Dow Jones 12050.41 -63.69 4:29 am PST, March 6, 2007 NASDAQ 2340.68 +0.00 For info, visit access.smallcapnetwork.com S & P 500 1374.12 +0.00 Change your subscription status here Russell 2000 760.06 +0.00 VOLUME 07: ISSUE 26 Challenger Powerboats Hits The Throttle We know we've been zeroing in on Challenger Powerboats (OTCBB: CPWB) the last few weeks, but hey - it's where the action is right now. If there was an aquatic equivalent to 'burning up the pavement', we'd have to say Challenger is doing it. The best we could come up with is 'making waves', but somehow that just doesn't seem to do the story justice.  In any case, here we are again with what we think is even more proof the company has come full circle with their turn-around plans. While the early-bird investors have already put some bullish distance between their entry and the current trading level, in our view, the recent news - especially today's news - points to even more upside potential.  The press release is below, but as usual we've offered up what we think is the explicit benefit for shareholders - you know...the meaning behind the news. See if you agree with our take on why Challenger is still one of the small cap market's best opportunities of the year.    The Whole is Greater Than the Sum of the Parts Yep, it's perhaps one of the most overused cliches in the world - particularly in the business realm. For the life of me though, I couldn't think of an easier and better way of saying it.  What we're talking about is the combination of the Challenger, Sugar Sands, and Gekko lines of boats. Individually, each brand name was solid enough to stand alone. However, when you co-market all three lines side by side, the entire 'package' simply appears more legitimate.  As much as we'd like to say the increased-legitimacy concept was ours, we can't. Challenger CEO Laurie Phillips was the one who pointed the idea out to us a few weeks ago.....after the Gekko and Sugar Sands lines were acquired, and in the midst of this year's early boat shows. And who pointed it out to her? Mostly the dealers at the same boat shows. Apparently - and this is the kind of behind the scenes info you probably won't get anywhere else - the more lines you carry, the easier it is to attract new dealers. We wouldn't have necessarily thought that mattered in the high-end boat world, but it makes sense to us....dealers like to work with manufacturers they can have confidence in. Being able to offer multiple lines the way Challenger now does seems to command confidence; the company just looks bigger.  However, it's not as if we just unraveled the great mystery of life or sales here - Challenger has been doing just fine for weeks now without our help...by acquiring new lines, adding dealers, getting attention, and selling boats.    December 20th, 2006 - Challenger signs another dealer after signing one just a few days earlier. Both have a major footprint (one with an overseas presence). More dealers are in the works.  January 31st, 2007 - Challenger acquires IMAR Group (which includes Sugar Sands and Gekko). IMAR did $12 million in sales in 2006, and brings over 100 dealers to the table, which are now potential dealers for the Challenger line.  February 13th, 2007 - A Challenger boat is featured in Hot Boat magazine, just a few days after another Challenger boat was featured in Powerboat Magazine. Both have major circulation within boating enthusiast circles.  March 6th, 2007 - Within a span of just a few weeks in early 2007, Challenger has reported $725,000 in Sugar Sands orders (31 units) on top of the $330,000 in confirmed Challenger Powerboat orders (3 units) from last month. (See press release below.) Add that to the eight Challenger's sold in Q4 of last year for roughly a million bucks. That pace is already better than last year's IMAR/Challenger combined results, so we're assuming 2007 results are indeed going to show a nice top line improvement. To be perfectly blunt, we're not even marginally surprised to see these big sales figures rolling in now. They went out and got the sales talent, they already had the technology, they started hitting the show circuit, and they widened their footprint by adding other kinds of boats like Gekko and Sugar Sands. They told everyone they were going to do exactly this last fall...then they went and did it. Fortunately for anybody who missed the memo(s), we don't think the party's over yet. Though the 'newness' of the IMAR acquisition and the boat show strategy has worn off, the company just now seems to be getting fully in that groove - firing on all cylinders. Once they really get up and running, we suspect even bigger and better things will mean some serious rewards for shareholders.    Don't Blink - You May Miss the Opportunity We hope any interested investor jumped in when we were pounding the table back on December 20th, while shares were at 3.9 cents. If you did, you're sitting pretty at the current level of 10 cents...enjoying your 156% gain. If not, don't sweat it too much - we also think there's plenty more upside left to go.  However, we don't necessarily think there's a lot of time to mull it over. Since the initial surge in late January, we've only seen two dips we'd consider deep enough to really make a meaningful difference in your entry level. And both of those pullbacks were so short-lived, you most likely would have needed to decide well ahead of time if you were going to jump in when you got a chance.  The first time we learned the lesson was on February 14th, when the stock fell from 11.4 cents to a low of 7 cents. The next day's low was only 9 cents, and the bulls kept pushing it higher for days. The second instance of a short-lived dip was seen just a couple of days ago. Falling all the way to a low of 9 cents on Friday after a week-long lull, we seem to have gotten back in 'gain' mode at the beginning of this week.  The point is, we feel the window of opportunity is opening and shutting pretty quickly. So, if you're going to get involved as an owner but are waiting for the perfect time, we'd say you're probably better served by not being quite so picky about your entry (you know...penny-wise and pound-foolish). Our target remains at 20 cents, which could translate into very nice gains as long as you got in anywhere near the current trading level of 10 cents. Do you really want to be on the sidelines for this one? We sure wouldn't.   Challenger Announces $725,000 In New Orders For Its 'Sugar Sand' Jet Boats  Washington, MO - Mar 6 / Challenger Powerboats, Inc. (OTC Bulletin Board: CPWB) today announced that it has received dealer purchase orders for 31 new Sugar Sand jet boats. The aggregate value of the orders is approximately $725,000.  Challenger CEO Laurie Phillips stated, "Jet boats are one of the fastest growing sectors of the recreational boating market. That dynamic clearly factored into our recent decision to acquire IMAR and the 'Sugar Sand' brand. As a result, we believe we are well positioned to benefit from the growth in this market niche." She added, "In just the past several weeks, we've announced over $1.1 million in new orders. Clearly our product synergies are beginning to jell as a number of our dealers have begun placing orders for several of our lines be it 'Challenger', 'Sugar Sand' or 'Gekko'."  About Challenger Powerboats, Inc.  Challenger Powerboats, Inc. designs and manufactures high performance 'go fast' offshore racing boats, family sport cruisers, jet boats and water ski tow boats under the brands 'Challenger Powerboats', 'Sugar Sand' and 'Gekko', which target the recreational boating market. Proven world-class technology is incorporated into the manufacturing of our award winning boats at the Company's 65,000 sq. ft. facility located on our 12 acre complex in Washington, Missouri and 80,000 sq. ft facility in Fargo, North Dakota. The Company's boats are sold through our dealer network in the United States, Canada, Mexico, Europe, Australia, the Middle East and Japan. In 2006, Gekko was selected as an official tow boat for the World Barefooting Championships, and the European Barefooting Championships in 2005.  For further information about Challenger you may visit www.challengerpowerboats.com, www.sugarsand.com, www.gekkosports.com or www.sec.gov to view the Company's public financial information and filings.  Forward - Looking Statements  This release contains forward-looking statements, including, without limitation, statements concerning our business and possible or assumed future results of operations. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons including: our ability to continue as a going concern, adverse economic changes affecting markets we serve; competition in our markets and industry segments; our timing and the profitability of entering new markets; greater than expected costs, customer acceptance of our products or difficulties related to our integration of the businesses we may acquire; and other risks and uncertainties as may be detailed from time to time in our public announcements and SEC filings. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and our future results, levels of activity, performance or achievements may not meet these expectations. We do not intend to update any of the forward-looking statements after the date of this document to conform these statements to actual results or to changes in our expectations, except as required by law.  Contact:  Michael Novielli  Chairman  Ph (845) 575-6770 x202   We Value Your Feedback   Got comments, questions or suggestions? Send 'em on over: Email the Editor If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 4653 Carmel Mtn Rd Suite 308 #402 San Diego, CA 92130 Attention Readers! Do You Want To Keep Getting This Newsletter?  OK faithful followers, the clock is ticking. We already mentioned the name of our publication would be changing from the SmallCap Digest to the Small Cap Network Newsletter, and today you can see the new logo is in place.  However, in order to ensure you continue to receive our e-newsletter, you may need to take action ASAP! To try and minimize any problems with receiving the newsletter, we highly recommend at least taking these two actions....  1) 'Whitelist' all email with 'smallcapnetwork.com' AND 'smallcapnetwork.com' in the 'From' (or Sender) header.  2) If modifying an existing whitelist entry for the newsletter, replace all occurrences of 'smallcapdigest' with 'smallcapnetwork'. Also, replace 'lyris.smallcanetwork.net' with 'lyris.smallcapnetwork.com'.  For additional help on whitelisting, please see our instructions located here.  For additional assistance getting the newsletter delivered, please write to our webmaster.    Titan Details Strategy In Writing Titan Global Holdings (OTCBB: TTGL) unveiled their strategic initiatives for 2007 yesterday. If you've been following the story since we've been covering them, odds are none of it will surprise you....they're looking to grow the pre-paid phone card and wireless business through heavy acquisitions, and then reduce costs with their new size. And, the PCB divisions are still going to be spun-off, as they may do even better if run separately.  If you're a new-comer, or just looking for a refresher, we recommend you take a look at the press release in detail by clicking here - it pretty much summarizes the highlights we've examined since we began our analysis on January.    Canada's Largest Media Company Chooses Stockgroup We've expressed our opinion over and over again.....Stockgroup Information Systems (OTCBB: SWEB) has an incredible technology that we think puts them well ahead of their peers. But, if you're tired of hearing us say it, maybe the company's newest partnership can send the same message. CanWest - Canada's largest media company - has contracted Stockgroup to provide the platform for their recently-enhanced site financialpost.com.  We think the relationships' very existence speaks volumes about Stockgroup's stature. CanWest had plenty of choices, including the option to build the offer themselves. But instead they chose to integrate the Stockgroup offer as their own. If Stockgroup is what CanWest wants, we think it speaks very highly of Stockgroup.    Justin Morneau Now At Bat For Clearly Canadian With the boys of summer putting the finishing touches on spring training, it looks like Justin Morneau of the Minnesota Twins will be doing more than playing first base this season - he's been named as Clearly Canadian's (OTCBB: CCBEF) newest spokesperson.  Morneau was something of an obvious choice for Clearly. Aside from the fact that he was the American League's MVP in 2006, he's also a British Columbian....where Clearly Canadian is headquartered.  No word on any specifics, but for more on the agreement, click here.  Subscribe Information is power and timely information is profitable. Become informed and profit from Small Cap Network Profiles and Trading Alerts by becoming a Preferred Member today. There is no cost associated with your email subscription. 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To the degrees enumerated herein, SCN should not be regarded as an independent publication.  Click Here or go to http://access.smallcapnetwork.com/compensation_disclosure.html to view our compensation on every company we have ever covered, or visit the following web address: http://access.smallcapnetwork.com/profile_disclosure.html for our full profiles and http://access.smallcapnetwork.com/short_term_alerts.html for Trading Alerts.  On January 19th, 2007 TGR Group LLC entered into an agreement with Stock Group Media, Inc. (a wholly-owned subsidiary of Stock Group Information Systems, Inc.) whereby Stock Group Media, Inc. will provide $50,000 worth of advertising and marketing services to TGR Group, LLC in exchange for coverage of Stock Group Information Systems, Inc. on the Small Cap Network web site and newsletter. TGR Group LLC has been paid a fee of $30,000 cash by Titan General for coverage of the company. 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