Spicy Pickle Near the Top of the Food Chain

When a company is well received by the investing community, it's usually good for the stock. When the same company receives accolades from its respective industry experts, it validates the company. That's why today's news from Spicy Pickle (OTCBB: SPKL) is so important - the honor came from the restaurant community rather than Wall Street. 

Straight to the point ...Spicy Pickle was named #25 out of Fast Casual magazine's 'Top 100 Movers and Shakers' for 2007. The judges looked at 450 restaurants to select the top 100, and then ranked those 100 restaurants. The honor effectively put Spicy Pickle in the top 5.5% of the 'fast and casual' group being considered. 

The criteria wasn't fluff either; the judges panel looked at marketing, compensation, revenue, etc. In other words, they were looking at the business from a business-owner's point of view rather than a consumer's point of view.

The full press release is at the bottom of this article.
 

	The 'Big Deal'

Like we mentioned above, Wall Street's expertise is investing; restaurateur's expertise is restaurants. Sometimes the investing world's intuition is sufficient to make a judgment of a company's merits, but determining the likely success of a food service outfit may be pushing their limits. This is where you'd typically want the experts to step in and decide what works and what doesn't. 

Though we had no doubt Spicy Pickle's menu, pricing, and concept was right on target, hearing it from unbiased industry pros confirms what we've believed all along - the opportunity for the company's growth is real. 

But, if numbers reassure you more than expert opinions do, take this one for a spin...in the first quarter of 2008 Spicy Pickle saw same-store sales increase by 4.64%. 

One of the challenges in evaluating this company has been its pace of growth. The expansion hasn't slowed down enough for us to take a proverbial 'snapshot', so it's been tough to distinguish between organic growth and growth due to new stores. Yesterday, we got a little help from the company on the matter. 

During Q1 of 2007, there were 16 Spicy Pickles in operation (i.e. generating royalties). In Q1 of 2008, those same 16 units saw nearly a 5% increase in the top line on a quarter-over-quarter basis. As such, the company's royalty receipts increased by nearly 5%. 

The message again, however, is validity that Wall Street's analysts just can't provide. Consumers have spoken with real dollars, and have done so in an economic environment where cash wasn't loosely thrown around. Investor opinions on a company are ideas; revenues are facts. 
 

	Through the Roof

If today's chart is any indication, the market is picking up on the two realities we just discussed. 

We said it on Tuesday, but we'll repeat it today ...cleaning up September 24th's gap between 71 cents and 75 cents seems to have been a blessing for the stock. Once the gap was filled on March 3rd, SPKL almost immediately turned around. The March 7th low of 67 cents seems like a distant memory compared to Thursday's high of $1.01.

While we applaud the move - and congratulate those who were patient enough to stick with the stock through Q1 - we'll also acknowledge today's monster surge may be a tough act to follow. That doesn't make it any less deserved...its just tough to keep the throttle on high for that long without inviting some profit-taking. 

If yesterday's and today's news has convinced you of the company's merits, you may want to shop around for a less-volatile entry point. We can't suggest you get overly-stingy though... there are likely to be a lot of competing buyers stemming from all the latest developments. 
 

Immunosyn Just Won't Go Away

Picking small cap stocks is a little bit like buying a new car. You're not always even sure you want to buy a new one, and even if you do, you're not sure which one you want. So, you put your favorites onto a mental list, and then think about them. All the while you're looking for a good price and good financing terms. Eventually, you'll find yourself at the car lot signing a check. It's a journey though.

In a similar way, that's the upside to maintaining a stock watchlist. We discuss a lot of different stocks in the blog and newsletter, each of which goes onto our mental watchlist. Most never go any further than that, but a few of them seem to pan out the way we'd like them to. They're either official or unofficial trades, but keeping an eye on all of them for a while lets us narrow down a large list into a small 'best of' list. 

One of those names consistently making its way to the top of our list lately is Immunosyn Corporation (OTCBB: IMYN). 

We first mentioned it back on March 10th, impressed by its surge, and a little amused by the rally's prompt. What caused the bullish jolt? They submitted some clinical 'before and after' photographs of diabetic ulcer wounds. It's not a completely unusual practice - we just found interesting they submitted the photos to the SEC as official documents for investors to consider. 

Though the stock has not been without its ups and downs, we've seen a basic 'two steps forward and one step back' pattern take shape. Maybe there's something to this young biotech upstart. 

Anyway, we're not mentioning Immunosyn as encouragement to become an owner. We just wanted to illustrate a key point - you have to separate the wheat from the chaff, and sometimes that can take time. 

The strategy worked in our favor recently with Clearly Canadian (OTCBB: CCBEF), which was first brought up a few days before it broke a key resistance level. 

The same patience would have steered you clear of XSUNX (OTCBB: XSNX) and CytoCore (OTCBB: CYOE). Both of those stocks were mentioned in the blog as possibilities, but neither really went anywhere afterwards. 

As they say, patience is a virtue. Just ask Spicy Pickle owners, who are being rewarded for their patience today. Here's the Spicy Pickle news.
 

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Click Here or go to http://www.microcappress.com/disclosure/ to view our compensation on every company we have ever covered, or visit the following web address: http://www.microcappress.com/disclosure/reports_disclosure.php

The Managing Member of Pacific Shores Investments, LLC purchased 200,000 shares of Spicy Pickle at $.25 per share. This purchase was made in a Spicy Pickle private offering back in November of 2006. The Managing Member of Pacific Shores Investments, LLC has also purchased 50,000 shares of Spicy Pickle in the open market with an average cost basis of $.55 per share. Additionally, Pacific Shores Investments, LLC has been paid a fee of $30,000 cash and 250,000 shares of newly issued restricted stock by Spicy Pickle Franchising, Inc. for coverage of the Company.

From time to time PSI sells shares received as compensation for coverage of client companies. Shares received are sold in the open market. Since the shares are received as compensation for services as previously disclosed, and not for investment purposes, PSI does not view the sale of the shares as contradictory to any opinions delivered in the content. This should be viewed as a conflict of interest by shareholders or prospective shareholders of the client companies. 

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