Pat NaccaratoRegis Corp.RGSPAST TOP PICKSep 10, 2008

Our PAST TOP PICK with RGS has triggered its stop at $24.  To remain disciplined, we recommend covering the position at this time.  Combined with previous guidance, this will result in a net investment gain of 1%.  

Our PAST TOP PICK with RGS is progressing well.  To remain disciplined, we recommend trailing up the stop (from $19) to $24 at this time.  

The salon operator of the SuperCuts brand recently reported an operating income increase of 15% along with a 22% growth in revenues.  Cash reserves are growing, albeit along with rising debt.  It trades at 11x earnings and trades under book value.  We recommend maintaining a stop at $19, looking to achieve $36 -- upside potential of 28%.  Yield 0% 

Our PAST TOP PICK with RGS is stagnating.  To remain disciplined, we recommend trailing up the stop (from $17) to $19 at this time.

We reiterate the hair salon franchise company with brands like SuperCuts as a TOP PICK.  The company just bought back 300 salons at 4x earnings -- good value.  It trades at 4x earnings, under book value and supports a great ROE.  We recommend trailing up the stop (from$15) to $17, looking to achieve $31 -- upside potential of 28%.  Yield 0%

Our PAST TOP PICK with RGS has achieved its target at $24.  To remain disciplined, we recommend covering half the position at this time and maintaining the stop at $15.  

RGS operates and manages hair salons with brands like Super Cuts across North America.   The company has been consolidating its foot print, closing less profitable locations, to increase its efficiency and has introduced a reward program and smoother in-store experience.  Recently reported EPS were up over 30% and cash reserves are growing.  We recommend setting a stop-loss at $15, looking to achieve $24 -- upside potential over 25%.  Yield 0%