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Thursday, October 18, 2007

Volume Flares Up on Micro Caps

Lots of Action in our Micro Cap World This Week!

Over the weekly hump and it has been a busy week thus far. Although we typically focus on just one company in each edition of our newsletter, an overflow of positive news from our portfolio companies this week has forced us to approach things a bit differently today and bring you our three immediate-term growth front runners.

Before we get into today's news, we thought we'd mention that all of our previous newsletter editions and additional commentary can be found on the MicroStockProfit Blog.

EXCS Sales up Nearly 60%


Execute Sports Inc. (OTCBB: EXCS) announced this morning that overall, year-to-date sales have increased nearly 55% over 2006. The jump from $935,541.31 logged in the first three quarters of 2006 to $1,444,743.67 in 2007 is probably the premier indicator that EXCS has embarked on a new era of growth. Record sales levels also exhibit the company's unique future potential with former Body Glove executive Celeste Berouty situated as President.

Check out our Blog entry from Tuesday for a rundown of exactly why I think this stock has to perform better over the next three to six months.





The market has reacted extremely well to Tuesday's potential $6,000,000 announcement out of Nighthawk Systems Inc. (OTCBB: NIHK) and should grow even more fond of the stock after today's news highlighting an order worth $488,050 - or about 43% more than total second quarter revenues - from a major customer.

NIHK's decision to purchase the IPTV set-top box business assets of Eagle Broadband was a pretty slick move, particularly since the boxes are already generating sales for the company just days after the business segment was acquired.

Nighthawk's current backorder of more than $900,000 exceeds the company's revenues for the entire 2006 fiscal year and exemplifies the forward direction that operations are moving in. Sure I'd like to see the bottom line tidied up a bit, but then again, if they were showing a profit, I'm thinking we'd be around $0.50 or higher versus $0.10. Don't forget that this stock


Marmion Industries Corporation (OTCBB: MMIO) continues to execute on previously announced contracts. After a press release announcing a letter of intent last July, management noted today that they have received a work release notice for a change order valued at nearly $100,000 for a project at the Debakey High School in Houston, Texas.

MMIO also has an additional 20 or so add- ons pending approval which will increase the project's ticket, which I estimate to be worth a hair under $1,000,000.

Today's news is especially great in my opinion because it exhibits management's ability to deliver on contracts. It also helps to solidify Marmion's position in the commercial HVAC market which acts as a pretty nice complement to the industrial business. With ARC Advisory Group forecasting the worldwide market for HVAC control systems to continue growing at a compounded annual growth rate (CAGR) of nearly 4% over the next five years, growing from $10 billion in 2006 to nearly $13 billion in 2011; MMIO has a lot of room to grow.

Management is ramping up sales/marketing efforts and for the first time and pursuing business rather than simply relying of word of mouth to drive revenues. Simply put, I expect monumental growth for the company going forward. With net income of $212,000, as of their last reporting period, continued near-term sales growth, such as that being exhibited recently, could turn this thing around in a major way.

The foundation is in place for EXCS, NIHK, and MMIO and going forward all of these companies seem to do nothing but grow and improve. So why the poor stock performance? Obviously, value here is just increasing. Yet the market seems to waiver in it's faith daily. Eventually, these companies will get their legs in the market and today's prices will be yesterday's news. In the meantime, day traders and long term investors alike should find some good entry points this week.

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