Amarillo Biosciences Inc. OTCBB: AMAR $0.77
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $1.90
By: Wayne M. Lottinville, CFA
Amarillo Biosciences Reports First Quarter Results; Reiterate Speculative Buy
May 12, 2007. Amarillo Biosciences (OTCBB: AMAR) reported a loss of $745,000, or $0.03 per share, in the first quarter of 2007 on operating expenses of $765,000. This compares with a loss of $771,000, or $0.04 per share, in the same quarter a year earlier on operating expenses of $778,000. We had projected a loss of $975,000, or $0.04 per share in 1Q07 on operating expenses of $983,000.
Download Research Note
Amarillo Biosciences Inc. OTCBB: AMAR $0.77
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $1.90
By: Wayne M. Lottinville, CFA
Amarillo Biosciences Makes Clinical Progress With New Sites; Reiterate Speculative Buy
May 2, 2007. Amarillo Biosciences, Inc. (OTCBB: AMAR), says in a recent progress report to shareholders that it will continue development of low-dose oral interferon for treatment of influenza, and has recently added sites in its Behcet's disease and oral warts in HIV-positive patients clinical trials. In addition, a Taiwan biopharmaceutical company intends to conduct a human clinical study using Amarillo Biosciences' low-dose oral interferon to treat hepatitis C in 150 patients.
Download Research Note
Ampex Corporation Nasdaq: AMPX $16.20
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
Ampex Announces Agreement with M-CAM, Inc. To Develop Strategy to Commercialize Ampex Patents;
Strong Buy Rating Reiterated
May 15, 2007. Ampex Corporation (NasdaqGM:AMPX) announced on May 14, 2007, it had signed an agreement with M-CAM, Inc. wherein M-CAM will develop a strategic plan intended to accelerate and broaden Ampex's licensing program and to commercialize and monetize Ampex's intellectual property. We reiterate our Strong Buy Rating and $35.00 price target.
Download Research Note
Ampex Corporation Nasdaq: AMPX $16.20
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
Ampex Reports Strong First Quarter; Present Prices Offer Investors Upside Leverage with Minimal Downside Risk; Strong Buy Reiterated
May 11, 2007. Ampex Corp. (NasdaqCM: AMPX) reports Strong First Quarter results that graphically illustrates Ampex's inherent leverage. We detail the results and reiterate the Strong Buy Rating and $35.00 price target.
Download Research Note
Ampex Corporation Nasdaq: AMPX $16.20
Research Note
Industry: Electronics & Engineering
Rating: Strong Buy (Reiterated)
Price Target: $35.00
By: Richard W. West, CFA
Ampex Announces Release Date of 1st Quarter 2007 Financial Results and Conference Call;Strong Buy Rating Reiterated
May 4, 2007. Ampex Corporation (NasdaqGM: AMPX) announced yesterday, May 3, 2007, that it will issue its preliminary unaudited first-quarter 2007 earnings release to the press after the markets close on Thursday, May 10, 2007.
Download Research Note
Applied NeuroSolutions Inc OTCBB: APNS $0.29
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $1.00
By: Denise T. Resnik, M.S.
Applied NeuroSolutions Raises Funds Through Exercise of Warrants
May 3, 2007. Applied NeuroSolutions (OTCBB: APNS) today filed an 8K announcing that, on April 27, 2007, the Company entered into a letter agreement by which several stockholders agreed to exercise their warrants to purchase 9,782,805 shares of the Company's common stock at a reduced exercise price of $0.17 per share. These warrants were originally issued in a private placement in February 2004 at an exercise price of $0.30 per share. Applied NeuroSolutions received $1,663,077 from the exercise of these warrants. The Company anticipates that its existing cash balances, coupled with funds received from the warrant exercises and from funds anticipated to be received from operations, should be adequate to fund operations through year-end 2007. Our current rating on the stock is Strong Speculative Buy.
Download Research Note
Biophan Technologies, Inc. OTCBB: BIPH $0.28
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Richard W. West, CFA
Biophan Technology, Inc. Announces Resignation of CEO and New Executive Committee to Oversee Operations; Comments on Breast Cancer Screening For Patients With Implantable Devices;
May 8, 2007. Biophan Technology, Inc. (OTCBB:BIPH) announces resignation of CEO And establishes Executive Committee to oversee the organization. Comments are presented on Biophan's technology applied to breast cancer screening for patients with implantable devices. Reiterate Neutral rating
Download Research Note
China Direct Inc. OTCBB: CHND $3.72
Research Report
Industry: Banks, Financial Services & Insurance
Rating: Strong Speculative Buy (Initial)
Price Target: $5.52
By: Stanley Ng
China Direct Strong Speculative Buy Rating In Initiating Coverage; Platform To Support, Develop and Nurture Business Opportunities Arising From The Opening Of Markets In China
May 15, 2007. China Direct (OTCBB: CHND) is a diversified management and consulting company with the mission to create a platform to support, develop and nurture business opportunities arising from the opening of markets in China. Management believes, and we concur, that the combined resources of its two major operating subsidiaries, China Direct Consulting and CDI China, will create a resource platform to offer a comprehensive suite of services critical to the success of Chinese entities that have good growth potential but lack sufficient working capital and management skill to expand their businesses. By taking advantage of an inefficient capital market in China and leveraging its connections and management skill, China Direct has successfully identified and acquired majority stakes in several quality Chinese entities with good growth potential. These include Chang Magnesium, a market leader in magnesium production; Lang Chemical, a third-party agent and distributor of synthetic chemicals in the Eastern China region; and CDI Wanda, a company using its proprietary system and technology to transform waste tires into distillate fuels. The recently announced 1Q07 results, with revenue of $31 million and net income of $1.9 million, underscored the success of China Direct's business model, and we believe such bullish trends will extend in the remaining quarters of FY2007 and well into FY2008.
Download Research Report
Clearant, Inc. OTCBB: CLRI $0.10
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Not Rated (Change)
Price Target: N/A
By: Sally H. Wallick, CFA
Clearant, Inc.: Update on Delayed 10-K.
May 6, 2007. Clearant, Inc. (OTCBB: CLRI): Clearant's 10-K filing was delayed while the Company raised needed capital. In early April, it secured approximately $2.2 million from a private placement. Since then, we believe that the Company's outside accountants have been in the process of auditing its books. We are hopeful that the audit will be completed shortly and that the 10-K will be filed by mid May (although management hasn't set forth a firm date for the filing) and that its first quarter 10-Q will be filed shortly after that. We expect Clearant to provide updates on recent business trends when the financial reports are filed. For now, the latest financial figures we have for Clearant are more than seven months old. Since their release, we believe that the Company has sharply reduced costs, while continuing to market its products and services. On the other hand, we do not know its cash burn rate at present or immediate cash requirements, and, therefore, it is unclear to what extent the recent capital infusion alleviated its financial pressures and for how long. As a result, despite our favorable view of the commercial potential for the Company's sterilized implant products, our rating on the shares remains suspended.
Download Research Note
Chilco River Holdings, Incorporated OTCBB: CRVH $0.50
Research Report
Industry: Leisure & Entertainment
Rating: Speculative Buy (Change)
Price Target: $0.75
By: Gerald F. LaKarnafeaux, CFA
Chilco River Raised To Speculative Buy Rating In Update Coverage; Completion of Potential Financing Will Allow Reopening of Bruce Hotel and Casino
May 8, 2007. Chilco River Holdings (OTCBB: CRVH) is currently offering, on a best-efforts basis, an issue of 11% convertible debentures. The amount of the offering is a range of $1.0 million to $10.0 million. Placing at least half of the offering will enable the Company to re-open the Bruce Hotel and Casino in August. Considering the earning potential of the Bruce facility, we believe our rating change from Neutral to a Speculative Buy, with a 12-month target price of $0.75 per share is warranted. For the year ending December 31, 2006, the Company reported revenues of $1.6 million, down from $4.6 million in the prior year. Total operating expenses, including depreciation of $752,000 were $4.6 million, up from 2005 operating expenses of $3.5 million including depreciation of $956,000. The net loss for the year was ($3.5 million) or ($0.07) per share, compared to a 2005 net profit of $581,383 or $0.01 per share. The Company's current cash position appears less precarious compared to year-end 2006 due to the convertible debenture offering. There is a factor to be considered in judging the liquidity risk. The scaled-down Bruce operation is still generating positive cash flow from the old slot machine rentals, hotel, food and beverage revenues. Bruce's net income is roughly at a breakeven level. The loss in 2006 is the result of G&A expenses at the corporate level.
Download Research Report
CardioVascular BioTherapeutics Inc OTCBB: CVBT $0.89
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Richard W. West, CFA
CardioVascular BioTherapeutics Files SEC Form 8-K;to Restate Financials
May 14, 2007. CardioVascular BioTherapeutics, Inc.'s (OTCBB:CVBT) filing of the SEC Form 8-K, dated May 11, 2007, details that certain financial statements should no longer be relied upon, due to an error with respect to the accounting for certain derivative instruments, which were previously recorded as equity transactions and which will be reclassified as derivative liabilities. This restatement will, in all probability delay Cardio's listing and its proposed offering in the Alternative Investment Market of the London Stock Exchange (AIM). We reiterate the Neutral Rating at this time.
Download Research Note
DXP Enterprises Inc Nasdaq: DXPE $47.88
Research Note
Industry: Industrial & Manufacturing
Rating: Buy (Change)
Price Target: $58.00
By: Paul J. Resnik, CFA
DXP Enterprises Announces Accretive Pump Supplier Acquisition and $10 Million Increase in Credit Facility; Raise Our Price Target from $56 to $58 and Reiterate Buy Rating
May 4, 2007. DXP Enterprises, Inc. (Nasdaq: DXPE) yesterday announced that it has entered into an agreement to acquire the business of Delta Process Equipment, Inc., a supplier of industrial and municipal pump equipment and services. DXP expects to complete the acquisition as soon as this week. Delta Process' territory stretches from Louisiana to Florida and north to Tennessee. DXP also announced it has increased its existing credit facility with Wells Fargo to $50 million from $40 million and extended the maturity date to July 31, 2010. We are raising our earnings per share estimates for DXP from $2.92 to $2.98 for 2007 and from $3.86 to $4.01 for 2008. We reiterate our Buy rating on the stock and are raising our 12-month price target from $56 to $58.
Download Research Note
Elron Electronic Industries LTD. Nasdaq: ELRN $16.86
Research Note
Industry: Electronics & Engineering
Rating: Buy (Reiterated)
Price Target: $18.50
By: Barry Raeburn
Elron Increases Stake In Largest Holding, Given Imaging (Nasdaq:GIVN)
May 15, 2007. Elron Electronic Industries Ltd. (NASDAQ & TASE: ELRN) announced today that it has purchased approximately 340,000 common shares of Given Imaging Ltd. (Nasdaq & TASE: GIVN), in a series of open market transactions for an aggregate purchase price of approximately $8.6 million. In parallel transactions, Discount Investment Corporation Ltd. ("DIC"), Elron's largest shareholder, purchased the same number of shares of Given Imaging for the same aggregate consideration, increasing its holding in Given Imaging from approximately 13.9% to approximately 15.1% of Given Imaging's outstanding ordinary shares. We maintain a high level of confidence in the growing value of the underlying group companies, including Given Imaging.At the current market value, we believe investors are still getting an inexpensive call option on the value of Elron's group of private companies and expect to see additional value generating catalysts on the horizon. We maintain our BUY recommendation and 12 month price target of $18.50.
Download Research Note
Elron Electronic Industries LTD. Nasdaq: ELRN $16.86
Research Note
Industry: Electronics & Engineering
Rating: Buy (Reiterated)
Price Target: $18.50
By: Barry Raeburn
Elron Continuing to Squeeze Out Value
May 2, 2007. Elron (Nasdaq: ELRN) announced sale of real estate assets for approximately $11.6 million. While relatively small relative to Elron's total NAV, each of these values are modestly higher that our previous estimates. We maintain our BUY recommendation and 12 month price target of $18.50.
Download Research Note
Evolution Petroleum Corporation AMEX: EPM $3.36
Research Report
Industry: Oil, Gas & Energy
Rating: Strong Buy (Reiterated)
Price Target: $4.67
By: Richard R. Wolfe, CFA
Evolution Petroleum Strong Buy Rating Maintained In Update Coverage; Strategic Opportunity In Enhanced Oil Recovery Processes
May 2, 2007. Evolution Petroleum (AMEX: EPM) is a development-stage oil and gas production company with considerable balance-sheet strength and a strategic opportunity in enhanced oil recovery processes. The Company's 13,000-acre Delhi Holt Bryant Unit in Monroe County, Louisiana is being redeveloped as a carbon-dioxide flood EOR project, a $200 million capital commitment in which Evolution will participate via a 25% reversionary interest and a 7% overriding royalty interest. The CO-2 project is operated by Denbury Resources (NYSE: DNR - $33.43) pursuant to a 2006 development agreement that included a $50 million upfront payment to Evolution. The Company is now cash-flow positive, and we estimate substantial cash-flow and earnings growth in 2008 - 2010. During those years, we expect proved reserves to reach 10x present levels as the CO-2 flood progresses across the Delhi Field. We value Evolution common stock at $4.67 per share, a premium of approximately 55% over present trading levels and accordingly reaffirm our rating of Strong Buy.
Download Research Report
Forgent Networks, Inc. Nasdaq: FORG $1.14
Research Note
Industry: Computers, Technology & Internet
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.40
By: Richard W. West, CFA
Forgent Networks; Patent Trial Begins; Direct TV Settles; Strong Speculative Buy Rating Reiterated
May 15, 2007. Forgent Networks, Inc. (NasdaqGM:FORG) settlement with Direct TV was announced at trial in U. S District Court for the Eastern District of Texas, Tyler Division. No details as to amount.
Download Research Note
George Foreman Enterprises Inc. Pink Sheets: GFME $3.46
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $4.00
By: Gerald F. LaKarnafeaux, CFA
George Foreman Enterprises Enters Into Agreement With In Stride LLC
May 9, 2007. George Foreman Enterprises Inc. (OTC: GFME) has entered into an agreement with InStride Ventures to market therapeutic shoes. This is the second venture to use the Foreman name and likeness. The Company continues to be in a noncompliant status with respect to the filing of its 10Q, 10K and 10Q for the 3rd quarter 2006, the year end 2006 and the first quarter of 2007. We beleive the Company will regain its Bulletin Board trading status within several months. Consequently we are rating the stock as a Speculative Buy with a 12 month target price of $4.50 per share
Download Research Note
Green Plains Renewable Energy NasdaqNM: GPRE $20.61
Research Report
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $60.00
By: Paul J. Resnik, CFA
Green Plains Renewable Energy Rated Strong Speculative Buy In Update Coverage; EPS Forecast at $1.44 in FY '07 and $4.98 in FY '08; Target Price Raised To $60
May 3, 2007. Green Plains (Nasdaq: GPRE) is currently building two 50-million-gallon dry mill ethanol plants in Shenandoah, Iowa and in Superior, Iowa, producing also 176,000 tons of animal feed. The Shenandoah plant is scheduled to be completed by mid-2007, and the Superior plant 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 higher prices, for corn. Ethanol prices have firmed recently, and the current June Chicago Board of Trade (CBOT) contract price of $2.14/gallon remains above the $2.00 level upon which we have based our earnings projections. We continue to believe that corn prices will be in the $3.00 - $3.50 area later this year if decent weather holds up during the current planting period. Assuming that ethanol prices will stabilize in the $2.00/gallon area and that CBOT corn prices will eventually fall back towards $3.25/bushel and based on our projected start-up dates for Shenandoah and for Superior, we believe Green Plains will turn profitable in the third quarter of 2007, and we estimate earnings per share of $1.44 in 2007 and $4.98 for 2008. Using a price/earnings multiple of 12 for 2008 estimated earnings (25% discount to a market multiple) generates a 12-month $60 price target.
Download Research Report
Harbin Electric, Inc. Nasdaq: HRBN $13.28
Research Note
Industry: Industrial & Manufacturing
Rating: Speculative Buy (Change)
Price Target: $16.02
By: Stanley Ng
Harbin Electric Develops The World's First High Efficiency, Energy Saving Oil Pump Driven by Linear Motor; Reiterate Speculative Buy Rating
May 10, 2007. Harbin Electric, Inc. Announced on May 10, 2007 That It Has Successfully Developed The World's First High Efficiency, Energy Saving Oil Pump Driven by Linear Motor
Download Research Note
HydroGen Corporation NasdaqCM: HYDG $4.28
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $8.25
By: Sally H. Wallick, CFA
Hydrogen Corporation Reports 1Q Results; Makes Progress on Business Plan: Speculative Buy Reiterated.
May 10, 2007. HydroGen Corporation (Nasdaq: HYDG) reported 1Q 2007 demonstration grant revenue of $436,065 and an operating loss of $3.1 million or $0.25 per share. Since HydroGen is a development stage company transitioning to commercialization of its technology, we do not believe that current results reflect the Company's long-term potential. HydroGen has made steady progress on its business plan. We believe that the Company's 2007 goals include successfully demonstrating its fuel cell technology in the field; negotiating one or more financial partnerships so that it can offer potential customers a broader array of financing options, including operating leases; and building a large backlog of orders. We rate HydroGen's shares Speculative Buy.
Download Research Note
HydroGen Corporation NasdaqCM: HYDG $4.28
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; First Quarter Previewed
May 4, 2007. Hydrogen Corp. (NASDAQ: HYDG): We expect HydroGen to report first quarter results by the middle of May. 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. Noteworthy developments thus far in 2007 include mechanical completion of a test facility, further strengthening of the Company's management team and Board, and trading of the Company's shares on NASDAQ. 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 a development-stage company that is transitioning to commercialization of its technology and is not yet profitable.
Download Research Note
International Barrier Technology Inc OTCBB: IBTGF $0.41
Research Note
Industry: Industrial & Manufacturing
Rating: Strong Speculative Buy (Change)
Price Target: $0.84
By: Gerald F. LaKarnafeaux, CFA
International Barrier Reports a 85% Increase in Commercial Modular Sales for the March Quarter.
May 10, 2007. International Barrier Technology (OTCBB:IBTGF) released its March quarter sales. Commercial Modular volume sales and revenue were up 64% and 85%, respectively. Multi-family roof deck sales were down in the quarter.
Download Research Note
InkSure Technologies Inc OTCBB: INKS $1.85
Research Note
Industry: Electronics & Engineering
Rating: Speculative Buy (Reiterated)
Price Target: $3.50
By: Rafael K. Kapelinski
InkSure: InkSure has reported slightly lower than expected 1Q 2007 results.
May 15, 2007. InkSure (OTCBB: INKS) has reported slightly lower than expected 1Q 2007 results. Revenues came in at USD 0.7 million (-12.1% over the previous quarter and plus 30% year-on-year) and EPS was USD (0.06). Our estimates are under revision. We will most likely lower our 2007E revenue estimate without lowering the EPS as the Company's margin performance was very strong: the gross margin was better than expected at 63.4% due to the growing high margin ink sales. The valuation, however, remains rather aggressive and we believe that the share price may experience some weakness in the short term.
Download Research Note
IntegraMed America Inc NasdaqNM: INMD $12.72
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Buy (Reiterated/Update)
Price Target: $12.00
By: Richard W. West, CFA
IntegraMed America Inc.'s Price Target Adjusted for 25% Stock Dividend; Strong Buy Rating Reiterated
May 9, 2007. IntegraMed America Inc.'s (NasdaqGM:INMD) Price Target Adjusted for 25% Stock Dividend.
On March 19, 2007, IntegraMed's Board of Directors declared a 25% stock split in the form of a stock dividend, with a record date of April 13, 2007, payable on May 4, 2007. We are maintaining our Strong Buy rating, reflecting the 25% stock dividend, and we are adjusting our 12-month target price to $12.00 per share.
Download Research Note
IntegraMed America Inc NasdaqNM: INMD $12.72
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Buy (Reiterated/Update)
Price Target: $12.00
By: Richard W. West, CFA
IntegraMed America, Inc.'s First Quarter Results Reviewed;Strong Buy Rating Reiterated
May 7, 2007. IntegraMed America, Inc.'s (NasdaqGM:INMD) We see the quarter as a positive start to FY2007, and look for increases in revenue and contributions in the balance of the year from the new Affiliate and the new Partner. Increased revenue, increased net income, increased EBITDA, decreased expenses, higher margins, a strong balance sheet with $33.0 million in cash, a lower tax rate at 33%, and an increase in stockholders' equity all make IntegraMed an attractive growth investment. We reiterate the Strong Buy Rating and JM Dutton's price target of $15.00 per share.
Download Research Note
Index Oil and Gas, Inc. OTCBB: IXOG $1.17
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $1.80
By: Richard R. Wolfe, CFA
Index Oil and Gas Expands Presence in South Texas
May 4, 2007. On April 23rd and 24th, Index Oil and gas (Nasdaq: IXOG) provided additional information that we view as further confirmation of our favorable investment thesis for the Company. In the first disclosure, management indicated that both of its shallow exploration wells in Goliad and Victoria Counties (South Texas) have been completed successfully.
Download Research Note
LJ International Inc. NasdaqNM: JADE $11.66
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $16.00
By: Sally H. Wallick, CFA
LJ International: Easing of Investment Restrictions in China Could Draw New Funds to Shares.
May 14, 2007. LJ International Inc. (NasdaqGM: JADE): Shares of LJ International (LJI) have been strong in recent trading, rising more than 20% since closing at $10.28 per share on Monday, May 7, including an intraday increase of almost 8% at one point today (Monday, May 14) on heavy volume. We believe that a change in investment rules in China could be contributing to today's move in the share price. On Friday, the China Banking Regulatory Commission said that it had removed equity investment restrictions on mainland China banks, allowing them to invest up to 50% of the net value of their offshore investments in stocks. Qualified individual bank customers can invest a minimum of approximately $39,000 in offshore stocks. Some market experts believe that these changes could be especially beneficial for Hong Kong blue chips and other China-related stocks. We rate LJI's shares Spe
Download Research Note
LJ International Inc. NasdaqNM: JADE $11.66
Research Note
Industry: Consumer & Retail Products
Rating: Speculative Buy (Reiterated)
Price Target: $16.00
By: Sally H. Wallick, CFA
LJ International: Comment on Reporting Delay.
May 7, 2007. LJ International (Nasdaq: JADE) has not yet reported 4Q and full year 2006 results, despite sharply raising revenue and earnings guidance for both periods in mid February and announcing plans to accelerate retail expansion (see Dutton Associates note dated February 15, 2007 for more details). As a foreign filer, LJI is not required to report results by a set date. However, in recent years, the Company has reported on a schedule consistent with domestic filers. Management has not said when it expects to report 4Q and full year 2006 or 1Q 2007 results. Nor has it commented on why the 2006 earnings report has been delayed. Based on the latest information from LJI, it appears that the Company finished 2006 with strong revenue and earnings momentum. In addition, in mid February, in conjunction with raising guidance, management said that, given ENZO's strong performance, it expects LJI to achieve record revenue and profit in 2007. Therefore, we are maintaining our estimates for LJI and our Speculative Buy rating on its shares, while pointing out the "anomaly" of the delay in its financial reports.
Download Research Note
Joystar Inc. OTCBB: JYSR $0.82
Research Note
Industry: Leisure & Entertainment
Rating: Strong Speculative Buy (Reiterated)
Price Target: $1.50
By: Richard W. West, CFA
Joystar Inc. Announces Record Sign-up of Agents in April; Reiterate Strong Speculative Buy and $1.50 Price Target
May 4, 2007. Joystar, Inc. (OTCBB: JYSR) announced that it experienced a record month of signing on new agents in April 2007. The record rate of leisure travel agents and agencies coming to Joystar bodes well for continued revenue growth and earnings. We reiterate our Strong Speculative Buy Rating and our 12-month price target of $1.50 per share.
Download Research Note
Lime Energy Co. OTCBB: LMEC $1.03
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Lime Energy Co. Successfully Completes Energy Efficiency Project for Major California Utility;Strong Speculative Buy Reiterated
May 10, 2007. Lime Energy Co. (OTCBB:LMEC) announced on May 10, 2007, the completion of a comprehensive energy efficiency retrofit project at four facilities owned by a major California utility. Lime Energy has integrated its three subsidiaries and is building on the success of each project. We reiterate our Strong Speculative Buy and $2.00 per share price target.
Download Research Note
Lime Energy Co. OTCBB: LMEC $1.03
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.00
By: Richard W. West, CFA
Lime Energy Releases and Comments on First-Quarter FY2007; Strong Speculative Buy Reiterated
May 7, 2007. On May 7, 2007, Lime Energy Co. (OTCBB:LMEC) released its first-quarter 2007 operating results, the first full quarter of results since the reorganization of Lime Energy with its three operating units, The onetime non-recurring items that totaled $1.4 million and affected the increase in operating loss for the quarter, are now behind Lime Energy, and we expect improvement in the operating results and net income for the balance of the year. Lime Energy has scheduled a conference call for May 9, 2007, and we will revisit the Q1 FY2007 results after that call. We reiterate our Strong Speculative Buy Rating and $2.00 price target.
Download Research Note
LESCO, Inc. NasdaqNM: LSCO $14.50
Research Note
Industry: Consumer & Retail Products
Rating: Neutral (Reiterated)
By: Paul J. Resnik, CFA
LESCO Shareholders Approve Acquisition by Deere
May 4, 2007. LESCO, Inc. (Nasdaq: LSCO) announced that, at its special meeting of shareholders held yesterday, the Company's shareholders approved the proposed acquisition at a price of $14.50 by Deere & Company (NYSE: DE). We believe the deal will close tomorrow or Monday.
Download Research Note
Lantronix, Inc. Nasdaq: LTRX $1.29
Research Note
Industry: Electronics & Engineering
Rating: Strong Speculative Buy (Reiterated)
Price Target: $2.50
By: David P. Soetebier, CFA
Lantronix FY Third Quarter Results Below our Estimate; No Change In Our Positive Outlook For The Company
May 4, 2007. Lantronix (Nasdaq: LTRX), a leading provider of machine to machine (M2M) networking devices reported fiscal third quarter (ended March 31) results with good growth in its Device Enablement business but lower than estimated sales of Device Management products. Device Enablement revenues grew 14% year over year (YoY) to $9 .9 million but Device Management revenues decreased 10% YoY to $1.7 million. The Device Management business had reported a very strong December 2006 quarter and we had expected the momentum to carry into the March quarter. Although the March quarter was disappointing versus our estimates it does not change our positive outlook for the Company. With Lantronix having introduced 20 new products in the past 12 months we believe the factors are in place to drive accelerating growth going forward. Unfortunately, the timing of when Lantronix's customers build up production of systems that include LTRX components or systems can't be predicted. We are maintaining our Strong Speculative Buy on the stock with a target of $2.50.
Download Research Note
Maine & Maritimes Corporation AMEX: MAM $27.35
Research Note
Industry: Oil, Gas & Energy
Rating: Buy (Reiterated/Update)
Price Target: $35.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation: Management and Board Changes Reviewed. Buy Rating Reiterated.
May 13, 2007. Maine & Maritimes Corporation (AMEX: MAM): Michael Williams resigned as Maine & Maritimes' Interim Chief Operating Officer and Interim Director effective May 8, 2007, while remaining the Company's Senior Vice President (SVP), Chief Financial Officer (CFO) and Assistant Secretary and SVP and CFO of Maine Public Service (MPS), its regulated electric utility. Mr. Williams had held the interim positions since the resignation of Maine & Maritimes Chief Executive Officer (CEO), J. Nicholas Bayne, in August 2006. Mr. Williams was replaced on Maine & Maritimes' Board of Directors by Brent Boyles, who also became the Company's President and CEO on May 8, 2007, while retaining the positions of President and CEO of MPS. Prior to Mr. Boyles adding these new responsibilities, one of the Company's long-time Directors, Nathan L. Grass, was Interim President and CEO. We believe that Mr. Williams resignation from the interim positions is a logical transition now that the CEO position has been filled and will allow him to focus on his financial responsibilities as the Company's divests its unregulated businesses and pursues growth opportunities for the regulated utility. We rate Maine & Maritimes common shares a Buy.
Download Research Note
Maine & Maritimes Corporation AMEX: MAM $27.35
Research Note
Industry: Oil, Gas & Energy
Rating: Buy (Reiterated/Update)
Price Target: $35.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation: EPS Estimates and Target Price Raised in Wake of Strong 1Q. Buy Reiterated.
May 10, 2007. Maine & Maritimes Corporation (AMEX: MAM): On May 8, 2007, Maine & Maritimes filed its first quarter 2007 10-Q. Previously, we discussed the quarter in a Dutton Associates note dated May 7, 2007. However, the 10-Q provided additional details on the period's operating results, cash flow and financial position. Highlights include well controlled operating expenses, strong earnings before interest, taxes, depreciation and amortization (EBITDA), and strong cash flow generation, which allowed the Company to repay some debt. First quarter earnings from continuing operations of $0.94 per diluted share came in well ahead of our $0.63 per share estimate. Therefore, we are raising our 2007 and 2008 earnings estimates from $0.70 and $1.15 per share to $0.95 and $1.30 per share, respectively. In addition, we are raising our 12-month target for the shares from $28 per share to $35 per share. We reiterate out Buy rating on Maine & Maritimes' shares.
Download Research Note
Maine & Maritimes Corporation AMEX: MAM $27.35
Research Note
Industry: Oil, Gas & Energy
Rating: Buy (Reiterated/Update)
Price Target: $35.00
By: Sally H. Wallick, CFA
Corrected: Maine & Maritimes Corporation: 1Q Earnings from Continuing Operations Double Year Over Year; Estimates and Target Likely to Be Raised. Buy Reiterated.
May 7, 2007. Maine & Maritimes Corporation (AMEX: MAM): Maine & Maritimes reported first quarter regulated operating revenues of $10.915 million, up 9% year over year, and net income from continuing operations of $1.6 million, or $0.94 per diluted share, double last year's $0.47 per share. Earnings came in well ahead of our $0.63 per share estimate. Including a loss from discontinued operations, earnings were $0.81 per diluted share, versus $0.32 per share last year. During the first quarter, Maine & Maritimes announced plans to divest its unregulated operations and return to a focus on its regulated business, Maine Public Service Company (MPS). As a result, its unregulated businesses were reclassified as discontinued operations. We consider this strategic refocus a positive development with the potential to improve financial performance and enhance shareholder value long term. As discussed in a Dutton Associates report dated April 24, 2007, we believe that MPS's long-term growth prospects have brightened as a result of significant changes in the electric utility industry in recent years. Following the announcement of Maine & Maritimes' change in strategic direction, the Company named Brent Boyles President and CEO. He continues to serve as President and CEO of MPS. In light of the better-than-projected first quarter results, we expect to raise our 2007 and 2008 diluted earnings estimates for Maine & Maritimes and our current 12-month target price of $28 per share. However, we will wait to review and perhaps revise these numbers until the Company's 10-Q, with its more detailed financial information, is available. We reiterate our Buy rating on Maine & Maritimes common stock.
Download Research Note
Maine & Maritimes Corporation AMEX: MAM $27.35
Research Note
Industry: Oil, Gas & Energy
Rating: Buy (Reiterated/Update)
Price Target: $35.00
By: Sally H. Wallick, CFA
Maine & Maritimes Corporation First Quarter Results Previewed.
May 4, 2007. Maine & Maritimes Corporation (AMEX: MAM): We expect Maine & Maritimes to report first quarter 2007 results by mid May. We project a 3% year-over-year revenue increase at MPS and diluted earnings from continuing operations of $0.63 per share, up 17% versus a year ago. We expect diluted earnings including a loss from discontinued operations to be lower than this estimate. Our confidence in specific projections is low for two reasons: management does not provide guidance and, given the Company's modest share count (about 1.7 million shares), relatively small changes in income can have a meaningful effect on earnings per share. We consider Maine & Maritimes' refocus on the regulated business, which was announced in March, a positive development with the potential to improve financial performance and enhance shareholder value long term. As discussed in a Dutton Associates report dated April 24, 2007, we believe that MPS's long-term growth prospects have brightened as a result of significant changes in the electric utility industry in recent years. Following the announcement of Maine & Maritimes' change in strategic direction, the Company named Brent Boyles President and CEO. He will assume these responsibilities on May 8, 2007, while continuing to serve as President and CEO of MPS. We reiterate our Buy rating on Maine & Maritimes common stock.
Download Research Note
MortgageBrokers.com Holdings OTCBB: MBKR $0.78
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard W. West, CFA
MortgageBrokers.com Announces Alliance With Wells Fargo Financial Corporation Canada; Speculative Buy Reiterated
May 14, 2007. MortgageBrokers.com (OTCBB:MBKR) announced on May 14, 2007, entering into a strategic partnership, through which Wells Fargo Financial Canada will provide dedicated resources and exclusive financial products to MortgageBrokers.com. We reiterate our recently raised rating from Neutral to Speculative Buy and the price target of $1.00 per share.
Download Research Note
MortgageBrokers.com Holdings OTCBB: MBKR $0.78
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard W. West, CFA
MortgageBrokers.com Corrects 3-for-1 Stock Dividend Information; Reiterate Speculative Buy and $1.00 Price Target
May 11, 2007. MortgageBrokers.com (OTCBB: MBKR), in an announcement on May 11, 2007, corrected details of the May 7, 2007, announcement regarding its common shares forward split, and they appear to be going ahead with its 3-for-1 stock dividend.
Download Research Note
MortgageBrokers.com Holdings OTCBB: MBKR $0.78
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard W. West, CFA
MortgageBrokers.com Stock Hits New 52-Week Low; Increasing Rating to Speculative Buy; Setting Price Target of $1.00
May 9, 2007. MortgageBrokers.com's (OTCBB: MBKR ) common stock has been on a roller coaster ride, since April 26, 2007. With pertinent factors in mind, we are raising the rating from the Neutral established on April 29, 2007, when the stock jumped above $2.00 per share, to a Speculative Buy and setting a price target of $1.00 per share.
Download Research Note
MortgageBrokers.com Holdings OTCBB: MBKR $0.78
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard W. West, CFA
MortgageBrokers.com Makes Additional Announcements; Signing New License Agreements and Considering Forward Stock Dividend; Neutral Rating Reiterated After Price Rise
May 7, 2007. MortageBrokers.com (OTC:BB:MBKR) continues to make announcements, stock eases back from recent explosion high. We reiterate our Neutral Rating but are reviewing rating vis--vis price.
Download Research Note
MortgageBrokers.com Holdings OTCBB: MBKR $0.78
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard W. West, CFA
MortgageBrokers.com SEC Form 10K Information; Summary of Additional News Releases
May 2, 2007. MortgageBrokers.com Holdings Inc. (OTCBB: MBKR) Since our last Research Note, dated April 29, 2007, MortgageBrokers.com has announced several key actions, including regulatory approval to begin operations in British Columbia; retaining the Thomas Law Firm of Dallas, Texas, to begin the licensing process for operation within the United States; an agreement with Seaway Mortgage Partners, Inc. of Kingston, Ontario and provided revenue guidance of CAD$40.0 million. Considering that MortgageBrokers.com's revenue in the fourth quarter of FY2006 was approximately U.S.$1.4 million and for the full FY2006 was U.S.$4.0 million, we are maintaining our estimate of U.S.$24.0 million for FY2006 and our Neutral Rating.
Download Research Note
MediciNova, Inc. NasdaqGM: MNOV $9.37
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated)
Price Target: $20.00
By: Wayne M. Lottinville, CFA
MediciNova Reports Financial Results, Clinical Progress; Reiterate Strong Speculative Buy
May 11, 2007. MediciNova, Inc. (NasdaqGM: MNOV; Osaka: 4875), reported a net loss of $15.9 million, or $1.40 per share, for the first quarter of 2007, compared to a net loss of $8.4 million, or $0.85 per share, for the same quarter a year earlier. Compared to 1Q06, R&D expenses increased $6.4 million to $14.2 million. The increased loss was primarily due to higher costs associated with the advancement of MediciNova's clinical development programs and additional staffing requirements. MediciNova's management also said that the Company is planning to soon advance MN-166 into Phase 3 clinical testing and unblind data from the Company's status asthmaticus and insomnia programs.
Download Research Note
Memry Corporation AMEX: MRY $1.90
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Memry Corporation: Quarterly Highlights Reviewed Ahead of Conference Call.
May 10, 2007. Memry Corporation (AMEX: MRY) reported third quarter fiscal 2007 results after the close on May 9. Following a conference call the morning of May 10, we will issue a detailed analysis of the quarterly results and review our estimates. In the meantime, in this note, we point out a few highlights of the quarterly report, including unexpected weakness in polymer products revenue, strong cash flow, debt repayments and a more aggressive acquisition strategy. Our rating on the Company's shares remains Neutral.
Download Research Note
Memry Corporation AMEX: MRY $1.90
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Memry Corporation Reports 3Q Loss; Estimate Cut; Neutral Rating Reiterated.
May 10, 2007. Memry Corporation (AMEX: MRY) reported a 12.7% decline in third quarter fiscal 2007 revenue to $12.2 million and a net loss of $460,000, or $0.02 per share, compared with net income of $1.52 million, or $0.05 per share, in the third quarter of fiscal 2006. Revenue fell short of our estimate, and the loss slightly exceeded our projection of a $0.01 per share loss. Revenue declined at both the nitinol and the polymer products segments. The drop in polymer products segment revenue, which was unexpected, is attributable in part to an inventory adjustment by a customer that substantially reduced purchases relative to a year ago. Taking into account Memry's third quarter results, we are reducing our full-year fiscal 2007 diluted earnings estimate for Memry from a $0.01 per share profit to breakeven. This compares with $0.11 per share in fiscal 2006 excluding a one-time separation charge that reduced earnings $0.02 per share. In addition, we are lowering our fiscal 2008 estimate from $0.05 per share to $0.04 per share. Management noted that during the third quarter the Company embarked on a more proactive acquisition strategy. Its objective is to complete an acquisition in fiscal 2008. However, in light of the uncertainty inherent in the acquisition strategy, our fiscal 2008 estimate does not take into account an acquisition. We believe that Memry's long-term prospects are bright for the reasons detailed in a Dutton Associates report dated October 26, 2006. Nevertheless, in light of the uninspiring near-term earnings outlook, we are maintaining our Neutral rating on the Company's shares.
Download Research Note
Memry Corporation AMEX: MRY $1.90
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Neutral (Reiterated)
By: Sally H. Wallick, CFA
Memry Corporation to Report 3Q Earnings on May 9; Neutral Rating Reiterated.
May 2, 2007. Memry Corporation (AMEX: MRY) plans to report third quarter fiscal 2007 results after the stock market closes on Wednesday, May 9. In conjunction with reporting second quarter earnings in February, Memry's management cautioned that it expected weakness in the Company's nitinol revenue and margins to continue for the rest of the fiscal year and that investment in the polymer products segment's manufacturing growth would continue to affect near-term profitability. Taking into account Memry's second quarter results and management's comments, we project a diluted third quarter loss of $0.01 per share, compared with earnings of $0.05 per share in the third quarter of fiscal 2006. However, our confidence in quarterly projections for Memry is below average since management typically provides no intraquarter guidance on revenue, margin and cost trends and Memry's quarterly results can be volatile. We believe that Memry's long-term prospects are bright for the reasons detailed in a Dutton Associates report dated October 26, 2006. Nevertheless, in light of the uninspiring near-term earnings outlook, we are maintaining our Neutral rating on the Company's shares.
Download Research Note
Neurobiological Technologies Inc. NASDAQ: NTII $2.03
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $6.00
By: Denise T. Resnik, M.S.
Neurobiological Technologies Reports $1.9 Million Quarterly Payment for Sales of Memantine; Reiterate Strong Speculative Buy
May 3, 2007. Neurobiological Technologies, Inc. (Nasdaq: NTII), yesterday announced it received approximately $1.9 million from Merz Pharmaceuticals GmbH for sales of Memantine for the treatment of moderate-to-severe Alzheimer's disease for the quarter ended December 31, 2006. This reported payment is in line with the $1.9 million estimate we published in our April 23, 2007 report and was the largest single royalty payment received to date from Merz. We reiterate our Strong Speculative Buy rating.
Download Research Note
Online Vacation Center Inc. OTCBB: ONVC $2.15
Research Note
Industry: Leisure & Entertainment
Rating: Speculative Buy (Reiterated)
Price Target: $3.25
By: Richard W. West, CFA
Online Vacation Center Holdings Corp. Files 1st Quarter SEC Form 10QSB; Results in Line With Expectations;
Speculative Buy Reiterated
May 15, 2007. Online Vacation Center Holdings Corp. (OTCBB:ONVC) filed its SEC Form 10QSB for its first quarter-ended March 31, 2007. With the exception of the selling and marketing expenses, the overall results were in line with our FY2007 estimates of $10.0 million revenue and diluted EPS of $0.01. We believe the company will acquire recognition as investors become acquainted with Online Vacation Center and its potential as a growth company focused on building a network of diversified vacation marketers with a range of products that can be cross-sold to an extensive customer base. We reiterate our Speculative Buy Rating and our 12-month price target of $2.50 per share.
Download Research Note
O2Diesel Corp AMEX: OTD $0.57
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $2.25
By: Sally H. Wallick, CFA
O2Diesel Corporation Quarter Previewed; Recent Developments Highlighted; Speculative Buy Rating Reiterated.
May 4, 2007. O2Diesel Corporation (AMEX: OTD): We expect O2Diesel to report first quarter 2007 results by mid May. We anticipate a quarter similar to those reported in recent periods, with modest revenue and a small loss. To date, 2007 has been a very active period for O2Diesel highlighted by a number of important developments, including: (1) The signing of a definitive agreement to acquire 80% of ProEco Energy Company, Inc., which is developing an ethanol plant in South Dakota.; (2) The negotiation of a $10-million stock purchase agreement with Fusion Capital; (3) The announcement of a supply agreement with Fair Energy S.A. to jointly develop markets in certain South American countries and Switzerland for O2Diesel(TM); (4) The receipt of an additional $1 million of Department of Defense (DoD) funding and the initiation of field tests of a new renewable fuel, O2Biodiesel, that is being developed for the DoD; (5) The addition of a third school bus fleet to O2Diesel's CityHome(TM) School Bus Program; and (6) The receipt of orders for more than 70,000 liters of the Company's proprietary additive technology from Energenics, its Asian distribution partner. These developments are discussed in more detail in a Dutton Associates report dated March 14, 2007 and/or in Dutton Associates notes. We will provide a more detailed update following filing of the first quarter 10-Q. In the meantime, we reiterate our Speculative Buy rating on the Company's common stock.
Download Research Note
Pacific Asia China Energy Inc. CDNX: PCE $0.58
Research Note
Industry: Oil, Gas & Energy
Rating: Speculative Buy (Reiterated)
Price Target: $1.00
By: Richard R. Wolfe, CFA
Pacific Asia China Energy Updates Operations, Dutton Adjusts Estimates
May 6, 2007. Pacific Asia China Energy (TSX: PCE) has provided additional details about its operations, particularly its coalbed methane (CBM) play in China, and also its Chinese coal mine degasification program as well as corporate finance developments for the Company. Dutton's assessment of management's disclosures indicates a somewhat longer development period for the Company's CBM program. Accordingly, we have revised our estimates of cash flow and earnings.
Download Research Note
Pacific Ethanol, Inc. NasdaqNM: PEIX $15.04
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated/Update)
Price Target: $24.80
By: Paul J. Resnik, CFA
Pacific Ethanol Reports Strong First Quarter; Reiterate Strong Speculative Buy Rating
May 11, 2007. Pacific Ethanol, Inc. (NasdaqGM: PEIX) reported first quarter results after the close of trading on May 9. Higher than expected net sales of $99.2 million (our estimate $91.0 million) reflected an above estimate realized ethanol price of $2.34 (vs. our projection of $2.15). Although earnings per share of $0.05 was $0.01 below our estimate, the Company noted that "Several costs totaling $1.7 million were unique to the quarter." Accordingly, we are raising our full year 2007 EPS estimate from $0.32 to $0.37 to reflect both the higher ethanol prices and the expectation that SG&A expenses relative to sales will improve as the year progresses. For now, we are maintaining our 2008 EPS estimate of $1.24. This estimate assumes that ethanol prices remain above $2.00 and that corn prices continue to ease back as confidence grows regarding the 2007-2008 crop year acreage planted and yield. Recognizing that commodity fluctuations can interrupt a rising earnings price trend from time to time, we believe Pacific Ethanol and the ethanol in business in general should be viewed as having strong growth characteristics. Well-run ethanol producers should be able to adjust to changing feedstocks in the future and benefit from the trend to greater use of alternative fuels. We believe Pacific Ethanol is particularly well-positioned to benefit from growing ethanol demand in California and other parts of the Western United States. With this in mind, we these shares should be priced at a premium to the overall market. Assigning a 20 multiple on our 2008 EPS estimate, we generate a 12-month price target of $24.80 and maintain our Strong Speculative Buy recommendation on the shares.
Download Research Note
PacificHealth Laboratories Inc. OTCBB: PHLI $2.15
Research Report
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $2.75
By: Jonathan H. Ziegler, CFA
PacificHealth Laboratories Rated Speculative Buy In Update Coverage; Cadbury Schweppes Americas Beverage Established Purchase Agreement With Multifaceted Positive Impact On The Company
May 2, 2007. PacificHealth Laboratories (OTCBB: PHLI) reported fourth-quarter and year-end 2006 results which included better-than-expected sales but below-estimate EPS. Reported sales for the fourth quarter of $1.113 million were up 51.4% from the fourth quarter a year ago and comfortably exceeded our projection of $956,000. Sales reported for the year were $6.210 million. Fourth quarter EPS were ($0.03), down from $0.07 in the fourth quarter of 2005 and below our estimate of break-even. EPS reported for the 2006 year were $0.18, which largely represented the transaction with Cadbury Schweppes Americas Beverage (CSAB) in the first quarter. CSAB established an asset purchase agreement with PacificHealth with an initial fee of $4 million in the first quarter, had a multifaceted positive impact on the Company, including the buttressing of the balance sheet and elimination of long-term debt; the prospective and imminent roll-out of the RTD line of the Company's ACCELERADE sports drinks; a royalty stream to PacificHealth as sales are developed; and a royalty-free license permitting PacificHealth to produce and sell ACCELERADE and ENDUROX in powdered and gel form. The real positive, of course, is the prospect of a large consumer product company's marketing machine working for PacificHealth. Just last month, PacificHealth modified the agreement to allow the Company to expand its sales into additional international markets.
Download Research Report
PacificHealth Laboratories Inc. OTCBB: PHLI $2.15
Research Note
Industry: Healthcare, Biotechnology & Pharmaceutical
Rating: Speculative Buy (Reiterated)
Price Target: $2.75
By: Jonathan H. Ziegler, CFA
PacificHealth Labs First Quarter Sales Comfortably Exceed Our Estimate
May 2, 2007. PacifiHealth Labs, Inc. (OTCBB: PHLI) reported first quarter 2007 results this morning. Reported revenues of $1.82 million exceeded our estimate of $1.75 million. The reported loss per share of ($0.02) compared with our estimate of ($0.01). The higher-than-expected loss was driven by mark-downs of old (labeled) inventory and expenses related to the launch of a brand new product, Satiatrim.
Download Research Note
Pointer Telocation Nasdaq: PNTR $11.36
Research Note
Industry: Business & Support Services
Rating: Strong Buy (Reiterated)
Price Target: $18.00
By: Rafael K. Kapelinski
Pointer Telocation: 1Q 2007 Preview
May 15, 2007. Pointer Telocation (Nasdaq: PNTR) will report 1Q 2007 results on Thursday, May 17. We expect revenues of USD 11.06 million and EPS of USD 0.07. In our view, the key issues concerning the Company's valuation include the working capital situation, the status of the recent acquisitions in Latin America, and the strength of the car market in Israel. We reiterate our Strong Buy rating as we believe that the valuation does not appear too demanding.
Download Research Note
Patriot Scientific Corp. OTCBB: PTSC $0.51
Research Note
Industry: Electronics & Engineering
Rating: Neutral (Reiterated)
By: Richard W. West, CFA
Patriot Scientific Announces License for Leading Worldwide Manufacturer of Mobile Devices and Mobile Networks; Neutral Rating Reiterated
May 7, 2007. Patriot Scientific (OTCBB:PTSC) announced that Nokia Corp. (NYSE:NOK) purchased a license that gives it the right to use technologies protected by the Moore Microprocessor Patent™ Portfolio (MMP Portfolio). Nokia is a world leading manufacturer of mobile devices and mobile networks. We comment on Patriot's Annual Meeting and the recent Markman Hearing. We reiterate our Neutral Rating.
Download Research Note
Pro Travel Network, Inc. OTCBB: PTVL $0.52
Research Note
Industry: Leisure & Entertainment
Rating: Speculative Buy (Initial)
Price Target: $2.00
By: Richard W. West, CFA
Pro Travel Networks, Inc. Announces New CEO; Confirms Continuing Growth in Revenue; Speculative Buy Reiterated
May 8, 2007. Pro Travel Network, Inc. (OTCBB: PTVL) (Pro Travel) announced on May 7, 2007,the appointment of Mr. Ray Lopez as the new Chief Operating Officer and Vice President. Management notes in the May 7, 2007, news release that Pro Travel continues to steadily grow and increase revenue from their marketing efforts and that they are experiencing exponential growth in all their regions, especially in Canada. We reiterate our Speculative Buy Rating and 12-month price target of $2.00 per share.
Download Research Note
Questar Assessment, Inc. OTCBB: QUSA $5.00
Research Report
Industry: Publishing & Media
Rating: Buy (Reiterated)
Price Target: $8.00
By: Sally H. Wallick, CFA
Questar Assessment Rating Maintained At Buy; Trading At Only 4.5x Projected Fiscal 2007 EBITDA Versus 16.3x For 19 Other Industry Members
May 3, 2007. Questar Assessment (OTCBB: QUSA) provides educational testing and assessment tools and services, mainly for primary-school and secondary-school systems. The educational testing market has shifted away from standardized tests and toward custom test products and services. Early in 2002, this trend was given a boost by the passage of No Child Left Behind (NCLB) legislation. In May 2006, the Company's strategic shift to custom products and services culminated in its acquisition of Questar Educational Systems (QES). Questar Educational Systems' operational strengths complement Touchstone's development capabilities, allowing the combined Company to provide the entire spectrum of assessment services for large, state-level contracts for the first time. QUSA reported a more than doubling of fiscal 2006 revenue year over year to $23.7 million. Q1 fiscal 2007 revenue more than a tripled year over year to $9.6 million, as a result of a $5.9 million revenue contribution from Questar Educational Systems and 20% revenue growth at its pre-acquisition businesses, and EBITDA totaled $442,000 or $0.09 per share. We are maintaining our fiscal 2007 estimate of a $0.06 diluted EPS loss for the Company, largely a result of incremental amortization on intangible assets acquired from Questar Educational Systems. The Company's EBITDA outlook remains positive. We are maintaining our Buy rating on the Company's shares, trading at only 4.5 times projected fiscal 2007 EBITDA, well below the average of 16.3 times trailing-12-month EBITDA for 19 other publicly traded companies in the education industry.
Download Research Report
Revett Minerals Inc. TSX: RVM $1.04
Research Report
Industry: Metals & Mining
Rating: Speculative Buy (Initial)
Price Target: $2.75
By: Mike Niehuser
Revett Minerals Speculative Buy Rating In Initiating Coverage; Provides Both Value and Upside
May 3, 2007. An investment in Revett Minerals (TSX: RVM) provides both value and upside in the Troy copper-silver mine in the U.S. and also significant upside in a nearby world-class Rock Creek copper-silver deposit. The Troy Mine is profitable and increasing production, providing cash flow and operating experience valuable to develop the Rock Creek Project. Development of the Rock Creek Project is dependent upon the outcome of ongoing litigation brought by environmental groups challenging the 2003 Record of Decision necessary for development and construction of a mine at Rock Creek. We are of the opinion that the Record of Decision will be upheld to permit development of the Rock Creek Project, which should have a significant impact on the Company's stock price. Presently, the identified deposits at the Troy Mine and the Rock Creek Project may support a mine life of six and 20-plus years, respectively, though we believe this may prove conservative. We anticipate that there is good probability for improving operations of the Troy Mine and that development of the Rock Creek project will accelerate in the summer of 2007. We also anticipate continued above-average metal prices through the end of the decade. This may provide ample support for appreciation of the Company's stock for our investment horizon. We are initiating coverage of Revett Minerals with a 12-month target price of $2.75 per share and a Speculative Buy rating.
Download Research Report
SES Solar Inc. OTCBB: SESI $0.61
Research Note
Industry: Industrial & Manufacturing
Rating: Speculative Buy (Reiterated)
Price Target: $2.10
By: Sally H. Wallick, CFA
SES Solar Inc.: Update on Delayed 10-K.
May 6, 2007. SES Solar Inc. (OTCBB: SESI) researches, develops, produces and installs solar energy (photovoltaic or PV) products, including PV modules and roof tiles. We believe that the Company should be well positioned to benefit from growing demand for solar energy once it consolidates production in a new plant being constructed near Geneva, Switzerland. This facility is expected to be operational early in 2008. SES Solar was formed as a result of a September 27, 2006 reverse acquisition between SES Solar Inc., a Delaware company that had no operations, and Societe d'Energie Solaire S.A., a Swiss-based solar energy company. The audit of the Company's 2006 financial reports is the first complete review of its books since the acquisition. As a result, we believe that the audit is taking longer than usual as the Company's outside accountants complete a thorough analysis of its financial position. Although SES has not set forth a firm date when it expects to issue the 2006 10-K, we are hopeful that it will be filed within the next month. We believe that successful completion and startup of the new plant will be critical to SES's long-term success. Therefore, during 2007, the Company's profit and loss statement trends may be less relevant to investors who are evaluating the Company's progress than the completion of certain operational and strategic milestones related to this project. We rate the Company's shares Speculative Buy. Our rating is discussed in detail in a Dutton Associates report dated April 16, 2007.
Download Research Note
Shumate Industries, Inc. OTCBB: SHMT $1.85
Research Note
Industry: Oil, Gas & Energy
Rating: Strong Speculative Buy (Reiterated)
Price Target: $3.00
By: Richard R. Wolfe, CFA
Shumate First-Quarter Results
May 15, 2007. Shumate Industries (NASD: SHMT) reported first-quarter revenues of $2.4 million, in line with Dutton forecasted revenues, as revenue realizations at the Company's Hemiwedge Valve Corp subsidiary offset a slight decline in top-line results at the Shumate Machine Works subsidiary. The Machine Works' 24% gross margin for the most recent quarter compares favorably to profitability levels for the prior year, an indication that pricing power remains strong in that business segment. In the Company's valve business, we continue to expect positive developments during 2007 in terms of growth of cartridge valve sales, licensing of a subsea high-pressure valve, and completion of development of a downhole isolation valve. Our full report on the Company is forthcoming.
Download Research Note
21st Century Holding Co Nasdaq: TCHC $10.82
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $14.00
By: Richard W. West, CFA
21st Century Announces $5.0 Million Stock Repurchase; Confirms FY2007 Guidance
May 14, 2007. 21st Century Holding Company (NasdaqGM:TCHC) announced on May 14, 2007, that its Board of Directors approved a repurchase program of up to $5.0 million of its common stock. Management also confirmed its latest guidance of $2.00 to $2.50 per share for FY2007. We reiterate our Speculative Buy recommendation and our 12-month price target of $14.00 per share.
Download Research Note
21st Century Holding Co Nasdaq: TCHC $10.82
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $14.00
By: Richard W. West, CFA
21st Century Announces New President; Speculative Buy Rating Reiterated
May 8, 2007. 21st Century Holding Company (NasdaqGM:TCHC) announced on May 8, 2007, the appointment of Stephen C. Young as President. The appointment of Mr. Young is a move that appears to stem from the disappointing first-quarter results. We reiterate our Speculative Buy recommendation and our 12-month price target of $14.00 per share.
Download Research Note
21st Century Holding Co Nasdaq: TCHC $10.82
Research Note
Industry: Banks, Financial Services & Insurance
Rating: Speculative Buy (Reiterated)
Price Target: $14.00
By: Richard W. West, CFA
21st Century Reports First Quarter Results;Lower Net Income Affected by Lower Premium Rates;Guidance Reduced by Company;Reducing Rating to Speculative Buy and Price Target to $14.00
May 4, 2007. 21st Century's (NasdaqGM:TCHC) results for the first quarter ended March 31, 2007, shocked the investment community, as did the lower guidance of $2.00 to $2.50 for FY2007. Management was quite adamant that the political intervention by the state of Florida into the property market with dictated lower rates, while positive for individual home-owners, is creating chaos for property insurance companies. 21st Century is a sound company, but in view of the sharply lower than expected quarterly earnings and lower guidance of $2.00 to $2.50, we are lowering our rating to Speculative Buy and setting a new price target of $14.00 per share.
Download Research Note
Top Image Systems Ltd Nasdaq: TISA $3.12
Research Note
Industry: Software
Rating: Buy (Reiterated)
Price Target: $5.00
By: Rafael K. Kapelinski
Top Image (TISA): To Report 1Q 2007 on May 17, Preview
May 15, 2007. Top Image (Nasdaq: TISA) will report 1Q 2007 results on May 17. After releasing a revenue warning on May 1, the share price has been under pressure. Given the Company's 1Q 2007 sales guidance of around USD 4.15 million, we estimate that the Company will slip into an operating loss and generate 1Q 2007 EPS of around USD (0.07), which is very disappointing. According to the management, the revenue shortfall is primarily due to the weaker than expected performance of the Company's Japanese subsidiary. As we believe the Company's management has invested significant resources in rectifying the situation since. However, at this stage, it still unclear whether the Company's weakness in Japan was a function of the management resources' getting diverted from the operating business by the recent acquisition in the United Kingdom or of a general market slowdown. The bottom line is that we expect the share price to remain under pressure in the short term. Our rating and estimates are under revision.
Download Research Note
Vita Food Products, Inc. AMEX: VSF $1.68
Research Note
Industry: Food Manufacturing & Products
Rating: Neutral (Reiterated/Update)
By: Gerald F. LaKarnafeaux, CFA
Vita Foods Announces Poor 2006 Results, Hires CFO and Concludes An Equity Financing of $3.0 million.
May 7, 2007. Vita Food Products (AMEX: VSF) has announced an equity financing of $3.0 million, a new CFO, a new licence agreement and poor fourth quarter results.
Download Research Note
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
|