It's been just about seven years since the peak of the Nasdaq, and I'm sure we all have our horror stories of the two to three years that followed.

In February 2000, I was at a meeting of CMGI portfolio companies at the Shutters on the Beach Hotel in Santa Monica, Calif. CEO and billionaire (at the time) David Wetherell gave a talk in which he announced that CMGI, at $185 a share, was the "top-performing stock of the prior decade," and everyone there began to cheer. The next day, CMGI invested $5 million in a company I had started called Vaultus (which, fortunately, still exists).

I had the dubious honor a month or so later of speaking at a CMGI analyst meeting about CMGI's prospects in wireless, which is the same space Vaultus focused on. The woman in charge of investor relations at CMGI was so happy with my talk that she gave me a hug immediately afterward. The rest is history: CMGI, like many other companies, went from $180 to below $1.

On Stockpickr, we have a portfolio called " Whatever Happened To," which is made up of former highfliers that came crashing down. Wall Street shuns these companies, afraid to get burned again.

But seven years is a long time, and many of these companies have completely new management and even new business models. These names are now worth a look because they can soar from where they are now.

CMGI, actually, is interesting right here. At one time, it was an "Internet incubator," funding startup companies that it would, in some cases, sell for billions. Lycos and Geocities were among the companies it invested in successfully. Another company it invested in (actually, the same day it invested in Vaultus) was Half.com, which got sold to eBay ( EBAY) shortly thereafter for hundreds of millions.

But most of CMGI's investments fell flat, and eventually CMGI evolved into an information technology services company. Its revenue and earnings have become steady, and the CMGI balance sheet is now pristine. The company had $47 million in operating cash flow last year and has almost $200 million in net cash in the bank. With an enterprise value of just $421 million, CMGI trades for just nine times cash flow, putting it in buyout territory. And I'm not the only one who thinks so.

Perhaps the best hedge fund in the world, Renaissance Technologies, owns shares of CMGI. I believe Renaissance is pursuing a strategy of buying companies with enormous amounts of cash that are profitable. The idea is that these companies will have a hard time going out of business, and will eventually find a business model to drive their shares up. Check out Renaissance's top holdings.


CMGI (CMGI)


Another company that's interesting is InfoSpace ( INSP - Get Report), which hit a high of $400 in 2000 and is now sitting around $20. InfoSpace is in the mobile media space -- selling ring tones, etc. -- as well as the search engine space. The company has $400 million in cash in the bank, no debt and trades at just seven times cash flows.

With the loss of a major customer in the mobile space, the company has decided to get out of the mobile business. Meanwhile, InfoSpace's search business is declining. That said, the company will still remain cash flow positive, and the search business is not disappearing. Given the balance sheet, as well as the funds invested in the stock, I believe the worst is baked into this name.

Hedge fund manager Seth Klarman is currently invested in InfoSpace. Klarman is known for writing the book Margin of Safety, which is out of print but sells for more than $600 on eBay. Check out for Klarman's holdings. The Jacob Internet Fund, with a five-year annualized return of 25%, is also invested in the stock. In a recent interview with The Financial Times, Ryan Jacob stated that he likes to have both value and growth plays in his Internet fund. InfoSpace looks like a little bit of both, assuming it can eventually turn around its search business.

I love companies that could make a comeback, and I believe all the ones on the " Whatever Happened To list I've compiled are candidates for such a comeback.

Stockpickr tip of the day: It's interesting to look at the recommendations displayed for various portfolios. For instance, take a look at this portfolio: Motorola , Microsoft ( MSFT - Get Report), Sirius Satellite Radio ( SIRI - Get Report), streetTracks Gold Shares ( GLD - Get Report) and NorthStar Realty Finance ( NRF).

Sirius is an interesting holding because it could suggest that a lot of the funds that own stocks like CMGI, InfoSpace, etc., are also betting on other speculative tech companies that could make comebacks. I had never even heard of NorthStar before, but it looks like an interesting diversification play when compared to the companies on the "Whatever Happened To" list.

The company has a steady chart and is on two lists that aren't normally speculative lists: Investor's Business Daily's top 10 dividend payers and the 9% Yield Club.

Recommendations are determined, roughly, by looking at a particular portfolio and then examining the 30,000 other portfolios in the Stockpickr system. We determine the portfolios that are most correlated to the portfolio we are looking at, and then find three stocks that are "most loved" by portfolios highly correlated with that portfolio, as well as two stocks that are a bit more speculative than are found in the most-correlated portfolios.

This results in five total recommendations. You can choose to get recommendations from all the portfolios in the system, just the professional portfolios, or just the do-it-yourself portfolios.

At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.

James Altucher is a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He is also the author of Trade Like a Hedge Fund and Trade Like Warren Buffett. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback; click here to send him an email.

TheStreet.com has a revenue-sharing relationship with Trader's Library under which it receives a portion of the revenue from purchases by customers directed there from TheStreet.com.