Stockchase Opinions

Scott Morrison Chartwell Technology Inc. CWH-T BUY Jan 14, 2005

On their radar screen. Very bullish on the gambling sector. Well managed and management own a lot of it.
$5.970

Stock price when the opinion was issued

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HOLD
There's a huge move in the online gambling space right now. The space is hot. This one is running because there is a UK gambling bill that may change perception of the industry and investors are much more receptive of the story in Europe.
TOP PICK
Internet gaming space. Have some good clients, good traction. Now in a market cap range where more people are paying attention to it.
BUY
One of their customers "Bet & Win" was accused by an anti gambling group of cheating on their taxes. Thinks this was massively over blown. Will be reporting earnings this week and numbers should be good.
PAST TOP PICK
(A Top Pick May 10/05. Down 40%.) Has been a huge disappointment. They missed their last earnings numbers. Even though the internet gambling space has been hot, they are deemed to be the loser in this space. Too cheap to sell at this time.
DON'T BUY
Sold Chartwell (CWH-T), Cryptologic (CRY-T) and Great Canadian Gaming (GCD-T) and when they moved down in his models at the end of June. When a stock takes a loss of 8/9%, you should take a good hard look as their first loss is usually their smallest. In the bottom 1/3 of his database. Have another look at it in 3/6 months.
DON'T BUY
Basically a gaming software company. Went up to 50 Xearnings which was way too much and going forward it's not going to be that easy for them to keep growing their earnings.
BUY
Thinks it has bottomed. The whole space fell apart in the late summer. This one continues to chug along in adding new customers. From a valuation viewpoint, it is far more realistically valued than it was at $12. Still a little concerned that the space hasn't rolled over, so you may get a bit of a pause here.
DON'T BUY
Ranked 586 in his database model. Would prefer Cryptologic (CRY-T) which ranks 142.
DON'T BUY
Have gotten out of most of the gambling stocks. US banned internet gaming which dropped the stocks back.
PARTIAL SELL
Software manufacturer for the online gaming industry. Took a tremendous hit in 2005/2006 when US government disallowed funds to be held in the US. Its clients were primarily in Europe. Stock has done very well since the beginning of the year. Has about $0.80 per share in cash. Consider taking some profits. Valuation still looks relatively solid.