corn on the other hand, now trades at about $4.00/bushel versus levels well below $2.50 a year ago. We believe a sharp increase in acreage devoted to corn will bring prices down to the $3.00 - $3.50 area later this year. We believe Green Plains will turn profitable in the fourth quarter of 2007 and our $58.00 target represents a better than doubling in the stock price.
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Green Plains Renewable Energy NasdaqNM: GPRE $21.67
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $58.00
By: Paul J. Resnik, CFA
Green Plains Announces New CEO; Reiterate Strong Speculative Buy Rating
March 2, 2007. Green Plains Renewable Energy, Inc. (Nasdaq:GPRE) late yesterday announced that Barry A. Ellsworth has resigned his positions as President and Chief Executive Officer of the Company, and Mr. Wayne Hoovestol has been appointed as the Company's new CEO. Mr. Hoovestol will continue to act as a director of the Company and as the Company's Chief Operating Officer. Mr. Ellsworth will continue with the Company as a director and as Executive Vice President of Compliance and Development. As Green Plains moves closer to commencing operations, the shift to an individual with greater experience managing an operating company (despite Mr. Ellsworth's demonstrated broad knowledge of the ethanol business) appears to be a reasonable move for the Company. We reiterate our Strong Speculative Buy rating on Green Plains' shares.
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Harbin Electric, Inc. Nasdaq: HRBN $11.62
Research Note
Industry: Industrial & Manufacturing
Rating: Strong Speculative Buy (Reiterated)
Price Target: $12.30
By: Stanley Ng
Harbin Electric's Robust Fourth Quarter and Non-cash Items Lifts Fiscal 2006 Financial Results; Earnings Forecasts for 2007 and 2008 and Price Target Under Review
March 13, 2007. Harbin Electric, Inc. Recently Announced Strong 4Q06 and Fiscal 2006 Financial Results
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HydroGen Corporation NasdaqCM: HYDG $4.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
HydroGen Corporation Reports 2006 Results; Makes Progress On Business Plan; Speculative Buy Reiterated
March 15, 2007. HydroGen Corp. (NasdaqCM: HYDG) reported fourth quarter 2006 revenue of $610,721 and an operating loss of $7.4 million or $0.67 per share. Since HydroGen is in the early stages of commercializing its fuel cell products, we do not believe that the year's results reflect the Company's long-term potential. During 2006 and thus far in 2007, we believe that the Company made significant progress on its business plan. Most recently, in February, HydroGen announced the mechanical completion of its 400 kilowatt phosphoric acid fuel cell module demonstration and acceptance test facility and initiation of pre-commissioning activities. The test facility will be used for demonstration and acceptance testing of 400 kilowatt fuel cell modules manufactured in HydroGen's Versailles, Pennsylvania plant. We rate HydroGen's shares Speculative Buy. We consider the shares appropriate for aggressive investors willing to accept the above-average risk inherent in an early-stage company that is not yet profitable.
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HydroGen Corporation NasdaqCM: HYDG $4.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
HydroGen Corp. Makes Progress On Growth Strategies; Fourth Quarter Preview
March 14, 2007. HydroGen Corp. (NasdaqCM: HYDG): We expect HydroGen to report fourth quarter results by the end of March. Since HydroGen is in the early stages of commercializing its fuel cell products, we do not believe that the results will be indicative of its long-term potential. More important, in our opinion, is evidence that the Company is achieving the goals set out in its business plan. During 2006 and thus far in 2007, we believe that the Company made significant progress on this plan. Most recently, in February, HydroGen announced the mechanical completion of its 400 kilowatt phosphoric acid fuel cell module demonstration and acceptance test facility and initiation of pre-commissioning activities. The test facility will be used for demonstration and acceptance testing of 400 kilowatt fuel cell modules manufactured in HydroGen's Versailles, Pennsylvania plant. We rate the Company's shares Speculative Buy. We consider the shares appropriate for aggressive investors willing to accept the above-average risk inherent in an early-stage company that is not yet profitable.
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HydroGen Corporation NasdaqCM: HYDG $4.65
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
Hydrogen Corp. Begins Trading On Nasdaq
March 6, 2007. Hydrogen Corp. (NASDAQ: HYDG): The shares of HydroGen Corp. will begin trading on the Nasdaq Capital Market March 6. Previously, the shares traded on the Over the Counter Bulletin Board. We consider this shift an important milestone for HydroGen as a public company. In our view, advantages of trading on Nasdaq include greater visibility and credibility with the investment community and more liquidity. We continue to rate the shares Speculative Buy.
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Logility Inc. Nasdaq: LGTY $7.58
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Speculative Buy (Reiterated)
Price Target: $12.50
By: David P. Soetebier, CFA
Logility, Inc. Reports Operating Earnings Up 22% on Record Revenues
March 8, 2007. Logility Inc. (NasdaqGM: LGTY), a leading supplier of collaborative solutions to optimize the supply chain, beat our earnings per share estimate by $0.05 per share. The positive variable was primarily gross profit margins. Revenues at $11.3 million were $300,000 above our estimate. Gross profits came in at $7.9 million versus our estimate of $7.2 million reflecting a gross profit margin of 69.7% versus our estimate of 66% and gross margins last quarter of 64.5%. Gross profit margins improved in all three-business areas versus three months ago, benefiting from the strong software sales and the higher revenue base in the Services and Maintenance businesses. Because of the stronger quarter versus our estimate we have raised our fiscal 2007 (April) earnings per share estimate to $0.40 (fully diluted). Our Rating remains Strong Speculative Buy with a 12-month target of $12.50
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Lime Energy Co. OTCBB: LMEC $0.97
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Lime Energy Co. Reports Preliminary Results of Q4/2006 and FY2006: Restructuring and Full Company Integration Completed in FY2006;Strong Speculative Buy Reiterated
March 13, 2007. On March 12, 2007, Lime Energy Co. (OTCBB:LMEC) announced its fourth-quarter 2006 and full-year 2006, results with numbers showing improvement in revenue and with gross profits in both periods. The stock market has yet to recognize the massive changes Lime Energy has achieved. We believe that as the coming quarters are reported, the stock market will recognize the "new" Lime Energy Co. We reiterate our Strong Speculative Buy and $2.00 price target.
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Lime Energy Co. OTCBB: LMEC $0.97
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Lime Energy to Conduct Conference Call to Discuss 4Q/2006 and Full-Year 2006;Rights Offering Instructions Clarified;Strong Speculative Buy Reiterated
March 13, 2007. Lime Energy Co. (OTCBB:LMEC) has scheduled a conference call for this Wednesday, March 14th, at 11 a.m. ET to discuss the results from its fourth-quarter 2006 and full-year 2006, and to provide a general company update.
Lime Energy today released information for clarification regarding its current rights offering, which has been distributed to stockholders of record as of February 23, 2006. We reiterate our Strong Speculative Buy and $2.00 per share price target.
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Lantronix, Inc. Nasdaq: LTRX $1.61
Research Report
Industry: Electronics & Engineering
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.50
By: David P. Soetebier, CFA
Lantronix Rating of Strong Speculative Buy Maintained; Expect Lantronix's Growth To Accelerate Over The Intermediate Term From The Introduction Of Multiple Products In The Past Two Years
March 16, 2007. Lantronix (Nasdaq: LTRX) offers investors the most leveraged way to participate in the developing machine-to-machine (M2M) connectivity industry with 73% of its revenues from M2M sales. Computers generally have networking ability but machines do not. However, by 2010, an estimated 95% of all devices connected will not be computers, but rather machines or devices representing a $10 billion market opportunity (Source: Forrester). We expect Lantronix's growth to accelerate over the intermediate term from the introduction of multiple products in the past two years, (13 in the past 12-months) including an important wired networking component (XPort Direct) priced under $20 that should broadly expand the market for networking devices. Although the industry is still in the development stage, Lantronix already offers a broad product line and has a highly experienced management team that we believe can capitalize on this market potential. We believe investors have failed to value the company relative to this growth potential. Consequently, we consider the shares undervalued at the recent price of $1.61. Our rating is Strong Speculative Buy with a 12-month target of $2.50.
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Maine & Maritimes Corporation AMEX: MAM $18.29
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $20.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation: Feasibility of New Transmission Line Studied; 10-K Could Provide Color On Future Direction.
March 10, 2007. Maine & Maritimes Corporation (AMEX: MAM) is taking part in a study of the feasibility of a new power transmission line that would directly connect the Aroostook County power grid and the rest of the state of Maine. We believe that direct connection to the rest of Maine could be very beneficial to Maine Public Service (MPS), Maine & Maritimes' regulated electric transmission and distribution utility, because of the potential for greater utilization of its existing infrastructure (and, therefore, greater revenue potential). Also, this year, Maine is expected to consider whether to allow electricity transmission and distribution companies such as MPS to own power generating assets as well, which we believe could open additional growth and value enhancement opportunities to MPS. We expect Maine & Maritimes to file its 2006 10-K around March 15. Following the resignation of Maine & Maritimes' Chief Executive Officer in August 2006, the Board put the Company's aggressive growth strategy of recent years on hold, while it reviewed strategic options and evaluated the Company's product and service mix, corporate structure, diversification strategy and operational objectives. We believe that the 10-K may provide some information on the results of the Board's review and the future direction of the Company and, therefore, could be an important document for investors evaluating its strategies and prospects. We reiterate our Speculative Buy rating on Maine & Maritimes common stock.
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Medivation, Inc. AMEX: MDV $18.41
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $27.00
By: Wayne M. Lottinville, CFA
Medivation Strong Speculative Buy Rating In Update Coverage;Three Promising Therapies With Potential To Advance Treatment Results In The Fights Against Alzheimer's disease, Huntington's disease and Prostate Cancer
March 15, 2007. Medivation (AMEX: MDV) recently said that preclinical data suggest that the Company's lead development candidate for hormone-refractory prostate cancer treatment is effective in a mouse model of the disease. Results of the research showed treatment was associated with a significant dose-dependent reduction in tumor volume in human hormone-refractory prostate tumors grown in mice. In October, Medivation announced compelling Phase 2 clinical results for the treatment of Alzheimer's disease. Not only did treated patients show an improvement over placebo, but also they demonstrated a significant improvement over baseline for all five endpoints of the study. In Huntington's disease, the Company initiated a two-part Phase 1-2a clinical trial in October 2006. The second phase of the study is expected to begin in the first half of 2007 with efficacy data reported in the second half of this year. Based on the dramatic and promising results from Medivation's Phase 2 Alzheimer's study, on the recently announced preclinical results in the Company's prostate cancer investigation, and on our perceptions of management's capabilities, we believe that the Company has a better than average opportunity to clear regulatory hurdles and ultimately win FDA approval for one or more of its development programs. We assume that Medivation wins approval of its drug candidate for treatment of Alzheimer's by 2011 and that by 2013 sales reach $1.3 billion. Discounting a price-to-sales multiple of 5x, we calculate a 2008 price target of nearly $27.00 per share. Based on this price target and timeline, we rate Medivation's shares a Strong Speculative Buy.
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Medivation, Inc. AMEX: MDV $18.41
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $27.00
By: Wayne M. Lottinville, CFA
Medivation To Jump From The Amex To The Nasdaq; Reiterate Strong Speculative Buy
March 9, 2007. Medivation, Inc. (Amex: MDV), will move from the American Stock Exchange, or Amex, where it currently trades under the symbol MDV, to the Nasdaq Global Market on March 20, where its stock will bear the ticker symbol MDVN.
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Medivation, Inc. AMEX: MDV $18.41
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $27.00
By: Wayne M. Lottinville, CFA
Medivation to Present Clinical Progress at Healthcare Conference; Reiterate Strong Speculative Buy
March 5, 2007. Medivation, Inc. (Amex: MDV), will provide another overview of the Company and its clinical development programs in Alzheimer's and Huntington's diseases, and prostate cancer at an upcoming healthcare conference in Boston. Medivation has reported compelling Phase 2 clinical results for the treatment of Alzheimer's disease, which met all five efficacy endpoints and showed strong statistical significance compared with placebo.
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MediciNova, Inc. NasdaqGM: MNOV $11.50
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $20.00
By: Wayne M. Lottinville, CFA
MediciNova To Present At Healthcare Conference; Reiterate Strong Speculative Buy
March 15, 2007. MediciNova, Inc. (NasdaqGM: MNOV; Osaka: 4875), will offer investors an overview of the Company and its clinical progress at a healthcare conference in Miami Beach on March 19. MediciNova is developing eight unique, differentiated small molecules for 10 different therapeutic indications. The Company's development programs include therapeutic drug candidates for treatment of asthma, multiple sclerosis, cancer, and urinary incontinence. Most of these programs are in advanced clinical testing.
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MediciNova, Inc. NasdaqGM: MNOV $11.50
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $20.00
By: Wayne M. Lottinville, CFA
MediciNova Strong Speculative Buy Rating In Update; Significant Potential Improvements Over Current Standards Of Care For A Variety Of Diseases And Conditions
March 7, 2007. MediciNova (Nasdaq: MNOV) is developing eight unique, differentiated small molecules for 10 different therapeutic indications. These therapeutics offer significant potential improvements over current standards of care for a variety of diseases and conditions. MediciNova's development programs include therapeutic drug candidates for treatment of asthma, multiple sclerosis, cancer, and urinary incontinence. Most of these programs are in advanced clinical testing. With the failure of MN-001 to meet its main endpoint target in its Phase 2/3 trial for interstitial cystitis, we temporarily removed it from the tally. The new total fifth-year sales potential is $5.8 billion. This does not include the sales potential of the Company's recent preclinical acquisitions. We project the Company's estimated market potential for each of the remaining seven programs, then discount these projections by a statistical likelihood of clinical and marketing success or failure (from Phase I, for example, we estimate that a drug candidate has, on average, only a 21% chance of achieving FDA approval and subsequent success in the marketplace). We then reduce that by an additional 35% discount rate to account for the general inherent risk of biotechnology development programs. MediciNova's recent market capitalization of $140 million was well below our calculated present value.
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Neurobiological Technologies, Inc. NASDAQ: NTII $2.63
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $8.00
By: Denise T. Resnik, M.S.
Neurobiological Technologies Reports Second Quarter Results: Reiterate Strong Speculative Buy
March 2, 2007. Neurobiological Technologies (Nasdaq:NTII) announced on February 8, 2007 financial results for the quarter ended December 31, 2006 in line with their forecasts. The Company continues to invest strongly in its Viprinex(TM) clinical program for acute ischemic stroke which is currently in two Phase III trials. In addition, the Company is involved with ongoing Phase III trials of XERECEPT® for the treatment of swelling associated with brain tumors in collaboration with Celtic Pharma.
We reiterate our Strong Speculative Buy rating.
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O2Diesel Corp AMEX: OTD $0.73
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $2.25
By: Sally H. Wallick, CFA
O2Diesel Corporation Quarter Previewed; Company Enters Into Supply Agreement With Fair Energy.
March 16, 2007. O2Diesel Corporation (AMEX: OTD): We expect O2Diesel to file its 2006 10-K by late March. We anticipate fourth quarter results similar to those reported in recent periods, with modest revenue and a small loss per share. During the fourth quarter and thus far in 2007, O2Diesel has made significant progress on its business plan of commercializing its ethanol-diesel fuel blend including supply agreements with Singapore-based Energenics Pte Ltd. for Asia Pacific and South Africa and Geneva-based Fair Energy S.A for certain South American countries and Switzerland and the signing of a definitive agreement to acquire 80% of ProEco Energy Company, Inc., which is developing a 100-million-gallon ethanol plant. We reiterate our Speculative Buy rating on the Company's common stock.
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O2Diesel Corp AMEX: OTD $0.73
Research Report
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $2.25
By: Sally H. Wallick, CFA
O2Diesel Speculative Buy Rating Reiterated In Update Coverage; Announces Acquisition of ProEcho Energy Who Is Building 100 mm Gallon Ethanol Plant
March 14, 2007. O2Diesel (AMEX: OTD) has developed a proprietary additive technology, O2D05, which facilitates the blending of ethanol, an oxygenate, in diesel fuel, resulting in a proprietary, clean-burning fuel called O2Diesel™. Extensive testing has shown that the use of O2Diesel alone or with other emission-control devices can produce significant and verifiable reductions in diesel engine emissions. Management's business strategy is aimed at commercializing the Company's products in the U.S. and internationally. Its initial target market is centralized fleets of diesel-powered vehicles. During 2006 and thus far in 2007, O2Diesel achieved important milestones toward commercializing its products in the U.S. and internationally. Notable achievements include a partnership agreement with Energenics to market O2Diesel (using the name EnerDiesel) in Asia; the planned acquisition of ProEco Energy Company, Inc., which is developing a 100-million-gallon ethanol plant in South Dakota; and contracts with municipal and corporate customers and the Department of Defense (DoD) in the U.S. We view the proposed ProEco acquisition as a bold move with the potential to provide a number of significant benefits to O2Diesel. Most importantly, it should give O2Diesel access to a reliable supply of ethanol at very competitive costs, enabling it to market O2Diesel to large national customers in the U.S. at a price below that of regular diesel, and, therefore, strengthening its competitive position. In 2005, the Company reported total revenue of $195,607 and an operating loss of $7.5 million, and its revenue and operating loss for the nine months ended September 30, 2006 were $141,201 and $6.4 million, respectively.
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On Track Innovations Ltd. Nasdaq: OTIV $7.21
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Buy (Reiterated)
Price Target: $12.00
By: Rafael K. Kapelinski
On-Track Innovations: Publishes 4Q 2006 Results, First Reaction and Reiterate Strong Buy and USD$12 Price Target
March 5, 2007. We reiterate our Strong Buy rating on On-Track Innovations (Nasdaq; OTIV) following today's publication of 4Q 2006 results. Given the strong set of numbers, we expect to see some strength in the share price in the coming days. Our price target remains USD 12.
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Pacific Asia China Energy Inc. CDNX: PCE $0.49
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard R. Wolfe, CFA
PACE in C$9 Million Turnkey Degasification Contract
March 10, 2007. Pacific Asia China Energy (TSX: PCE), through its joint venture with Mitchell Drilling Corp. of Australia, has signed a multi-company degasification contract with the Shenhua Ningxia Coal Group, a unit of Shenhua Group Corp, China's largest coal producer. Our estimates for the Company's performance during fiscal 2008 (ending Feb. 28, 2008) are provisionally reaffirmed.
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PacificHealth Laboratories Inc. OTCBB: PHLI $1.95
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $2.00
By: Jonathan H. Ziegler, CFA
PacificHealth Labs Announced Its Fourth Quarer And Year-end Results; Total Quarter Revenues Up 51.2% to $1.11 Million EPS Were ($0.03) Compared To Our $0.00 Estimate
March 13, 2007. PacificHealth Laboratories, Inc. (OTCBB: PHLI) reported fourth quarter and year-end results. While reported revenues for the quarter of $1.1 million exceeded our estimate by 16.5%, and were up 51.2% from the year-ago quarter, expenses were somewhat higher than we had estimated and, consequently, reported EPS of ($0.03) missed our estimate of break-even.
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Pointer Telocation Nasdaq: PNTR $10.70
Research Note
Industry: Business & Support Services
Rating: Strong Buy (Reiterated)
Price Target: $18.00
By: Rafael K. Kapelinski
Pointer Telocation (PNTR): Signs Two MOUs in Argentina, Reiterate Strong Buy
March 12, 2007. Pointer's announcements about the signing of binding MOUs with SVR and RSA companies in Argentina is a positive, in our view. We continue to believe that Pointer is a bet on the managements ability to achieve increasing economies of scale by winning market share in the domestic market and growing the top-line through international expansion, particularly in Latin America. However, while growing market share in the saturated Israeli market will require significant resources, consolidating the highly fragmented Latin market is a low hanging fruit. In fact, we would like to argue that the Companys share price performance should be a direct function of the Companys perceived success on the M&A front in Latin America. Given the managements strong track record in consolidating Shagrir, we believe that the prospects are strong.
Given the indicated purchase price of USD 9 million for one of the target companies, it is clear that the Company will have to raise additional cash before the end of 2007E. We reiterate our Strong Buy rating and price target of USD 18.
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Pointer Telocation Nasdaq: PNTR $10.70
Research Note
Industry: Business & Support Services
Rating: Strong Buy (Reiterated)
Price Target: $18.00
By: Rafael K. Kapelinski
Pointer Telocation: 4Q 2006 Results Preview
March 5, 2007. Pointer Telocation Ltd. (NasdaqCM: PNTR) will report 4Q 2006 results tomorrow. We expect revenues of USD $11.0 million and fully-diluted EPS of USD $0.38. We view the current valuation as attractive and reiterate our Strong Buy rating.
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Petro Resources Corporation AMEX: PRC $2.99
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Initial)
Price Target: $5.75
By: Richard R. Wolfe, CFA
Petro Resources: Successfully Closes Williston Basin Acquisition; Should Increase Proved Reserves More than 100%
March 11, 2007. Petro Resources Corp. (AMEX: PRC) Management's recent announcement of the closing of its approximate $65 million acquisition of 50% of the interest (approximate 43% working interest, net to Petro Resources) of a private North Dakota operator in 15 fields located in the Williston Basin is an undoubted milestone for the Company. By our estimate, the transaction should increase the Company's production by 70% and proved reserves by 170%.
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Patriot Scientific Corp. OTCBB: PTSC $0.63
Research Note
Industry: Electronics & Engineering
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $1.50
By: Richard W. West, CFA
Patriot Scientific Announces License for Leading Worldwide Flash Storage Card Company;Strong Speculative Buy Rating Reiterated
March 10, 2007. Patriot Scientific Corporation (OTCBB:PTSC) announced that SanDisk (NasdaqGM:SNDK) purchased a license that gives it the right to use technologies protected by the Moore Microprocessor Patent Portfolio (MMP Portfolio). SanDisk is a world leader in flash data storage card products, using its patented, high- density flash memory and controller technology. We cannot stress enough, with the continued announcements of additional licensees, that we strongly believe that investors should seriously review Patriot Scientifics fundamental revenue and earnings potential. We reiterate our Strong Speculative Buy rating and maintain our 12-month price target of $1.50.
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Pro Travel Network, Inc. OTCBB: PTVL $1.60
Research Report
Industry: Leisure & Entertainment
Rating: Speculative Buy (Initial)
Price Target: $2.00
By: Richard W. West, CFA
Pro Travel Network Speculative Buy Rating In Initiating Coverage; Direct-To-Consumer Service Business That Leverages The Home-Based Business Concepts With The Travel Industry
March 12, 2007. Pro Travel (OTCBB: PTVL) is conducting a relatively young direct-to-consumer service business that leverages the home-based business concepts with the travel industry. Pro Travel believes they offer one of the most unique and comprehensive independent travel agent training packages in the travel industry. As of February 8, 2007, Pro Travel has approximately 8,000 independent travel agents. Pro Travel's core business consists of leveraging its technology and services to provide travel stores on the Internet to the home based independent travel agents. Pro Travel currently receives revenue from four sources discussed in the report. The travel industry continues to grow. In 2004 in the United States, approximately $1.3 trillion was spent on travel and tourism. Worldwide, the figure was approximately $7.0 trillion. In recent years the scene has changed with the advent of individuals utilizing the Internet to book travel. Direct travel bookings on the Internet saw approximately 79 million travel bookings made in 2005, up from 64 million in 2004. Company revenues are projected to reach $3.3 million for FY 07 ended June 30th, and increase to $4.1 million in FY 08. EPS are projected to reach $.02 in the current fiscal year, increasing to $,03 in FY08. At our price target of $2.00, Pro Travel would be selling at a $48.0 million market capitalization.
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Provectus Pharmaceuticals Inc OTCBB: PVCT $1.17
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.90
By: Wayne M. Lottinville, CFA
Provectus To Boost Investor Relations Capabilities, Increase Awareness; Reiterate Strong Speculative Buy
March 13, 2007. Provectus Pharmaceuticals, Inc., will ramp up its investor relations and corporate communications capabilities with the hiring of The Investor Relations Group. The IR firm plans to introduce Provectus to prequalified fund managers and industry analysts with the goal of increasing investor and industry awareness of the Company. The Investor Relations Group also intends to shape Provectus' message to the public and the media.
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Raser Technologies Inc. NYSE: RZ $5.08
Research Note
Industry: Industrial & Manufacturing
Rating: Not Rated (Reiterated)
Price Target: N/A
By: Gerald A. Rothstein, CFA
Raser Technologies Makes Two Announcements
March 8, 2007. Raser Technologies Inc. (NYSE: RZ) recently announced that two manufacturers had agreed to test and "mass production qualify" its Symetron technology. It also announced that AMP Resources had notified Raser of its intent to pay its $6 million note to Raser and that Raser had agreed to a 21 day interest bearing extension of the note.
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Shumate Industries, Inc. OTCBB: SHMT $1.55
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.00
By: Richard R. Wolfe, CFA
Shumate Industries: Preliminary Results In-Line after Deferred Revenue Adjustment
March 6, 2007. Shumate Industries, Inc. (OTCBB: SHMT) released preliminary fourth quarter and full-year 2006 results in summary form, indicating 4th-quarter revenues of $2.1 million, in line with our estimates when adjusted for management's decision to defer $400,000 of progress payments related to its prototype downhole isolation valve. The Company expects to release its annual report on Form 10-K on or about March 15, at which time an earnings conference call has been slated by management.
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Apex Silver Mines Ltd AMEX: SIL $13.20
Research Note
Industry: Metals & Mining
Rating: Neutral (Reiterated)
By: Mike Niehuser
Apex Silver Derivatives Trigger Restatement
March 3, 2007. Apex Silver Mines Limited (AMEX: SIL) has requested a 15 day extension to file its 2006 year-end results. The company has recalculated derivatives resulting in restating income statements as far back as September 30, 2005. The company's primary asset, the San Cristobal mine, is 90% complete and on schedule for the first sale of concentrates in the third quarter of 2007.
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Touchstone Applied Science Associates, Inc. OTCBB: TASA $5.70
Research Report
Industry: Publishing & Media
Rating: Buy (Reiterated)
Price Target: $8.00
By: Sally H. Wallick, CFA
Touchstone Applied Sciences Rating Maintained At Buy; The Questar Acquisition Was The Defining Event of Fiscal 2006; Trading At Only 5.4x Projected Fiscal 2007 EBITDA Vs 15.5 Industry Average
March 16, 2007. Touchstone (OTCBB: TASA) reported a more than doubling of fiscal 2006 revenue year over year to $23.7 million, as a result of a $9.9 million revenue contribution from Questar Educational Systems, which the Company acquired in May 2006, and 18% revenue growth at its pre-Questar businesses. In fiscal 2006, Touchstone booked a number of charges and other items that reduced operating income $1.78 million. The Company reported a fiscal 2006 operating loss of $888,000, versus an operating profit of $627,000 in fiscal 2005, and a net loss of $1.125 million, or $0.23 EPS, diluted, versus a net profit of $433,000, or $0.14 EPS in fiscal 2005. EBITDA totaled $1.3 million or $0.27 per share, flat with EBITDA of approximately $1.3 million in fiscal 2005. On a pro forma basis, the Company's fiscal 2006 revenue would have been $45.1 million, up 20% year over year, and EBITDA would have been $6.5 million versus $6.3 million. Two recent accounting changes will affect Touchstone's fiscal 2007 results and are discussed in the report. Taking into account these changes, we reduced our fiscal 2007 estimate for Touchstone from a $0.43 per share profit to a $0.06 per share loss. Our EBITDA estimate for fiscal 2007 is $5.2 million or $1.05 per share. TASA shares are trading at only 5.4x projected fiscal 2007 EBITDA, well below the average of 15.6x trailing 12-month EBITDA for 19 other publicly traded companies in the education industry.
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Touchstone Applied Science Associates, Inc. OTCBB: TASA $5.70
Research Note
Industry: Publishing & Media
Rating: Buy (Reiterated)
Price Target: $8.00
By: Sally H. Wallick, CFA
Touchstone Applied Science Associates: One-time items contribute to FY06 loss; FY07 estimate lowered; shares trade at only 5.7x FY07 projected EBITDA; Buy rating maintained.
March 12, 2007. Touchstone Applied Science Associates, Inc.s (OTCBB: TASA) fiscal 2006 revenue more than doubled year over year to $23.7 million, as a result of a $9.9 million revenue contribution from Questar Educational Systems, which it acquired in May 2006, and 18% revenue growth at its pre-Questar businesses. Touchstone booked charges and other items in fiscal 2006 that reduced operating income $1.78 million. As a result, the Company reported a fiscal 2006 operating loss of $888,000, compared with an operating profit of $627,000 in fiscal 2005, and a net loss of $1.125 million, or $0.23 per share, diluted, versus a net profit of $433,000, or $0.14 per share in fiscal 2005. Earnings before interest, taxes, depreciation and amortization, or EBITDA, totaled $1.3 million ($0.27 per share), flat with EBITDA of $1.3 million in fiscal 2005. On a pro forma basis, the Companys fiscal 2006 revenue would have been $45.1 million, up 20% year over year, and EBITDA would have been $6.5 million ($1.29 per share) versus $6.3 million ($1.26 per share). We are lowering our fiscal 2007 estimate to a loss of $0.06 per share from a profit of $0.43 per share, mainly to reflect the effect of accounting changes and a lower gross margin on projected results. Our EBITDA estimate for the year is $1.05 per share. We consider the Questar acquisition (the largest acquisition in Touchstones history) the defining event of fiscal 2006. We believe that Questars operational strengths complement Touchstones development capabilities, allowing the combined Company to provide the entire spectrum of assessment services for large state level contracts for the first time. It appears that the integration of Questar has gone smoothly, and the combined Company is pursuing new revenue opportunities by bidding on larger numbers of contracts than previously and on contracts with larger dollar values. This strategy already appears to be paying off, as indicated by recently announced contract wins totaling up to $9.5 million. We reiterate our Buy rating on the Companys shares, which are trading at only 5.7 times projected fiscal 2007 EBITDA.
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Touchstone Applied Science Associates, Inc. OTCBB: TASA $5.70
Research Note
Industry: Publishing & Media
Rating: Buy (Reiterated)
Price Target: $8.00
By: Sally H. Wallick, CFA
Touchstone Applied Science Associates, Inc.: Fiscal Fourth Quarter Earnings Preview.
March 7, 2007. Touchstone Applied Science Associates, Inc. (OTCBB: TASA) plans to report fiscal 2006 fourth quarter and full year earnings on March 12. The fourth quarter will include results for Questar Educational Systems, Inc. (which Touchstone acquired May 31, 2006) for the entire period. Questar provides test delivery, scoring and score analysis capabilities to state testing programs and develops test materials. In our opinion, this acquisition was by far the most important event of 2006. We believe that the combination of the two companies is mutually beneficial since Questar's operational strengths complement Touchstone's development capabilities. Another noteworthy event during 2006 was the appointment of a Chief Financial Officer (CFO), which has freed Andy Simon, the Company's President and Chief Executive Officer (and previously CFO), to devote more of his time to strategic issues. In light of the major acquisition completed in fiscal 2006, which has had a significant effect on the Company's operations and structure, we expect Touchstone to book nonoperating items in the fourth quarter as a result of a year-end asset review and a desire to position operations conservatively going forward. Since we have no way of estimating these items at present, we have maintained our estimates. However, we expect them to reduce the net income and, therefore, caution that we expect actual bottom-line results to vary significantly from our numbers. We reiterate our Buy rating on Touchstone's shares.
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21st Century Holding Co Nasdaq: TCHC $18.48
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
21st Century Reports Fourth Quarter and FY2006 Results; Our Comment - Negative Numbers Belie Positive Results; Strong Buy Rating Reiterated
March 10, 2007. 21st Century Holding Co. (NasdaqGM:TCHC) reported its fourth quarter ended 12/31/06; total revenue decreased 9.5% to $22.5 million from $24.5 million for the fourth quarter ended 12/31/05. Those are the raw numbers, however, management clarified the reasons behind the loss for the FY2006 fourth quarter in a detailed conference call on March 8, 2008. While it is never positive to see such losses as reported in 21st Century's fourth quarter, we believe that investors should understand the reasons why and focus on the positive factors for 21st Century. We reiterate our Strong Buy recommendation and our 12-month price target of $35.00 per share.
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21st Century Holding Co Nasdaq: TCHC $18.48
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
21st Century Holding Company Announces Dividend;Maintaining $0.18 Quarterly Rate:Reiterate Strong Buy Rating
March 6, 2007. 21st Century's Holding Co. (NasdaqGm:TCHC) board of directors declared a regular quarterly dividend of $0.18 per common share for the second quarter of 2007. The dividend was increased 50% in December 2006, from $0.12 per share to $0.18 per share for the first quarter of FY2007. We reiterate our Strong Buy Rating and $35.00 price target.
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Top Image Systems Ltd Nasdaq: TISA $3.67
Research Note
Industry: Software
Rating: Buy (Reiterated)
Price Target: $5.00
By: Rafael K. Kapelinski
Top Image Systems: Tracking Our Estimates, Reiterate Buy
March 8, 2007. We believe that the Top Image Systems (Nasdaq: TISA) is tracking our 1Q 2007E revenue and EPS estimates of USD 5.6 million (+2% sequentially and +24% year-on-year). Europe remains incrementally slower than at the same time last year, which has been reflected in the quarterly comments by the Company's competitors such as Dicom, OpenText and ReadSoft. At the same time, the Japanese business is doing well, as well as Latin America. We believe that an imminent acquisition should emerge as an important share price driver in the near term
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Telanetix, Inc. OTCBB: TNXI $3.80
Research Note
Industry: Electronics & Engineering
Rating: Strong Speculative Buy (Reiterated)
Price Target: $5.00
By: Joe Noel
Telenetix Announces High-end Videoconferencing Products Interoperable With Most Desktop Videoconferencing Systems; Reiterate Strong Speculative Buy
March 6, 2007. Telenetix, Inc. (OTCBB: TNXI), on March 6th, announced its high-end videoconferencing products will support interoperability with most desktop videoconferencing systems. We believe this is an important announcement that should help the company drive its revenues. We reiterate our Strong Speculative Buy rating.
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Wave Systems Corp. Nasdaq: WAVX $2.63
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Speculative Buy (Reiterated)
Price Target: $4.50
By: Robert Goldman
WAVE TDM Shipping With Seagate Notebook PC Hard Drive
March 13, 2007. Wave Systems Corp. (NASDAQGM: WAVX) announced today that its Embassy Security Center's Trusted Drive Manager (TDM) is featured in Seagate's (NYSE: STX) Momentus 5400 FDE.2 notebook PC hard drive that is shipping to ASI Computer Technologies. This represents the first meaningful shipment of Seagate's Momentus 5400 FDE drives incorporating Wave's Embassy Trust Drive Manager and may be the first step toward broader Seagate/Wave notebook PC hard drive and TDM deployment.
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XAAR Plc LSE: XAR $4.40
Research Note
Industry: Computers, Technology & Internet
Rating: Buy (Reiterated)
Price Target: $6.15
By: Rafael K. Kapelinski
Xaar: To Report 2H 2006 on March 15. Results Preview
March 13, 2007. Xaar (LSE: XAR) will report a full set of 2H 2006 results on March 15. We forecast 2H 2006 revenues of £22.8 million (+2.2% over 1H 2006) and EPS of £0.053. All in all, we anticipate the tone of the call to be positive as the Company has gotten the Chinese situation under control.
Most recently, Kodak's unveiling of its digital inkjet strategy only demonstrated the impetus of the ongoing digital inkjet paradigm shift. We maintain our stance that the Company represents a very attractive takeover target: it holds an impressive patent portfolio and industry recognition. In our recent update, we have looked at some of the more recent OEM developments and analyze their potential implications for Xaar. Since then our stance has not changed: we reiterate our Buy rating.
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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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