Unless you've been hiding under a rock for the past few days, you are aware of the ongoing wildfire situation in Southern California.

45 people have been injured, 5 people have been killed, 500,000 homes were evacuated and so far 1500 homes have been destroyed. While our doors were shut due to a mandatory evacuation earlier this week and the phone lines were temporarily down, things are back to normal here at MSP and everyone here and their families were fortunate enough to come through this disaster unscathed. Unfortunately that is not the case for the hundreds of thousands still evacuated and the many families returning to rubble where their homes once stood.

We'd like to start off this edition by saying that our thoughts and prayers are with all of those affected by the recent catastrophe and are confident that, through the generosity of Americans, these communities will soon be pieced back together again.

CPNE - To Split or Not to Split

So, in the spirit of dusting off the computers and catching up on lost time, we thought we would touch on a few topics that we felt would wrap up the week on a strong note.

After taking investors on a tumultuous ride that saw share price soar upwards into the $3.50 range from under a quarter and then free fall all the way down below a dollar where it sits today, Commerce Planet Inc. (OTCBB: CPNE) announced plans to apply for listing on a National Exchange earlier in the week.

While the move is very positive for the company, it may not be quite so rosy for most current shareholders. CPNE meets or exceeds every possible requirement criteria to trade on a senior exchange, except for one, share price!

So, the obvious move is a reverse split. In my experience, reverse splits carry with them a very negative connotation. This is even truer over the near-term following the split. Long term, those willing to stay on board could be rewarded greatly, but if my dollar today is worth a quarter tomorrow, how can that be positive for me economically until my dollar rises back to its original value? Despite this being a risky move on CPNE's part, we think this company has the wherewithal to execute it successfully.

For long-term holders, this is what we call crunch time. It's time to weigh the pros and cons of sticking it out for a home run or taking some ducats off the table. We have long been believers in CPNE and we still think this company is going to become one of our diamonds in the rough.

We'd love to hear your thoughts and our blog represents a great forum for voicing your opinion.

ATSI Communications: Stellar FY2007

ATSI Communications Inc. (OTCBB: ATSX), one of the most promising companies in our small-cap portfolio, continues to impress the investment community with its improving financials. Management announced last week that revenues for the 4th quarter trumped those of Q3 by almost $2,000,000 and towered over Q4 '06 by nearly 90%. ATSI has now logged 12 consecutive quarters of record revenues, 5 consecutive quarters of positive cash flow from operations and 3 consecutive quarters of net positive earnings per share.

The real game breaker here at this point in time appears to be ATSI's flare for international business. Since the majority of VoIP growth is anticipated to occur in markets outside of the U.S. over the next five years, The Company's ability to establish business relationships with international telecommunications players, including the Mexican government and PCCW Ltd, continues to facilitate an improving financial situation for the company.

ATSI is entrenched in Mexico, the world's number one user of voice traffic along with the U.S., and a $2 billion+ telecommunications market. This has been a key factor driving growth to current levels. ATSI's success in Mexico is facilitated by its (49%) interest of a subsidiary in Mexico, ATSI Communications, S.A. de C.V - that operates under a 30-year government issued telecommunications license similar to the license owned by AT&T's subsidiary in Mexico. Since the Mexican government has a well- documented history of being stringent in its introduction of telecommunications competition and has constructed significant roadblocks to new market entrants, possession of a long-term concession license in the country should be viewed as a major advantage for ATSI.

At a price of just under $.30, we are very bullish on ATSI Communication's potential over the next 12 months.

Nighthawk - Highest Revenues in 4 Years

Nighthawk Systems Inc. (OTCBB: NIHK) provided guidance Wednesday on 3rd quarter earnings that marked the company's highest revenues in the past 4 years. With revenues improving on both quarter-over-quarter and sequential basis, investors embraced the guidance warmly as the stock traded up over 11% to .1140 on volume exceeding 5,000,000 shares. As of 11:00 PST on Thursday morning, share price has held stable. Could we be looking at a new bottom?

Since NIHK recently acquired a high potential IPTV set-top box business and management has stated publicly that revenues for the first nine months of 2007 already exceed those of calendar year 2006, and also that future IPTV related sales could accelerate near-term revenue growth rates by a multiple of two, the market may have awoken to some extent and started pricing that potential into shares. Just a thought. . .

Marmion Industries: Almost Profitable?

Marmion Industries Corporation (OTCBB: MMIO) traded incredibly on Thursday with no news. The stock gained nearly 30% on volume exceeding 4,000,000 shares. For those of you still scratching your head, we thought you might appreciate a tidbit of information we stumbled upon from loyal subscribers. The fact that the market at large is becoming increasingly aware of MMIO's progress may help explain the surge in activity lately.

When you cut out the company's current financing agreement, which is essential in the construction of a new facility that will sustain current growth and allow for higher volume production, MMIO is pretty darn close - if not already - profitable. Which is more than General Motors can say for itself!

As a public company breaks into the market, the amount of capital necessary can often be the company's undoing. This begets the necessity for financing - often an even greater cause of demise. For a small cap company, climbing its way to profitability means chewing through large amounts of debt just to start at ground zero. Knowing the nuances of the small cap industry is vital to understanding how to invest in it wisely. That being said, profitability is not only a rarely achieved