Set your calendars - Stockgroup Information Systems (OTCBB: SWEB) will be releasing their Q4 and year-end numbers on March 15th, at 3:00 PM EST. A conference call and webcast will begin at 4:05 PM EST. To participate in the call, you can go to the company’s website (http://www.stockgroup.com/) to register for the call.

Just as a reminder, we were ballparking about $8 million in sales for the year. We’re not necessarily looking for earnings in 2006, but we know exactly why - some major expansion expenses that are likely to mean so much more down the road. Also keep in mind these Q4 numbers won’t reflect the recent wireless media acquisition, as that actually happened in fiscal 2007.

However, you don’t have to guess if you’re on the call. We recommend you listen in to get the whole story. 

As of 8:54 AM EST….. 

Does the tail wag the dog, or does the dog wag the tail? 

For what it’s worth, most of the Pacific Rim indices closed between 2% and 3% lower for their Wednesday session. And, the exchanges currently open (mostly in Europe) are also down relatively firmly - say around one percentage point on average - in their first day back from Tuesday’s carnage. The only exception was Chinese stocks, bouncing back slightly after a 9% freefall yesterday.

If U.S. stocks did indeed follow that lead on Tuesday, it doesn’t necessarily point to a great day today. However, I don’t buy into the “we do what they do” mentality. In fact, our futures (U.S.) are higher. The correlation is only highlighted when there is one, and when we need a reason to justify a particular market trend. A closer look reveals there’s not actually a big cause/effect relationship. Meaning, while I’m worried about losses in the U.S., I don’t think Asian stocks are the lone culprit.

Like we said in today’s newsletter edition, stay disciplined and focused. In my observation, things typically turn when they seem like they’re not going to at all. Maybe that’s today, or maybe not (based on foreign equity influence). But, don’t assume the U.S. market will mirror those overseas results.

We just wanted to let you know we’re absolutely planning on publishing tomorrow, obviously in regards to today’s huge selloff. We just want to back away from the table for a few hours and make sure we’re thinking rationally rather than emotionally.

In the meantime, don’t panic - stay smart, and focused….easier said than done, I know. We can’t undo today, but we can be ready for whatever tomorrow may bring. Look for our e-mail early Wednesday morning. 

Moving right on down the punchlist to greatness, Clearly Canadian (OTCBB: CCBEF) today announced a distributor for its Glengrove brand of organic foods. The company is Tree of Life, Inc. - one of Canada’s leading distributors in the organic food segment. There’s an added upside to the new relationship…Tree of Life is specifically targeting mass retailers.

Hmmm, why does that seem familiar? Oh yeah, it’s the ‘think big’ theme we’ve seen Clearly Canadian use as their m.o. since the beginning of the year, when the reinvented company started to practically take over the world (figuratively speaking, of course).

Do we even need to say it? Ok - we will. Over the past few weeks, this company has made us a believer. We have no reason to think they won’t penetrate their new and old target markets at least as much as they’re hoping. Given enough time, we can see this corporation taking its stock through the roof….they’re certainly firing on all cylinders right now.

For more on the Glengrove distribution deal, click here. 

One of the toughest parts about writing a newsletter is assuming your readers know exactly why you think, feel, or say something. Fact is, that’s not always the case. Fortunately we have a pretty active and vocal community out there, so when we use a tool without explaining it, you guys ask good questions.

Here’s one of the more recent reminders that I think every single user/reader should think about, as we tend to talk a lot about Fibonacci lines:

Could you explain………….one more time (I’m sure), exactly how you select the two extremes of a stock movement (high and low points) in order to calculate the possible retracement points etc.? Sometimes it is difficult for me to decide on which support and or resistance points to use for the calculation. Is there a preferred time span to work with in selecting the points, or is it a certain number of attempts at support or resistance that validates the high and low points you select for your calculations? Thank you for your help.

Thanks for the question - it’s definitely one worth a closer look.

To answer the question, there is no ‘exactly right’ answer. We don’t think any random price level is as good as any other, but there are often more than one justifiable baselines to start with. Even then, don’t be fooled; while there’s actually quite a bit of statistical science behind it, this is still just a means of making an educated guess. On the other hand, these ‘guesses’ seem to work in our favor far more often than not.

In general, here’s what we’ve found to be important considerations when looking at Fibonacci retracement levels….

• Look for levels that have been horizontal support or resistance in the past. If a stock has the same low (or very near the same low) for six of the previous nine sessions, then it’s likely to be an important line to watch for Fib retracement purposes.
• If a low or high is made that’s ‘pointed’ - meaning a sharp peak or plunge made by just one single bar - that may also be an important level for Fibonnacci purposes.
• A bar that includes a major volume surge that kick-started a bigger trend is also possibly an important level to use when looking for retracements.

Even then, it’s still more an art than a science. We’d say practice more than anything will help you spot the key levels to watch for when using this particular tool.

One thing to watch out for….don’t try and apply Fibonacci lines to all charts. Sometimes, the patterns just aren’t visible, if there are any at all. Trying to ’squeeze’ a Fib line onto a chart is likely to make matters even more confusing.

Hope this helps. By the way, if you’re looking for recent examples of where we’ve looked at Fibonacci lines, take a look at the following………..

Commerce Planet - 2/23/07

Clearly Canadian - 02/13/07

Web2 Corp. - 02/03/07

Looks like the acquisition of IMAR is turning out to be a good one for Challenger Powerboats (OTCBB: CPWB), as it included the Gekko brand name. Why? One of the Gekko boats - the GTR 22 to be precise - has been approved for tournament use by the overseers of water skiing competitions as well as by the folks who administer ‘barefooting’ tournaments.

Not this is a cure for cancer or the end to world hunger, but this is actually a pretty big deal. See, there were only two boats approved for use by both sports (barefooting and water skiing). Though we’re not sure how much crossover there is in this particular slice of athletic competition, we have to think that kind of flexibility makes the GTR 22 more attractive to the people who may participate in both. 

For more, click here.

We received this comment via e-mail about Titan Global’s (OTCBB: TTGL) business model, but figured it was something worth sharing with everyone to get some discussions started. Do you agree, or disagree? What do you think about Titan’s future in this niche? Find the ‘Leave a Comment’ section below to chime in. Don’t worry, your name and e-mail address are never publicly posted.

Anyway, here are Neal’s thoughts…..

I can’t imagine why prepaid wireless is so big. Well, OK, maybe I can. Perhaps people have a cell phone, but don’t want to pay a monthly fee for something they use infrequently. Prepaid fits perfectly. Perhaps they don’t want to be tied down with a multi-year contract, as most wireless companies require. Again, prepaid fits perfectly. There may be a lot more people like this than the ‘traditional’ wireless telephony industry realizes. The biggest advantage, for business, is that they receive payment sometimes well in advance of actually providing the service or goods. A company that can’t make money on a deal like that shouldn’t be in business.

What say you?

Looks like ‘bricks and mortar’ has switched to ‘clicks and mortar’ for Web2 Corporation’s (OTCBB: WBTO) Chamber of E-Commerce. Already expanding the customer base of its easy-website-building offer, Web2 announced they’re now going to try and get local Chambers of Commerce in the United States to help support the proliferation of the service. By giving local Chambers free use of the site-building tool (and free hosting) for their own sites, the company hopes to showcase what they can do through one of the most legitimate organizations in any community.

We like the idea - a lot. Though we don’t have any specifics on the number of Chambers there are across the nation, we know it’s in the thousands. And, each of those Chambers is closely involved with potentially hundreds - if not more -of local businesses also looking to gain credibility. We just see this tactic creating massive interest in Web2’s E-Commerce solution.

And from the looks of the stock’s chart over the last couple of days, we don’t appear to be the only ones thinking like that. We mentioned on Friday WBTO looked like it was finding support at $1.42, and later in the day, it rallied sharply up to a close of 1.71. Today we’re seeing great follow-through, and it looks like the buying volume is going to be even stronger today. We think this may well be ’round 2′ of the any bigger picture uptrend; the last surge from early December started out a lot like this one….out of nowhere. Once the 20 day average line was crossed though, this thing didn’t look back until it had more than doubled. We’re not saying we’re due for the same again, but we are saying we like what we see so far.

The other thing…..earnings are probably due soon. Could this be an early warning that revenue is finally starting to flow in? We’ll see.

This is the kind of stuff we’re talking about when we say Stockgroup Information Systems (OTCBB: SWEB) looks like they’re doing the right corporate-level things to make their stock an attractive investment. Today they announced they ranked as the top Canadian site in terms of pages-viewed-per-visitor. And just for some perspective, that’s not number one among Canadian financial websites….that’s among all Canadian websites. 

The implication is quality of traffic, and depth of use. The site’s not just randomly catching casual passers-by. Instead, StockHouse.ca (or StockHouse.com for the U.S.) is attracting a crowd and keeping them involved. THIS IS THE KIND OF TRAFFIC ADVERTISERS LOOK FOR. With all those same eyeballs viewing page after page, eventually, one of those banner ads or links is likely to create a click….much more so than a casual glance at a random news page would.

More clicks means more advertisers, and more collected ad placement fees. Eventually, we suspect shareholders will be the beneficiaries of Stockgroup’s impressive results.

And if you want more proof that StockHouse is indeed a higher quality site in terms of user interest (i.e. length of time the site is browsed per visit), chew on this….the average StockHouse user spends five times as much time on StockHouse.ca as they do on competing sites Yahoo! Canada Finance and Sympatico-MSN Finance. These same users view 50% more pages than they do on competing sites.

Again, it goes back to quality. The more engaged the users are, the more StockHouse can charge in advertising fees. 

For more on the announcement, click here.

I think I’m getting deja vu here….this is the third time today I’ve made mention of the 20 day moving average line in regards to one of our profiled companies. On the other hand, I’m not surprised about it; under the same overall market scenario, a lot of stocks tend to behave in similar ways.

After reading that, you probably won’t be surprised to read BioCurex (OTCBB: BOCX) shares are finding some nice support at their 20 day line…the kind of smooth, consistent support we like to see.

On February 13th, sailing was anything but smooth. The stock raced from 63 cents a couple of days earlier - on news of a possible cancer screening test - to a high of 77 cents on the 13th. That’s a 22% rally, and while I love gains, those ‘flash’ rallies can really throw a wrench in the works. The rapid run-ups can invite big profit-taking, effectively making a chart difficult to read. The good news is, once the dust settles, we can go on about our business.

In BOCX’s case, now that the volatility is mostly washed away, we can see support being made at a rising 20 day average line. It’s not all-out conclusive evidence of huge gains from here. However, I do think a solid foundation is being laid here. A couple more days of gains could really cement the upward momentum.

On February 3rd, we mentioned how we thought Web2 Corporation (OTCBB: WBTO) shares might be prepping for a nice recovery move. Ultimately the stock misfired, running up into resistance at the 20 day moving average line, then falling back again. We kept it on our radar though, and perhaps it’s a good thing we did…the stock looks like it’s taking another swing.

Now, mindful of what we saw less than three weeks ago, we’re not suggesting we all pile in just for the heck of it. With the 20 day average at $1.62, and shares at $1.58 as of right now, we think there’s still a big hurdle to cross….one we couldn’t get past just a few days ago.

But, we also like the support being made at $1.42. That’s where we bottomed twice in the last month (once before February 3rd, and once after February 3rd). With that line likely to act as a safety net, the risk profile here doesn’t look too bad. Of course, I think we’d all feel even better if WBTO could get - and stay - above the 20 day line. But, that’s the nature of the beast…not knowing for sure.

Based on the chart, and also knowing Web2’s recent corporate story, we still feel this one could be a pleasant sruprise.

Like we predicted yesterday morning, Commerce Planet (OTCBB: CPNE) sold  off on good earnings news…..and I couldn’t be any happier about it. Why? Strictly my opinion, but I think this dip is a short-term event, yet will allow a second chance for anybody to new to jump in at a reasonably low level.

Here are the specifics behind the rationale……

First, look what happened at yesterday’s low of $2.68. Or, maybe I should say look what else is parked at $2.68…the 20 day moving average line - one of my ‘biggies’ in the world of short-term technical analysis. The stock kissed it, and started to recover.

Second, look what else is right there at $2.68…the 38.2% Fibonacci retracement line. The ground floor for those retracement levels are based at $1.44, where the stock took a breather in December. I know some of you may have been eyeing $1.77 as a base line for the Fib numbers, but I personally think $1.44 has a little more meaning. Why? It was the last time we were under the 20 day average…a real test of the bullish conviction here. The January lull never really tested the bulls, and as such, never forced them to draw a specific line in the sand. 

Anyway, it’s more art than science, but I like what I’m seeing so far of the post-announcement CPNE.

No surprises here….the results were impressive right up through the end of the year. Commerce Planet (OTCBB: CPNE) gave some much-anticipated earnings guidance today. The company expects to report revenues of $27.4 million in 2006, versus 2005’s figure of $7.3 million. As far as earnings go, the Planet is looking for $8.6 million in profit, which is like night and day compared to a loss of $6.3 million a year earlier. That translates into earnings of 18 cents per share. The profit margin works out to be a nice 31.3%.

Prediction: I think the numbers are beautiful, right in line with the company’s growth trend. However, I won’t be surprised to see a little selling on the news (‘Buy the rumor, sell the news‘). I’ve just seen these events play out like that, even if it doesn’t make a lot of sense. My only advice is this…don’t over-react, as the selling may well be short lived. Stocks with momentum can and frequently do experience bumps, but the good ones are often quick to recover.

Here’s more.

I’m sure I’ll have more input once we see post-earnings-news action.

It didn’t take Clearly Canadian (OTCBB: CCBEF) long to get rolling with their new organic snack food division….Glengrove Organics - one of the brand names of the recently-acquired DMR Food Corporation - is soon going to be on the shelves of Loblaws. And for those of you not familiar with Loblaws (which we confess included us), it’s just merely Canada’s largest food distributor.

The initial product to be introduced will be one-pound bags of raisins, nuts, sunflower seeds, etc. in a grocery-sized package. Smaller snack-sized packaging is on the drawing board.

Not that this is going to make Clearly Canadian an overnight sensation, but we do think this is a pretty big deal. We’re sure Loblaws will be a high-volume vendor, which is good for margins. And, it could introduce the product to a whole new customer group.

For more, click here.

Long-time readers will probably recall we like corporate management that eats their own cooking, so to speak. With that being the case, we’re impressed by how much of the float (diluted and undiluted) is actually owned by the folks running Titan Global (OTCBB: TTGL)…..we knew it was strong, but wow…..

Management, directors, and strategic investors (whatever that means) currently own 74.8% of the company. If all the warrants and convertible debt are exercised and the float becomes fully-diluted, then those same people will own 73.1%…essentially the same proportion.

Those percentages are based on the currently outstanding shares of 49.1 million, and a fully-diluted outstanding share potential of 65.3 million. The current market cap is $57.5 million, based on Friday’s close of $1.17. As we’ve repeatedly said, we think the current capitalization relative to sales is the opportunity….last year’s revenue was $109 million, and the company was planning on doing $140 million in 2007 before the PCB division spin-off plans. (The sum of both company’s revenues should still be around $140 million.)

People, the average cap/sales ratio is around 2, where TTGL’s is about 0.5. So, by our math, Titan shares are priced at about 1/4 of what they should be. Given some time, we think the market will correct that problem with some major appreciation.

Here’s more about the float and dilution data.

Looks like Challenger Powerboats (OTCBB: CPWB) is still making the most of those boat show appearances. The company announced they’ve signed five new dealers after attending shows in Miami, Los Angeles, and Fort Lauderdale. That’s better than one new dealer per show, and actually picks up the pace set in the latter part of last year when Challenger signed two new dealers after two different shows in Florida. Better still, the dealers signed are interested in the high-end (six figure) ‘go fast’ boats.

Frankly, we don’t think the press release (link is below) does the news justice. We see this as huge news - just huge. The footprint is getting bigger, and combining that with the nice mentions in a couple of industry mags, what we think you have is a big sales catalyst. Just for perspective, in 2005, Challenger’s sales totaled about $1.8 million. We doubt it will be hard to top that figure, given all the new dealers signed on in the last four months.

We’ve said it before and we’ll say it again…..in our opinion, CPWB is going to surprise a lot of people.

Here’s the release.

The blog’s ‘Comments’ sections have been busy lately….seems like some of you really have some insightful thoughts about On The Go’s (OTCBB: ONGO) bizarre market cap numbers, and how the stock can continue to deteriorate. Other readers have turned their focus on Execute Sports (OTCBB: EXCS), thinking the company may have finally gotten itself on track after divesting the snowboard division, and inking the deal with Kawasaki.

To jump into the mix for On The Go, click here and look for the ”Got a question or comment?” link at the bottom of each blog entry. (The number in parenthesis is the number of comments submitted about that blog entry so far.)

If you want to read or post additional comments regarding Execute Sports, click here. Same drill…then click on the ‘Comments’ link.

Don’t be shy though! If you’ve got something to say or ask about any of our companies, just post a message on the appropriate blog page. It’s ridiculously easy, and yes, we review and respond to each post you make - as long as it’s legitimate.

As we mentioned yesterday, feel free to ask questions about any of our older ideas. We can only give our top coverage to a few companies at a time, but we like to revisit old friends sometimes too.

We got this question about Superclick (OTCBB: SPCK) earlier today, which we last covered in October of 2005:

Hi
I own some shares of Superclick. I know that it’s a stock you used to follow and the last few days it’s moving up a little. I can’t seem to find any concrete reason as to why. Any thoughts?
Love the Blog
Thanks  

Yeah, we think we know the main reason….they hired an investor relations firm (again).

Let’s face it - even a great company story can get buried under the avalanche of competing news stories. Unable to sift through that never-ending pile of trading ideas, most investors just have to be content with the ideas delivered to them, as opposed to the ones they actually want. To really tell a good story and get the attention of investors, a smaller company like Superclick pretty much needs an IR firm to spread the word about the opportunity.  

Well, that’s exactly what they did, back in December. Where there was essentially no PR effort in 2006, there’s probably going to be a massive one in 2007. So, to answer your question, we think the reason SPCK is on the move is…..they’re getting attention.

For perspective, in all of 2006, Superclick issued six press releases (and one of those was to announce the IR firm had been hired, and only three of them went to a major wire service). Already in 2007, we’ve seen three press releases - all on major wires. We suspect there are more on the way.

For what it’s worth, a good IR firm really can make a big difference in the way a stock trades. The fact that they hired one at all may also mean the company’s management sees something big (in a good way) on the horizon, and they want to ramp up their stock’s trading activity and awareness. So, we feel this may be a good omen for SPCK’s investors.

Hey everyone, just wanted to give you an early warning so you aren’t surprised later….

…the SmallCap Digest is now going to be called the Small Cap Network Newsletter. We’re still going to be bringing you great small cap ideas and commentary, just like we have for seven years now. However, as we transition into a more user-interactive site, we think the new name will better reflect what we actually are (and that’s a good thing).

In fact, you may have already noticed the new logo. It’s just one a few big things we’ve got in the works.

Though a little less obvious, you may have also noticed our site is now located at smallcapnetwork.com rather than smallcapnetwork.net (though both will take you to the same page for the time being). This switch will also apply to the e-mail address from which you get our newsletter.

Not a big deal, but you may want to go ahead and ’whitelist’ any address ending in ’smallcapnetwork.com’ if you haven’t already. We’ll have complete details on the newsletter e-mail address later, when we get it all tweaked. For more on whitelisting for your particular e-mail service, click here.

By the way, if you absolutely, positively want to ensure there’s no way at all you’ll miss our stuff, we recommend you try an RSS reader/aggregator. Don’t worry - you don’t have to know much more than how to use e-mail to use an RSS (short for ‘Really Simple Syndication‘) feed to get our commentary. In fact, the only tool you need is called a ‘reader’ (also called an aggregator), which looks and works much like an e-mail program. ‘Feedreader‘ is a good one, and costs nothing, but there are plenty of other RSS readers out there as well. Or, if you already have a My Yahoo or My MSN account, you can have our RSS feed displayed there. The best part about an RSS reader is that you control what is placed or not placed in your inbox…meaning you circumvent any unapproved mass e-mailings (i.e. spam). 

The links to make that happen are at the bottom of the left-hand column on any of our site pages.

More details of our evolution are forthcoming.

Up and running now since September 20th of last year, Web2 Corporation (OTCBB: WBTO) today announced a twist that we expect to generate even more sales. The International Chamber of E-Commerce - Web2’s easy website building tool - had previously been marketed by a human sales force, who were paid a portion of any monthly subscription fees created by their customers. Now, anybody who runs a website can generate their own recurring commissions by promoting the service via the Internet.  

Materially, the only thing that’s changed is the sales process. The sales agent was a specific person, and usually dealt with prospects fact-to-face. The new sales path will promote the service directly over the web, generating a commission for the site that actually enrolled the new customer for Web2. The pricing and commission hasn’t changed.

Though minor on the surface, we don’t think this should be taken lightly. We can potentially see this small twist making a big difference in this venture’s revenue.

Why? Two key things. In our guess-timate, the average salesperson fronting for the ICOEC (International Chamber of E-Commerce) may have been (1) not necessarily technically skilled enough to promote a website building tool, or (2) geographically limited to a relatively small target market. It may not have been the case every time, but those were the two key potential barriers we saw.

We think the new web-based sales force may have considerably more luck. Why? Again, there are two reasons…..(1) the audience isn’t limited by geography, and (2) the sale of site-building services is already a proven web-based industry. We feel there’s a very good chance that a potential customer could me much more receptive to this sales process than they may have been with a real-live person - self-service is the norm in the niche.

Though not likely to make WBTO an overnight sensation, we do think this is actually a pretty good move for this particular profit center.

For more, click here.