>Retail with Forever 21

June 26, 2009

>our contacts tell us to watch for more big box department store turnover with possible new players coming in from overseas to take prime locations. These may be even groups of foreign retailers teaming up for big box space or could be current retailers like sears subbing out space .

June 25, 2009

>Our presenter recommends Fuqi International (FUQI) as a short. The stock has moved from $4 to $18 in two months on the government stimulus and hopes that this Chinese jewelry designer would succeed with its retail strategy. Channel checks suggest retail jewelry spending is very slow in the country and the company is facing a very intense competition in the space. Poor internal controls is another key negative.

June 17, 2009

>Emergency Medical Services (EMS) is one of the names recommended at our recent Dallas small cap forum. The presenter mentions the accelerating trend on the part of municipalities and hospitals to outsource ambulance and emergency room services in an effort to cut costs as a major catalyst behind the company’s recent success. The leader in both areas with strong national presence, EMS is poised for further growth. The presenter believes that the stock can move 30-50% in the next 12months.

June 15, 2009

>Our Dallas presenter highlights the market leading position of Littelfuse (LFUS), an Illinois-based manufacturer of circuit-protection devices. The company has moved its manufacturing facilities to Asia and Mexico and has been implementing a number of other cost reduction initiatives. Penetration of new markets and recovery in existing markets could lead earnings over the longer-term of $3.50+/share. Littelfuse has a solid balance sheet, with sufficient liquidity to pursue acquisitions.

June 4, 2009

>Speaking to Tatum today and May survey showed very strong improvements in trends leading us to the conclusion that the economy now has seen the worst and yet the “L” curve looks like it will be prolonged as credit availability still is tough.

June 3, 2009

>MedQuist (MEDQ) has recently been recommended at one of our small cap Boston idea forums. This leading provider of medical transcription technology and services has announced a successful resolution of long-standing SEC and DOJ investigations and has settled class action lawsuits. MEDQ has most of the major US hospital systems under contract and is well-positioned to benefit from proliferation of electronic health records and the need to adopt existing systems to the new standard. The stock is trading at a significant discount to free cash flow and can potentially more than double from the current level.

June 3, 2009

>Pimco in our meeting today talked about burden sharing and how as a policy it has caused uncertainty in the credit markets with the changed prioritization that the automotive bailout now has established. A new systematic risk that the government can come in and change debt holders prioritization retroactively they feel now changes the landscape for the municipal and corporate market for whenever the political winds blow. They now view systematic risk has taken on a whole new meaning. They are very worried as to California’s pending issues and more corporate debt that still may face challenging future repayment problems.