‘Well-Heeled’ Buys

02/02/2007 12:00 am EST

Focus:

James Oberweis

President, Oberweis Asset Management, Inc.

In his latest missive to his subscribers, expert stock-picker Jim Oberweis offers two tech stocks, as well as a company taking advantage of one of the newest hot trends to descend on the teen retail industry...

"Heelys, Inc. (HLYS NASDAQ GM) designs, markets, and distributes innovative, action sports-inspired products targeted to the youth market. The company's primary product, HEELYS-wheeled footwear, is patented, dual-purpose footwear that incorporates a stealth, removable wheel in the heel. The footwear allows the user to seamlessly transition from walking to running or skating by shifting weight to the heel. In the nine months to September 30, 2006, sales increased approximately 300% to $117.1 million. Net income was $17.6 million versus $2.9 million in the same period of 2005. HEELYS completed its initial public offering (IPO) of 3.125 million shares on December 8, 2006 at $21 per share. Clients of Oberweis Asset Management participated in the offering and own approximately 479,000 shares. These shares may be appropriate for risk-oriented investors.

"Numerex Corp. (NMRX NASDAQ GM) is a leading provider of wireless fixed and mobile machine to-machine (M2M) solutions, as well as a broad range of reliable, competitive network services and technology. Numerex enables real-time wireless data communications, monitoring, tracking, and service management tailored to the needs of each application, customer and industry, from vehicle location and tracking, to vending, security and utilities. Wireless M2M network services and solutions are delivered through the company's Airdesk Wireless division. In the third quarter, sales increased approximately 65% to $13.2 million. Earnings per share were $.07 versus $.03 in the same period of 2005. Clients of Oberweis Asset Management own approximately 240,000 shares. These shares may be appropriate for risk-oriented investors.

"DIVX, Inc. (DIVX NASDAQ GM) develops digital video software used in codec applications for video hardware original equipment manufacturers. The company's video codec, available on its website DIVX.com, has been downloaded over 200 million times since its release. DIVX also licenses its compression decompression technologies to consumer electronic manufacturers including Phillips, Pioneer, RCA, and Toshiba. DIVX hopes to make its codec the industry standard by incorporating its technologies into an array of consumer devices including DVD players, digital cameras, smart TV's, set top boxes, and game consoles. For third quarter ended September 30, 2006, sales increased approximately 83% to $15.4 million up from $8.4 million in the same period last year. Net income was $3.1 million versus $0.8 million for the same quarter a year ago. Clients of Oberweis Asset Management own approximately 502,000 shares. These shares may be appropriate for risk-oriented investors."

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