Cheap Stocks

We focus on undervalued small-cap stocks. Usually with a large cash cushion. We have developed a valuation formula that has been highly successful, especially on small tech stocks. Since 2006, we have closed out 49 stock positions with an average gain of 37%. 9 stocks have been taken over.

Sunday, May 07, 2006

Update--May 7, 2006

Pretty boring week for our stocks here.

MIVA--(Buy price $3.80, Valuation $9.10) closed at $4.41 up a penny from last week. Up 16%. Still buyable here if you don't have any. BUY
DWCH--(Buy price $3.66, Valuation $9.31) closed up $.06 from last week at $3.83. Up 4%. Still buying at this level. BUY
INFT--(Buy price $4.11, Valuation $7.32) closed up $.15 from last week at $4.90. Up 19%. Buy a little here if you don't have any. BUY
ONXS--(Buy price $4.10, Valuation $7.12) closed up $.03 from last week at $4.57. Up 11%. Hold for word on investment banker activity and CDC buy-out offer. HOLD

OB-abies:
LINN.ob--(Buy price-$.36 ask, Valuation $.79) closed down $.06 from last week at $.42 ask. Up 17%. Linn announced earnings last week. Sales were down and they lost a little money, but they keep signing new customers, even though their mortgage activity business dropped off as expected. Expect improvement next quarter based on new customer announcements. HOLD
OPTO.ob--(Buy price $1.25, Valuation $3.09) closed even with last week at $1.43. Up 14%. Still have orders in to buy at $1.35--just having trouble filling them!
AVSO--(Buy price $1.19, Valuation $3.14) closed up $.11 from last week at $2.50. Up 110%. Announced a huge stock offering on Friday, $20 million of preferred stock. Deal is not closed of course but this is big. Looks like they are committed to growing. Only negative is that the preferred is convertible to common at $1.85. Not an unreasonable discount given the size of the offering. I plan of selling 1/2 my position at $2.50 or so and holding to see what happens with the rest. Sell 1/2, Hold the rest.
CTIG.ob--(Buy price $.27 ask, Valuation $1.10) closed down a penny to $.34. Up 26%. Very quiet. HOLD

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