(CRYP) - (HURC) - (PWEI) - (UNT) - Upside newsletter - some truly cheap stocks

Richard Moroney, editor of the Upside newsletter, put together a list of nine companies that represent attractive picks for investors looking to add some truly cheap stocks to their portfolios. Read this featured expert's updates on a couple of these standout values, a developer and supplier of online casino and poker software as well as a maker of computer-controlled machines for the metalworking industry. Commentary A large body of academic research suggests value-related metrics work well with small and midcap stocks, and value metrics feature prominently among the most effective variables in Richard Moroney and his team's Quadrix® rating system. The Quadrix Value score — reflecting a weighted average of such ratios as price/earnings and price/cash flow, along with those ratios relative to historical norms — has been highly effective in real-time use since 2000 and in back-tests to 1980. Historically, stocks cheap based on several valuation measures have provided especially good returns. The stocks listed below are cheap based on seven of the most effective Quadrix variables and earn Value scores above 91, placing them among the cheapest 9% of the roughly 5,000 U.S.-traded stocks in Moroney and his team's Quadrix universe. Stocks are usually cheap for a reason, and the ones listed below face likely slowdowns in profit growth over the next year. Most battle in highly cyclical markets against larger rivals, and several face major company- specific risks. Owning just one or two of these stocks is a fairly risky proposition, which is perhaps one reason such stocks have compensated shareholders with above-average returns over the long haul. Still, history suggests that holding a diversified basket of small and midcap value stocks is a winning strategy, and the 38 stocks on Moroney and his team's Buy List include 19 with Quadrix Value scores above 80. The stocks listed below represent attractive picks for investors looking to add some truly cheap stocks to their portfolios. At the end of June, Canada-based CryptoLogic (CRYP), a developer and supplier of online casino and poker software, had no debt and cash of $127 million, or more than $9 per share. Cash flow and free cash flow have trended higher in recent quarters, reflecting outstanding operating results. Per share earnings jumped 72% on a 43% sales gain in the first half of 2006, and strong growth should continue in the second half. Hurco (HURC), a maker of computer-controlled machines for the metalworking industry, trades at a modest valuation despite outstanding operating momentum. Helped by strong sales of high-priced models, particularly overseas, revenue jumped 24% in the July quarter. Pretax income surged 70%, though net income was up 32% because of a higher tax rate. The stock has been pressured by concerns about a possible industry slowdown. But new orders jumped 32% in the July quarter, with strong demand in Europe and Asia. U.S. orders were up only slightly in the July quarter. Hurco is stepping up production at its Taiwan facility to meet rising Chinese demand. It also recently opened a new technical center in Shenzhen, China. Additional samples of the 9 standout values include: PW Eagle (PWEI) is a leading extruder of PVC pipe and polyethylene tubing products. The Company operates eight manufacturing facilities in the midwestern and western United States. Trico Marine Services (TRMA) provides a broad range of marine support services to the oil and gas industry, primarily in the North Sea, Gulf of Mexico, West Africa, Mexico and Brazil. The services provided by the Company's diversified fleet of vessels include the marine transportation of drilling materials, supplies and crews, and support for the construction, installation, maintenance and removal of offshore facilities. Unit (UNT) is engaged in the land contract drilling of oil and natural gas wells, the development, acquisition and production of oil and natural gas properties, and the marketing of natural gas. Its principal areas of operations are located in the Anadarko and Arkoma Basins, which cover portions of Oklahoma, Texas, Kansas and Arkansas and has additional producing properties located in other states, including but not limited to, New Mexico, Louisiana, North Dakota, Colorado, Wyoming, Montana, Alabama and Mississippi. Content Courtesy: Zacks Investment Research | Blog Home| VitalStocks Home