Bottom of the Barrel: The Portfolio Gets a Spring Cleaning
With a new season quickly approaching, it seems like a good time to do some spring-cleaning. Over the past week, I've dusted off the stocks in the Bottom of the Barrel portfolio and put most of them back, although some are now in different places.
As I conclude a week of rest and relaxation, here's a look at the newly polished Bottom of the Barrel portfolio.
The best performer in the portfolio has been
(WITS), the Georgia-based purveyor of customer service tracking systems. Its technology monitors the performance and efficiency of call centers that handle reservations, sales and inquiries for companies around the globe. This stock is up more than 60% since
Witness turned a profit in the fourth quarter and continues to expand its offerings both internationally and in midsize companies. I also like its conservative accounting practices, which are sometimes rare finds in aggressive small-caps.
|Barrel Spring Cleaning
A little tinkering is a good thing
|Original Rating||Current Outlook||Company/Ticker||Date of Mention||Mar 12 Close||Mention Price*||Price Last Week||% Change From Mention||% Change Weekly|
|2.5||Positive||Cost Plus World Markets (CPWM:Nasdaq)||March 6, 2002||$27.23||$25.83||$25.21||5.42%||8.01%|
|2.5||Positive||Rare Hospitality (RARE:Nasdaq)||Feb. 20, 2002||24.21||25.72||26.81||-5.87||-9.70|
|2||Positive||Endocare (ENDO:Nasdaq)||Jan. 23, 2002||15.39||18.21||15.60||-15.49||-1.35|
|2.5||Positive||SurModics (SRDX:Nasdaq)||Dec. 19, 2001||38.18||34.60||37.90||10.35||0.74|
|2.5||Positive||VitalWorks (VWKS:Nasdaq)||Nov. 21, 2001||4.97||4.30||4.93||15.58||0.81|
|2||Positive||FPIC Insurance (FPIC:Nasdaq)||Nov. 14, 2001||12.32||12.83||12.65||-3.98||-2.61|
|3||Positive||Witness Systems (WITS:Nasdaq)||Oct. 31, 2001||13.27||8.06||13.68||64.64||-3.00|
|3||Market||NetBank (NTBK:Nasdaq)||Feb. 6, 2002||15.84||13.45||14.83||17.77||6.81|
|2.5||Market||Coastal Bancorp (CBSA:Nasdaq)||Dec. 12, 2001||32.68||27.84||31.56||17.39||3.55|
|2.5||Market||Coinstar (CSTR:Nasdaq)||Nov. 7, 2001||32.28||19.96||27.26||61.72||18.42|
|2.5||Market||Hibbett Sports (HIBB:Nasdaq)**||Oct. 24, 2001||25.26||20.04||22.95||26.05||10.07|
|2.5||Market||Quixote (QUIX:Nasdaq)||Oct. 3, 2001||18.00||21.44||18.04||-16.04||-0.22|
|1||Special Sit.||Luby's (LUB:NYSE)||Feb. 27, 2002||6.74||6.22||6.37||8.36||5.81|
|3||Special Sit.||Quanta Systems (PWR:NYSE)||Jan. 9, 2002||16.41||16.05||15.66||2.24||4.79|
|Barricade||Avoid||Actrade (ACRT:NYSE)||Jan. 30, 2002||17.00||20.65||15.36||-17.68||10.68|
|0.5||Avoid||Goody's Family Clothing (GDYS:Nasdaq)||Nov. 28, 2001||5.40||4.50||4.22||20.00||27.96|
|1||Avoid||Bridgford Foods (BRID:Nasdaq)||Oct. 10, 2001||10.75||13.18||10.95||-18.44||-1.83|
|2.5||6.04||Empire District Electric (EDE:NYSE)||Jan. 16, 2002||21.01||21.23||20.68||-1.04||1.60|
|2.5||2.43||Met-Pro (MPR:NYSE)||Oct. 17, 2001||14.11||11.16||13.32||26.43||5.93|
|2.5||4.62||Integra Bancorp (IBNK:Nasdaq)||Jan. 2, 2002||19.81||20.75||20.23||-4.53||-2.08|
|3||4.49||Alexandria Real Estate (ARE:NYSE)||Feb.13, 2002||42.18||40.25||42.15||4.80||0.07|
|*Average price on date of mention.
**Prices Adjusted for 3:2 split on Feb 20, 2002.
Source: TSC Research
The other name to watch closely is SurModics (SRDX), a Minnesota-based maker of medical device coatings. SurModics' partnership with Johnson & Johnson (JNJ) to develop Rapamycin-coated stents for use in angioplasty continues to move forward. The new stent has a medicinal coating that helps prevent artery blockage. The product should be launched for general use in Europe in the second half of the year and in the U.S. potentially as early as next year. I also still like NetBank (NTBK) and the potential from its pending merger with Resource Mortgage. However, its 17%-plus gain since its
Names to AvoidThe names on the avoid list don't change. But given the continued turmoil at Actrade (ACRT), I'm changing this stock from its previous two-barrel rating to a warning rating, represented by the introduction of our flashing traffic barricade. The company's recent sudden change in strategy as well as concerns over its executive team make Actrade a very unappealing selection. (For an explanation of our barrel rating system,
Barrel PotpourriThe second-best performer in the Barrel portfolio, behind Witness Systems, is Coinstar (CSTR), the purveyor of that green coin-counting machine you see at the front of your local grocery store. While the convenience (and fun) of dumping your spare change into those bins and getting money in return are cool, the stock, which is trading at a price-to-earnings multiple of nearly 55 times, appears fully valued. The
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