Challenger Power Boats (fka CPBI)

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From Small Cap Network:


http://www.smallcapnetwork.com/archive/listserv/20070206-1.html


To say Challenger Powerboats (OTCBB: CPWB) has been on a roll lately might be an understatement. The company, after a relatively quiet end to last year, has just been firing on all cylinders lately. And yes, there's another chapter today we think could even further reward shareholders, though they're probably plenty content with the 113% gain so far this year.

(By the way, that was the kind of move we warned you about on December 20th and January 11th. We just hope you were listening then. If not, the good news is it still may not be too late to tap into the rest of the potential we see.)

The latest news installment belongs in the publicity category. The sweet part is it's the kind of visibility you couldn't pay for if you tried....a detailed product review by a trust-worthy third party. Do you think the reinvented Challenger would benefit from a three-page feature in Powerboat Magazine? We sure do. It means thousands of verified powerboat enthusiasts are going to get an up-close look at one of the company's top-of-the-line boats. Even if only a fraction of them make it to the showroom to check the boats out in person, we think it could still be a windfall for the Challenger.

The News



OK, here's the scoop...we mentioned in our January 11th edition one of the major industry magazines had test-driven a Challenger DDC-33. The test drivers are pros, and the reviews are honest opinions. Considering the source, these intense reviews are a major deal for boat manufacturers - a good one could potentially put you at the top of the boating game. Add in the fact that Powerboat Magazine only does 2 or 3 manufacturer reviews per month, and what you have is a very rare but very important opportunity.

Well, though it's not yet on news-stands, we caught an early look and it seems like Challenger made an outstanding impression. The accolades were plentiful, with a particular emphasis on the details the company thinks of when they're building a boat. We have little doubt the magazine's readers will remember the Challenger name when the mood hits to go boat shopping again.

And why is this important to shareholders? Like we said above, sometimes the best publicity is the kind you couldn't pay for if you wanted to. We'd definitely put this magazine mention into that category. Its readers have nominated themselves as a group already interested in powerboats, and the echo effect of getting something like this in print could last for months.

Ultimately, we expect this review to drive some sales. Maybe not tomorrow, or even by the end of the week. But eventually - and sooner than later - we think this is going to bring people to showrooms across the country.

Though we won't even speculate about what kind of dollars it could mean, think about this....the price tag of the model tested by Powerboat Magazine was about $245,000, and the base price of the basic DDC-33 model that was tested is $126,000. Comparatively, in all of 2005, Challenger's revenues totaled $1.7 million. So, if the featured review can only spur the purchase of about 10 boats, it will have basically matched an entire year's worth of sales. To us, given that the magazine is read by thousands of people, it seems pretty realistic. We'll see.

It's just one more reason we've been pounding the table on CPWB shares - this company just appears to be putting together all the right pieces of the puzzle, and we think stockholders are going to be very pleased once the rest of the market figures it out.

Time To Raise The Floor



Our official CPWB trade suggestion went out on December 20th, when the stock was priced at $0.039. Since then, the rally up to Monday's closing level of $0.08 translates into a 105% gain. However, we don't necessarily think we're at the end of the road. You may recall our initial target was 20 cents. That hasn't changed. In fact, if you happened to miss that particular newsletter but are still interested in the opportunity, we think the pause seen over the last four days may be the ideal entry window. We know shares can move big-time without warning. So, if you don't want to have to chase it if we get another upside explosion, then we'd say today could be the ideal time to make a move.

However, if you do happen to be in a trade, the suggested stop of $0.02 cents (in light of the recent runup) doesn't make the best trading sense anymore. We're updating our suggested stop level to $0.05 cents. That still leaves us plenty of room for any volatility, yet is likely to leave us with a small gain even if the $0.05 cent mark is revisited. If and when we get another move higher, we'll consider raising the suggested stop again.

Folks, the bottom line is simple....in our opinion, Challenger shares are still undervalued. At the same time though, we're almost glad they are - we feel it gives our readers a window of opportunity. Just keep in mind that we don't expect the window to stay open too long. Challenger has put themselves back on the map in a hurry, and you may soon have to fight - via a bidding war - for any shares you may want to pick up later. Obviously we think it's better to let someone else get in a bidding war over shares you already own.
Challenger's DDC-33 High Performance Boat Profiled By Powerboat Magazine
Washington, MO - Feb 6 / Challenger Powerboats, Inc. (OTC Bulletin Board: CPWB) today announced that boating industry titan "Powerboat Magazine" has profiled and announced the results of its independent testing of Challenger's DDC-33, in its new March 2007 edition.

Challenger CEO Laurie Phillips stated, "Our boats have been through rigorous testing by independent and highly regarded third parties such as Powerboat Magazine. We could not have been more satisfied with the results, which we believe places us amongst our peers at the higher end of the high performance market segment. This report which comes on the heels of our recently announced acquisition of IMAR and immediately preceding the Miami International Boat Show, has significantly raised our profile within the industry as we now look to leverage this exposure and accelerate our momentum into the 2007 sales season."