Stocks Under $10 - ENTR

I am back with a stock under $10 pick - ENTR. If you are new to the site, I do these once a month and my track record is strong (archive for proof):

1st pick: TTWO +49% since call
2nd pick: TIE +67% since call
3rd pick: FEED +98% since call

I bring you ENTR. This stock is broadline semiconductor that has a great story that centers around set-top boxes. In short, they make the chips that goes in them. Verizon, Cox, and Time Warner are winding down on recent inventories and will be placing new orders soon for these DVR boxes, as cable is growing because of the cable transition. I believe this will greatly bring positive impact and boost incremental revenues for both 2009 and 2010 MoCA chip sets are in higher demand, not only in the US but also China. In addition, management is striving hard to improve gross margins to levels above 50%, which in my view is achievable if they make the chips and get them out the door (and of course get the orders - which I believe they will). Cash will burn a little harder throughout this year; however, their DSO is between 55-60 and inventories should improve. Revenue should grow about 60%+ from 2009E to 2010E, when will boost EBITDA by $25m. Based on these assumptions the stock, in my view is worth between $3-$5. Note, we have had a huge run up, so no need to go all-in but for a speculative stock, it's worth a look. Scale is key!

May the streak continue!