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capperjohn1
07-12-2005, 04:14 PM
Does anyone subscribe to any of these? Their ads sound great, but I wonder what the comparison is to the sports services on here. Hype? Pump and dump? I asked awhile ago and can't remember if there were any responses. If nothing on the Motley Fool, any reco's for a novice, start-up investor?Thanks all!!

moondog22
07-12-2005, 04:27 PM
I used to subscribe to their free on-line edition.Its not bad,Motley Fool

moondog22
07-12-2005, 04:33 PM
Most newsletters are all hype.2 good ones are Zack.com and Penny Stock Fortunes

capperjohn1
07-12-2005, 04:34 PM
Thanks Moon..doesn't Motley have a subscription service newsletter after the free 3o day 1 time newsletter is up?

moondog22
07-12-2005, 04:37 PM
Thanks Moon..doesn't Motley have a subscription service newsletter after the free 3o day 1 time newsletter is up?
Yes,special discount

capperjohn1
07-12-2005, 04:50 PM
As a newbie though, it's tough to justify paying hundreds of dollars for the Fool's newsletter. And I think there is a few of them. Anyone think they're worth it? Or does anyone subscribe and want to share the info? Again, thanks all!!

moondog22
07-12-2005, 04:59 PM
As a newbie for starts, subscribe to The Wall Street Journal, Barrons, Daily Investor.Use BigCharts.com also for help in researching.

rented mule
08-06-2005, 07:24 PM
I only subscribe to one. It's called Swingtradercentral. He gives out one pick a day. He does it all through technical analysis. He's very good, but streaky. But when he's going good, he's really good.

moondog22
08-06-2005, 08:20 PM
I only subscribe to one. It's called Swingtradercentral. He gives out one pick a day. He does it all through technical analysis. He's very good, but streaky. But when he's going good, he's really good.How often do you trade using Swing?

rented mule
08-06-2005, 08:37 PM
How often do you trade using Swing?

I would say he averages 4 trades per week and the average hold is anywhere from 1-3 weeks.

I make a lot of trades based on my own work and I've averaged about 75 trades per month, this year.

loc33
08-20-2005, 02:32 PM
I have subscribed to Hidden Gems since it started a couple of years ago. I like it a lot. I have a finance MBA, but don't have time to do the in depth research I would like on stocks so I decided to rely on Hidden Gems because they have a similar philosophy to when it comes to investing as a strong factor for selecting stocks is a companies free cash flow.

They recommend two small cap stocks each month. These are stocks that are generally not followed by analysts, are somewhat risky, but have a lot of upside. They also have a watch list and recommend 2 tiny gems each month, which have a very small market CAP.

I have bought some 25-30 positions with a return between 35%-40%. There have been some big gainers that have cancelled out the dogs.

2 of the best were the first two I bought, which were in the issue right before they started calling it Hidden Gems

Overstock.com (ostk) up 200%
Valero (VLO) up 370%

Others that have done well are
(Parl) up 290% (This is the company Paris Hilton sells her fragrances under)

Those are where the majority of the 35%-40% have come from.

The dogs have been
CDIC, Red Envelope (rede), (Deck)

(CRYP) Cryptologic Inc has stumbled lately but they are standing by this pick as they are a company that puts in the encryption to make online poker sites secure. They lost a customer which has caused a bit of an over reaction in the market.

They also provide good , informative articles each month. I have enjoyed it thus far.

Let me know if there are any questions

capperjohn1
08-20-2005, 02:35 PM
Can you cut and paste articles or picks? Thanks for the responses!!!

loc33
08-20-2005, 03:10 PM
Vol. 3, Iss. 8, August 2005The #1 Place for Small-Cap Investorswww.hiddengems.fool.com
Flamel Technologies
Hidden Gem by Tom Gardner

Risk-Level Rating: High

New management has the trust of outside and institutional investors.

It's the exciting technology leader in novel drug delivery methods.

A strong balance sheet should improve with likely new partnerships.

Nasdaq: FLML
33 Avenue Du Dr. Georges Levy
Venissieux, France 69693
Ph: 33-4-7278-3434
www.flamel.com
(Except price, amounts in millions)
Recent share price:$19.02
Market Cap:$413.7
Cash/Debt:$105.3/$2.3
Owner Earnings Run Rate:$12.5

Buy-Around Price: $19.30In June 2004, I made my most speculative selection yet in Hidden Gems. I recommended Flamel Technologies (Nasdaq: FLML), a drug delivery company based in Lyon, France, that boasted a sterling balance sheet and a very promising use of nanoparticulate technology. The company was then valued at $500 million, with its stock trading around $25. An emerging partnership with Bristol-Myers Squibb (NYSE: BMY) held out promise for nearly $150 million in royalty payments over the next five years, as the two companies prepared to deliver Basulin, a long-acting human insulin for diabetics. I encouraged members to buy Flamel up to $27 per share and to plan on holding for many, many years.

When the Basulin partnership broke down, it was clear that I'd made a mistake. Management was relying on too few partners; its deal structures weren't creating long-term bonds; it was doing an increasingly poor job of running a transparent business for potential customers and shareholders; and operations could be expected to continue delivering losses for the foreseeable future. CEO Gerard Soula, who had cashed out nearly $10 million in stock at around $31 per share, received another large batch of stock options, priced for him below $2 per share (cough, cough). Soula had promised three new partnerships, but they weren't materializing. The valuable technology that he'd developed was being squandered. It seemed that Flamel might, in years to come, simply burn through the $100 million in its bank account. The stock had been sliced in half, to $13 per share, and I considered selling.

But I'm always slow to the trigger on selling stocks, so I scoured the marketplace for clues of a turnaround and found none. Then two institutional investors OSS Capital and BVF began to disclose substantial share purchases and their intent to challenge the CEO's proposed slate of directors. A feud erupted in the filings, with OSS Capital's Oscar Schafer connecting on one intellectual uppercut after another at founder Soula. We encouraged all members to vote with the rebel outside shareholders against the incumbent's board.

A week later, the results were tallied at Flamel's shareholder meeting. A full 88% of the company's shares were voted in favor of a new board. Soula resigned immediately, selling his more than 1 million shares. And Schafer's board of directors took control of the business. They quickly elevated Stephen Willard from his position as general counsel and CFO into a permanent role as CEO (veteran members of this service will recall that Transkaryotic Therapies (Nasdaq: TKTX) boosted its former general counsel to the CEO slot, and the stock rose nearly 10 times in value). Weeks later, Willard did something his predecessor had sidestepped for a year. He sat down for an interview with us in Hidden Gems (excerpt on page 10; full transcript on the website).

The Business
Flamel's business plan is the same as it was in 2004. The company helps major pharmaceutical companies and drug developers deliver their drugs into the human body more efficiently, effectively, and safely by means of nanoparticulate technology. In addition to licensing its technologies outright, Flamel conducts research and development for these drug makers.

Flamel has two delivery technologies. The first, Micropump, is a formulation of active ingredients that act as tiny time pills in the small intestines. A recent deal with TAP Pharmaceutical Products will enable patients with heartburn and acid reflux to take a Micropump formulation of Prevacid that is then distributed at intervals throughout the day. Flamel's second technology is the Medusa, used for the injection of proteins and peptides that mimics the natural release of proteins in the body. Medusa competes in a $50 billion market, expanding rapidly as researchers make headway on mapping the complex functions of proteins. The failed Basulin agreement with Bristol-Myers was structured around the Medusa technology, but it's a technology about which CEO Willard remains very optimistic.

The good news about Flamel's business approach is that major medical trends are working in its favor; the company has plenty of cash with which to steadily build a successful business; and Willard strikes me as a committed, methodical, and driven leader with something to prove to Flamel's patient owners.

The bad news? It still relies on too few partners. The company will not blossom into a multibillion-dollar business without a widening number of long-term partners. In his conference call 24 hours after assuming the top post, Willard said what I wanted to hear: "I need to spend more time with the team, but I'm confident that our goal will be to get a lot of good deals done as promptly as we can."

The Financials
In its most recent quarter, Flamel burned through $7.6 million from operations, coinciding with significant investments in research and development. The company received $5 million in Basulin break fees from Bristol-Myers, and ended the quarter with more than $100 million in net cash. Rarely can balance sheet capital be so simply labeled "shareholder money." The cash reserves come from the sale of stock to outside investors. Since coming public in 1996, Flamel has consistently generated operating losses. Obviously, the company 15 years after its founding now must demonstrate an ability to methodically generate cash.

The Valuation
Valuing a business that floats into and out of profitability without a functioning model for steadily recurring revenues is well-nigh impossible. Instead, a decision to invest in Flamel is a bet on three strengths of the business.

The first is the powerful technology. The second is the balance sheet loaded down with more than $100 million in cash. And the third is the new leadership group on the board and in the CEO seat. Of the three, I'd like to concentrate on the last in making my case for buying more shares.

Willard demonstrates everything I look for in a world-class leader. I finished my interview with him feeling the same enthusiasm for and confidence in leadership that I did after talking to Selim Bassoul at Middleby (Nasdaq: MIDD) and Michael Astrue at Transkaryotic. Willard is focused on the areas of greatest opportunity, committed to eliminating needless expenses, and, as far as I can tell, completely lacking the arrogance that leads to so much executive underperformance. In his first conference call, he repeatedly emphasized the importance of his team. Later, when an analyst compared him to Abe Lincoln, he graciously noted that he's shorter, has no beard, and never wants to get shot. Match that with great technology and a pristine balance sheet and I believe Flamel could more than triple in value over the next five years.

The Risks
The company has a new leadership team, has failed to sustain key partnerships, and, after more than a decade of operations, isn't yet steadily generating profit. For these reasons, I do not recommend overweighting in this stock. That said, each risk is surmountable by teamwork, technology, capital, and ambition.

Conclusion
It need not be a large position, but I believe Flamel Technologies under its new leadership team earns a position in the portfolio of every Hidden Gems member.

BettorsChat
08-21-2005, 01:07 AM
loc,

Is that the only stock they've recommended this month?

Personally I don't like that stock, because they haven't made any money in 15 years.

tash
08-21-2005, 02:47 AM
b.c..............thanks for the heads up!

loc33
08-23-2005, 02:14 PM
EPIQ Systems <br />
Hidden Gem by Bill Mann <br />
<br />
Risk-Level Rating: Medium <br />
<br />
A classic &quot;boring business,&quot; the company specializes in bankruptcy and class action case management. <br />
<br />
Inside ownership is...

loc33
08-23-2005, 02:18 PM
These are updates from previous recommendations. I don't own FormFactor as they are a supplier that I manage and I personally don't like the way they do business.

Tragically, outside shareholders lost yesterday when the Shire-Transkaryotic merger barely passed, backed by just 52.6% of the vote. Absent the votes of two board members representing the limited interests of Warburg Pincus, this would continue as a live recommendation. Instead, prepare to receive $37 per share in cash. The position is now fully closed out on the scorecard.

***
Stanley Furniture (Nasdaq: STLY) went a long way with its earnings report to prove it has turned the corner on the inventory problems that have been dogging the furniture sector all year and most recently hounding Hooker Furniture (Nasdaq: HOFT). Stanley reported fantastic earnings for the second quarter, with sales growing 16% and profits growing just a notch slower at 10% for the quarter and 14% year to date. Free cash flow production doubled year over year. All in all, it was a great earnings report that the market did not expect.

***
QLT (Nasdaq: QLTI) announced on July 14 that Visudyne sales in the second quarter totaled $129 million, up slightly from the $124 million in the first quarter. While it is encouraging that modest growth continues, you should be very cautious about the drug's long-term future given mounting competitive pressures.

A week earlier, QLT's acne drug Aczone was approved by the Food and Drug Administration. That normally would be great news, but this drug is now in limbo. Two days prior to its approval, Aczone was dropped by former partner Astellas over concerns that the drug's restrictive label would make it difficult to market.

QLT is conducting its own market research with leading dermatologists to determine if that is indeed the case. If it is, that's a big blow to the company, because it won't promote the product until it completes the clinical studies necessary to get a more favorable label. That means the company may not generate sales from Aczone for two years.

***
Deckers Outdoor (Nasdaq: DECK) reported per-share quarterly earnings of $0.21, a nickel per share better than analyst expectations. Keep in mind that those expectations had been previously lowered twice during the quarter. Sales came in at $40.3 million, down a hair year over year, and management boosted the low end of its full-year earnings-per-share target by $0.03 and reaffirmed its sales estimate, so all in all it was a positive release.

Inventory growth surged by 240%, which doesn't make us happy, particularly since Deckers' products are sensitive to fashion trends. If this inventory is discounted, it will ultimately hurt margins.

Chairman Doug Otto called the past six months a "wake-up call." That's a good start, but it doesn't eliminate the uncertainty facing this company. New CEO Angel Martinez has a big job ahead of him as he repositions Teva as a performance, not a sandal, brand a task that will take a few years. New product lines aren't expected to take off until 2006 and 2007, so this won't be a quick turnaround.

Because the earnings report signaled a slowdown in the bloodletting at Deckers, the market reacted positively. With the stock now significantly cheaper than it was, I think the spring's misfires have been fully priced in, and I expect good performance ahead.

***
FormFactor (Nasdaq: FORM), the leading manufacturer of advanced test probe cards, reported that year-over-year profits dropped 26% to $5 million this quarter. While revenues ($52.3 million) and bookings ($58 million, a 14% increase) both hit record highs, the company is not operating nearly as efficiently as we would like to see. There's also been a management change, with the resignation of COO Jens Meyerhoff, whose responsibilities will now be performed by CEO Igor Khandros and President Joseph Bronson.

On its conference call, management said that, despite its new manufacturing facility, FormFactor is still constrained by capacity and is undergoing a "debugging" process of new equipment. Its new facility, though still on target, is producing at only about 15% of its capacity. That means it is still relying on its old factory, which had significant problems last year that knocked the stock down, to produce the bulk of its product. As a result, it can't take on new projects to meet future customer demand.

While the earnings news was not good, we think the company is still poised to reap the benefits of the coming shift to smaller chips, which will translate into greater demand for probe cards. FormFactor's market is not drying up, its customers are not going away, and though the transition to the new facility has been more difficult than expected, we think the company is in solid shape.

***
New York & Co. (NYSE: NWY) announced that it has acquired Boston-based Jasmine. Jasmine's founders, who have been running the company for the past 35 years, will be coming along as part of the deal.

loc33
08-23-2005, 02:20 PM
I personally like the tiny gems. I don't think they make these formal recommendations anymore because they were surprised at how their picks effect the market when released on stocks that are such...

loc33
08-23-2005, 02:22 PM
Investing Lesson: Building a Superstar Small-Cap PortfolioSmall caps as a group have been on a tear over the past two years, with the Russell 2000 up 19% per year over the past 24 months. We've outperformed the Russell 2000 since inception, and we hope you're enjoying the positive results. You may be wondering, though, whether to take some money off the table now, given the stellar general performance of small companies.

The answer to questions like this will always depend on a variety of factors, including your age, risk tolerance, investing time horizon, near-term spending needs, and emotional temperament. There's no one-size-fits-all answer to the question of what percentage of your money you should have in stocks generally, or small caps specifically. That said, if you want to be comfortable with what you own, here are a few tips.

Don't Chase Past Performance
One thing you don't want to do is to look at what's been happening in the very recent past and extrapolate that into the distant future. It's particularly true if doing so has you heavily overweighting toward what's been hot! That's a bad idea, whether we're talking about any of our individual recommendations or the overall performance of small-cap stocks.

The temptation to buy what is on fire simply because it is en fuego is unwise. That thinking got a lot of investors in trouble at the turn of the century. For evidence, you need only look at the 1997 to 2000 rise of Lucent Technologies (NYSE: LU) from $15 to $100 per share. Today, the stock trades below $3.

Resist the temptation to blindly chase individual stocks higher; instead, pay close attention to my buy-around prices, which are tied to the present performance of the business and its prospects. Sometimes we will buy more of a stock that's doubled (Middleby at $47). Other times we won't (Marine Products at $21). Sometimes we'll sell a loser (Pegasystems at $7). Other times we'll buy more (Flamel today).

The core factors are a company's operational performance and the price tag on the business. Don't blindly buy because a stock has risen. And don't feel like you need to heavily weight your portfolio with small caps simply because they've been on a tear.

Build a Properly Diversified Portfolio
There's a lively debate about diversification in our Hidden Gems community and beyond. On the one hand, you've got the extreme position advocated by Philip Fisher and Hidden Gems interviewee David Nierenberg. They believe you need no more than five or six stocks in your portfolio. But these master investors operate at levels of expertise beyond that of most members. This is and has been their full-time job for many years.

Unless you've been investing successfully for 15 years, my advice continues to be that you lean toward being diversified into 30 to 40 small caps. If that sounds extreme, remember the examples of Shelby Davis, Peter Lynch, and Joel Tillinghast, who held more than 1,000 companies and absolutely smashed the market's average return.

Shelby Davis continues to stand as one of my investing heroes. His approach entailed buying and virtually never selling. He built a portfolio of more than 1,000 stocks in his personal portfolio and earned annualized returns of more than 23% for decades, turning $50,000 into nearly $900 million. For Shelby Davis, the time to buy stocks was when you had the cash; the time to sell them was when you needed the cash. Otherwise, you just held, letting your big winners erase the effects of your losers.

Today in Hidden Gems, we're at approximately 35 companies, a number that can protect you from violent price volatility on a day-to-day or week-to-week basis. That's a primary reason for diversification: to take emotion out of the sport of investing. In my opinion, you aren't sufficiently diversified if you ever get emotional about your investments. And I mean ever ... in good markets and bad, after good earnings reports and bad.

We'll continue to increase the number of companies recommended here, bringing you more superior investment ideas and encouraging you to diversify your way out of the realm of emotional investing. Forty years from now, you should expect to see an even balder advisor on the masthead, overseeing more than 250 small-cap recommendations, aided by a staff of experts. Remember that the promise we make is to keep track of your Hidden Gems investments until we close out the positions.

Always Add New Money
Finally, this newsletter imposes a discipline upon me as your advisor. Every fourth Thursday, my guest analyst and I are tasked with providing you a pair of formal recommendations, a Watch List, and some Tiny Gems. Some of those recommendations will be repeats, just as this month's is. Most will be new.

With this approach, we are attempting to impose a discipline upon you, too. We want to motivate you to live the life of a net saver. If we can inspire you to set aside regular amounts of money each month for the thrill of investing it in something small and promising, we can move to eliminate money as a limiting factor in the adventure of your life.

loc33
08-30-2005, 11:07 AM
Blue Nile
Hidden Gem by Tom Gardner

Risk-Level Rating: Medium

Pristine balance sheet and growing earnings.

Loyal customer base with repeat purchasing growing twice as fast as the rest of the business.

Prototypical use of Internet platform to sell established and desired product without the high cost of retail store operations.

Nasdaq: NILE
705 Fifth Ave. S., Ste. 900
Seattle, WA 98104
Ph: 206-336-6700
www.bluenile.com
(Except price, amounts in millions)
Recent Share Price: $31.45
Market Cap: $550
Cash/Debt: $81.3/0
Owner Earnings Run Rate:$13.5

Buy-Around Price: $32.00


Otter Tail Corp.Hidden Gem by Bill Mann

Risk-Level Rating: Very Low

Matches a core cash-generating business with a strategy of acquiring undervalued companies.

Has generated market-beating gains despite low growth at its utility subsidiary.

There's promise in its wind tower construction and waterfront equipment businesses.

Nasdaq: OTTR
215 S. Cascade St., Box 496
Fergus Falls, MN 56538-0496
Ph: 866-410-8780
www.ottertail.com
(Except price, amounts in millions)
Recent Share Price: $28.01
Market Cap: $816.1
Cash/Debt: $16.1/$259.6
Owner Earnings Run Rate: $54.7

Buy-Around Price: $29.25