Dow Jones 10695.66 -28.97 10:27 am PST, February 9, 2005  NASDAQ 2067.97 -18.71 For info, visit access.smallcapnetwork.com S & P 500 1197.20 -5.10 Change your subscription status here Russell 2000 632.40 -6.32 VOLUME 05: ISSUE 10  Trading Alert: Micromuse - Cash Mountain. No Debt. Great Prospects. By the way, keep tuned to the SCBLOG for updates, trading ideas and opinion. The latest on Spectrum and others, for example... join the thousands of folks who use the SCBLOG to stay informed. Readers of the SmallCap Digest will know that we've liked the business intelligence space for a long time. One name from the past that has weathered the market storms is business application concern Micromuse (NASDAQ: MUSE). While this call is bound to be controversial given the heights from which the company has come since the bubble days, MUSE's numbers and prospects, we feel, now speak for themselves. We further feel that the growth and potential of both the company and the sector deserve consideration as an accumulation candidate for those risk-oriented investors looking for quality smallcap exposure to the software and business intelligence space. MUSE is a good trader with average daily volume around the million-share range. The price appears to be in a decent uptrend as evidenced by our lines on the right of the chart, which denote the percentage rise from previous bottom to previous top. There seems to be decent support at $4.75 and a stop there would be prudent. The constructive look of the chart, as well as the fundamentals to follow, we believe make the shares a good bet for risk-oriented investors. The 52-week high is $10.55. According to Yahoo, institutions hold 83 percent of the shares. Help me.... While this may seem like rocket science to some, it's really not. I shall attempt to explain. MUSE currently provides software products and services to the likes of--among others-- BT, Cable & Wireless, Deutsche Telekom, EarthLink, ITC DeltaCom, J.P. Morgan Chase, MCI, T-Mobile, and Verizon. I'm sure you've heard of those names... To quote the company, MUSE is "the leading provider of ultra-scalable, real-time business and service assurance software solutions".  Micromuse's Netcool solutions suite of software allows customers to monitor business processes, identify potential problems and provide cutting edge troubleshooting. Like the old BASF ads, MUSE's applications make customers' systems work better and more efficiently (read cost-effectively), whether it's mapping, monitoring or managing critical business applications. To really dig into this technology the website is www.micromuse.com. A look at a five-year chart of MUSE and it's apparent that since its bubble peak at around $100 a share in 2000-01 and subsequent fall to around $1 in late 2002, there may be folks who just don't want to know. That said, as we have seen before, some select companies that survived that period are showing decent prospects and throwing off good fundamentals, now that those days are fading. Not to be too cavalier, but that was then... One has to let those days go at some point. The numbers appear on the numbers. The current and projected numbers are also compelling. Revenue for fiscal 2004 (as at September 30th) was $147 million. For fiscal 2005 and 2006 revenue projections are for $158 million and $175 million, respectively. Per share earnings projections for fiscal 2005 and 2006 are 19 cents and 26 cents. At the current price of $5.40, that evidences decent price earnings ratios of 28 times and 21 times, respectively.  Interesting as well is the fact that in the last 30 days, virtually all the analysts that cover the company revised their 2005-2006 projected earnings numbers upward. As well, MUSE has no debt. And, by our calculation, has about $193 million in cash and equivalents or approximately $2.50 per share. As well as gaining new business, MUSE enjoys significant repeat and renewal business from existing customers providing solid testament to its viability and growth potential. The need for troubleshooting and streamlining business systems and processes has gained significant traction over the past few years and it's apparent that MUSE is in the thick of that growth. For those investors who want exposure to an established, growing company, with great fundamentals, we feel that MUSE fits the bill.      We Value Your Feedback Got comments, questions or suggestions? Send 'em on over: Editor@smallcapnetwork.com If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 3525 Del Mar Heights Rd #334 San Diego, CA 92130   Unsubscribe Here D I S C L A I M E R: The SmallCap Digest is an independent electronic publication committed to providing our readers with factual information on selected  publicly traded companies. SmallCap Digest is not a licensed investment professional or broker-dealer. All companies are chosen on the basis of certain financial analysis and other pertinent criteria with a view toward  maximizing the upside potential for investors while minimizing the downside risk, whenever possible.  Moreover, as detailed below, this publication accepts compensation from third party consultants and/or companies which it features for the publication and circulation of the SmallCap Digest or representation on SmallCapNetwork.net.  Likewise, this newsletter is owned by TGR, LLC.  To the degrees enumerated herein,  this newsletter should not be regarded as an independent publication. Visit Here to view our compensation on every company we have ever covered, or visit the following web address:  http://access.smallcapnetwork.com/compensation_disclosure.html for our full compensation disclosure and http://access.smallcapnetwork.com/short_term_alerts.html for Trading Alerts compensation and disclosure. TGR Group LLC has not been compensated for this report. All statements and expressions are the sole  opinions of the editors and are subject to change without notice. A profile, description, or other mention of a company in the newsletter is neither an offer nor solicitation to buy or sell any securities  mentioned. While we believe all sources of information to be factual and reliable, in no way do we represent or guarantee the accuracy thereof, nor the statements made herein. From time to time TGR Group LLC sells shares in the open market it receives as compensation for coverage of client companies. Since the shares are received as compensation for services as previously disclosed, and not for investment purposes, the editors do not view the sale of the shares as contradictory to any advice delivered in the content. This should be viewed as a conflict of interest by shareholders or prospective shareholders of the client companies. The editor, members of the editor's family, and/or entities with  which the editor is affiliated aside from TGR Group LLC itself, are forbidden by company policy to own, buy, sell or otherwise trade stock for their own benefit in the companies who appear in the publication unless specifically disclosed in the newsletter. The profiles, critiques, and other editorial content of the SmallCap Digest and SmallCapNetwork.net may contain statements that appear forward as it relates to the expected capabilities of the companies mentioned herein. THE READER SHOULD VERIFY ALL CLAIMS AND DO THEIR OWN DUE DILIGENCE BEFORE INVESTING IN ANY SECURITIES MENTIONED. INVESTING IN  SECURITIES IS SPECULATIVE AND CARRIES A HIGH DEGREE OF RISK. THE INFORMATION FOUND IN THIS PROFILE IS PROTECTED BY THE COPYRIGHT LAWS OF THE UNITED STATES AND MAY NOT BE COPIED, OR REPRODUCED IN ANY WAY WITHOUT THE EXPRESSED, WRITTEN  CONSENT OF THE EDITORS OF SMALLCAPNETWORK.NET. We encourage our readers to invest carefully and read the investor information available at the web sites of  the Securities and Exchange Commission ("SEC") at http://www.sec.gov and/or the National Association of Securities Dealers ("NASD") at http://www.nasd.com. We also strongly recommend that you read the SEC advisory to investors concerning Internet Stock Fraud, which can be found at  http://www.sec.gov/consumer/cyberfr.htm . Readers can review all public filings by companies at the SEC's EDGAR page. The NASD has published information on how to invest carefully at its web site.