STOCK OF THE WEEK: RUSSELL

My family has owned Reebok (RBK) since 1985. The stock has done well and we are in no hurry to sell. However "well" is a relative term.

During the time we owned RBK it has increased in value by 1,100%. When we bought the stock, it looked like a value relative to Nike (NKE); it still does. During the time that we made 1,100%, NKE went up 7,600%! RBK pays a slightly larger dividend than NKE and this dividend is in addition to the capital appreciation. Jeremy Siegel makes the case that dividends add more to the total return than one would think but I doubt that the small dividend difference in these companies is enough to worry over. One lesson to take away is that generally it is best to buy the industry leader.

"Well" really is a relative term. Had we purchased Russell Corp. (RML) on January 2, 1985, our capital capital appreciation would have been 17%; not 17% per year but 17% total since 1985.

Comparing a "t-shirt" maker to Nike is unfair; calling Russell a "t-shirt" maker is unfair; but remember one of our themes is to buy stocks that are "under-loved". We now know that Nike is one of the most successful brands ever. Russell makes quality products and survived a very difficult 20 years in the apparel industry. The comparison of the three companies, shows that investing is an art. Buying good value is always the right approach, but value is a reflection of growth potential, management skill and many other factors.

The following report is about a solid company. A company that is probably a better company than is commonly thought. It does not have the panache of Nike but it is a cheap stock by several measures and we have made it our Stock of the Week.

Russell Corporation has the products to meet the needs of the serious athlete, the weekend warrior and everyone in between. Founded in 1902, The Russell Corporation located in Atlanta, GA. runs every step of the manufacturing process, from weaving raw fibers into fabric to dyeing, cutting, and sewing. RML designs, manufactures and markets a variety of apparel products. These products include fleece, t-shirts, casual shirts, jackets, athletic shorts, socks and camouflage attire for men, women, boys and girls. With eleven brands, Russell Corporation has something for everyone.

The Russell Athletic division is the world's largest supplier of team uniforms and is the Official Uniform Supplier to 14 Major League Baseball(R) teams, Little League Baseball(R), and USA Baseball(TM). Russell outfits over 200 NCAA(R) Division I college teams and is an Official Sponsor of the Women's Basketball Coaches Association (WBCA), the American Baseball Coaches Association (ABCA), and the National Fastpitch Coaches Association (NFCA). Russell apparel can be found in a variety of department stores and sports specialty retailers nationwide.

The JERZEES division is a major supplier of fleecewear and T-shirts to retailers and screen printers. Russell purchased SHC's sporting goods business (Spalding and all other non-golf brands) in May 2003.

The company holds a firm commitment to a very simple philosophy, "do the right things for the right reasons." In today's competitive global marketplace, Russell feels its greatest strength is its people. It employees 14,400.

Russell Corporation supports non-profit organizations with product donations, cash contributions and employee volunteer hours. The company focuses its efforts on programs, projects and activities that benefit the communities where its employees live and work. By working hand-in-hand with the local communities, Russell strives to make a difference in the towns and cities around the world that its employees call home.


Over the last two years, Russell has made the following acquisitions:
* December, 04 acquired Brooke Sports
* July, 04 acquired Huffy Sports
* April, 03 acquired Spalding
* Jan, 03 acquired Bike Athletic

On February 23, 2005 Russell Corporation reported fiscal 2004 fourth quarter sales of $334.0 million, an increase of 10.5% over the same period a year ago; 9.4% for the year. Sales for the quarter ended January 1, 2005, reflect a 3% increase in the Company's ongoing businesses in addition to approximately $22 million dollars in incremental sales from acquisitions owned for less than a year. Sales gains were again recorded for the Activewear Group, the Athletic Group and the International apparel segment.

"During the fourth quarter, sales increases in our domestic segment were led by our Athletic Group. Increases in Athletic were driven by our recent acquisitions, which have solidified and grown our position as a leading branded athletic and sporting goods company. Our International apparel segment continued its sales growth pace, with increases of more than 20% for the quarter and the year," said Jack Ward, chairman and chief executive officer. "For the quarter, our Activewear Group had a 3% increase in revenues, led by our JERZEES(R) sports apparel in the mass channel."

For the full year ending January 1, 2005, net sales increased $112 million to $1.298 billion, a 9.4% increase over the prior year's sales of $1.186 billion.

Those of you who are familiar with Jack Ward, know a fierce competitor. Back in the days when he was at Sara Lee, there was no one in Winston-Salem who garnered more respect. I lost track of Jack some years ago but seeing the number of acquisitions made by Russell in recent years and then reading Jack's name as CEO was a revelation. It made the idea of buying this historically slow growing stock a no brainer.

Russell expects sales for fiscal 2005 to increase approximately 15% to 17%, to approximately $1.50 billion to $1.52 billion.

The 52-wk high (12/28/2004) is $ 19.78 and 52-wk low (5/18/2004) is $ 15.60. The closing on April 27th was $17.70.

We hope you are a disciplined investor. One who diversifies into 12 to 20 stocks, who trades infrequently, who makes his own decisions, who lets winners run and cuts losers short and one who keeps commissions low. AS ALWAYS, WE MAKE NO RECOMMENDATIONS. INVEST AT YOUR OWN RISK!

STOCK OF THE WEEK: Weider

click here for more information on Weider Nutrition International

Without the necessary vitamins, minerals, and nutrients our bodies fall into a degenerative state, known as aging. You need the necessary amino acids, minerals, proteins, and vitamins to revitalize proper cell regeneration and without them, the body falls faster into disrepair. A little over fifty years ago, Denham Harman, a researcher at the University of California at Berkeley, realized one reason why people get old. Free radicals, molecules that can attack cells, are responsible. He theorized that substances found in our bodies and in food called antioxidants might just slow the damage.

Harman's free radical theory of aging was initially greeted with a mix of apathy and criticism. Industrial chemists had long known about free radical reactions--for example, free radicals make iron rust--but most scientists had doubted that they occurred in living creatures. That was then; this is now. Nutrition.

Today, thousands of studies have corroborated Harman's theory. "Antioxidant" has become a household word, and, according to the Nutrition Business Journal, Americans spend billions of dollars on antioxidants each year. Antioxidants can reduce your risk of heart disease, cancer, and Alzheimer's. They might even increase your life span.

While research shows that exercise and a nutritionally balanced diet can help improve our health, it also shows that our food supply is not what it used to be. Commercial practices such as over-harvesting are thought to contribute to the problem. The considerable evidence shows that supplements can help.

The Nutrition Industry facts reported sales of $63 billion dollars just 2 years ago and they project a steady climb in growth over the next 5 years.

Weider Nutrition International (WNI), located in Salt Lake City, UT develops, manufactures, markets, distributes and sells branded and private label vitamins, nutritional supplements and sports nutrition products. Weider distributes its products to over 60,000 retail locations. Using health food stores, drug stores, supermarkets, gyms and mass volume retailers like Costco and Wal-Mart, which account for about 50% of their sales. Their portfolio of recognized US brands include Schiff®, Weider Sports Nutrition, and Tiger's Milk® Protein Bars.

The Group is organized into three business units: The Schiff Specialty Unit which markets a complete line of specialty supplements, vitamins, and minerals under the Schiff brand as well as private label products. The Active Nutrition Unit develops and markets sports nutrition, nutritional bar and weight management products primarily under Weider and Tiger's Milk brands. Tiger's Milk, introduced in the 1960s, is known as America's first nutrition bar. Last but not least, another division called Haleko develops, manufactures, and markets nutrition products primarily under the Multipower and Multaben brands. Weider operates in the United States, Germany and South America.

History:Joe Weider is credited as the founder of the Sports Nutrition Industry in 1940. The company has a rich history as a leader in the nutritional supplements industry. Weider Nutrition began as the nutritional products division of Weider Health and Fitness. In 1989, Weider Health and Fitness established its three principal business divisions (Sporting Goods, Nutrition and Publications) as independent subsidiaries. The 418,000 square foot Salt Lake City manufacturing facility, opened in 1997, provides Weider with the capacity to quadruple its current annualized sales. In June 1999, Bruce Wood joined Weider as President and Chief Executive Officer. Mr. Wood brings over 25 years of food industry experience, primarily with divisions of Nabisco, Inc.

The Weider Group feels the key to the long-term growth has been the success of core brands. Weider is focused on supporting and building the strongest brands and developing and marketing high quality, innovative new products that meet consumer needs and demands.

As part of brand building and product development efforts Weider announced the sale of certain assets of its Active Nutrition Unit to Weider Global Nutrition, on April 1, 2005. A wholly owned subsidiary of Weider Health, a privately held company in California and the majority stockholder of the company. Bruce Wood, president and CEO, stated, “The sale of the Weider branded business enables us to focus on our core businesses: the Schiff Nutritional Supplements Brand and the Germany based Haleko business.”

Weider knows that anticipating and meeting customer needs is critical. The company has a track record of developing first-to-market products. To continue to seize these opportunities, the R&D and marketing teams are working closely together to develop and carefully test highly-targeted products. Each new product has anticipated measurable return on investment goals.

On November 11, 2004 The Schiff Group introduced a new joint care supplement called Lubriflex3™ that provides fast-acting joint comfort and promotes better joint health. The product’s triple action formula combines Uniflex™, Lubriflex a powerful antioxidant that protects cartilage and joints, with Joint Fluid, a compound that helps joints glide easily and smoothly, and Glucosamine, an ingredient well-known for supporting joint cartilage and maintaining healthy joint function. The net result is a faster-acting supplement that can provide improved flexibility and joint function in just a few days.

By adding Uniflex™ and Joint Fluid to Glucosamine, Schiff® is breaking new ground in the supplement industry. Emerging results from an ongoing study show that in the very first week of use Schiff® Lubriflex3™ was dramatically more effective than Glucosamine alone in improving overall joint function. In fact, 83% percent of users reported that they experienced improved joint comfort. 78% said that they could even function better during daily activities and 72% showed improvement in physical functioning scores.

“The wonderful thing about Lubriflex3™ is that it can do what traditional pain relievers don’t by addressing the root cause of the joint discomfort,” said Luke Bucci, Ph.D., vice president of research for Schiff®. “Glucosamine has earned its reputation as a truly effective supplement when it comes to building joint cartilage. By adding the comforting properties of Uniflex™ and the protective actions of Joint Fluid lubrication to the equation, we’ve found a powerful, faster way to provide joint comfort.” Suggested retail price of $22.99-$25.99 for a 60-count package.

The stock traded at its 52 week high ($7.15) on April 4th, 11 days ago. The stock is currently trading at $4.20 (written on April 22). We remind you that Jack and I are amateur investors and do not recommend stocks for purchase. We enjoy researching these stocks for our own pleasure and the benefit of our families.

Reporting a loss in 3rd quarter sales over the same period last year hurt the stock. Bruce Wood explained it this way, “We experienced a modest decrease in third quarter sales over the year-ago period. The reduction is primarily a function of a decline in domestic private label sales, as well as weakness in our Haleko business unit’s. We also experienced a reduction in our gross margin and operating margin percentages. Operating results were negatively impacted by volatile raw material costs in our joint care business, increased marketing spending in support of new products, and disappointing Haleko branded sales.” He goes on to say that he expects higher raw material costs and a challenging competitive environment in Germany to continue. “Nevertheless, we remain committed to a long-term strategy of strengthening our brands in what continues to be a very competitive and compressed margin marketplace, and our strong balance sheet provides us with resources to support this strategy.”

Thankfully, I have not had to use their Joint Care Supplement yet, but after my research and 777,000 hits from my internet on sites that recognized their name, I realize they are one of the most trusted and respected brands due to their focus on research, innovations and delivery of high quality supplements. They emphasize the use of the finest natural ingredients to ensure that its products meet strict standards for labeled potency, purity and stability.

They know growth relies upon sales and sales upon quality product and superior distribution. They have always perceived their customer relationships as huge resources and growth contributors so they will continue to model successful marketing programs to enhance communications and responsiveness to relationships with greater potential.

Bottom Line- Weider Nutrition International is a company worth watching. I keep getting older every day. Can vitamins help me regain my youthful look? You decide.


Comment from Jack: my sister and my basketball team member swears by the combination of Glucosamine and other ingredients. My sister's doctor says that many a joint replacement surgery could be avoided by the regular use of these products. There is also evidence that bone desease is attacking men almost to the degree of women. There are 55 million baby boomers in America. We look for long-term buys and this good be another good one.

STOCK OF THE WEEK: TEAM

TechTeam Global,Inc(TEAM) has been a global provider of Information Technology (IT) and Business Process Outsourcing Support Services (BPOS) to Fortune 1000 corporations, government agencies, and service organizations for over 25 years. Their global locations in the United States, the United Kingdom, Sweden, Germany, Brussels, Romania, and through their wholly owned subsidiaries Digital Support Corporation, TechTeam A.N.E., and TechTeam Cyntergy allow them to continue their commitment of expanding into new markets, delivering new services, and reaching more locations to better serve their global clientele.

TechTeam’s ability to integrate computer services into a flexible-tailored, total single-point-of-contact (SPOC) solution is a key element of its success. Partnerships with some of the world’s "best-in-class" corporations, including automotive, consumer, pharmaceutical, hospitality, insurance, financial services, manufacturing, government, and education provide TechTeam with unparalleled experience and expertise in providing the following IT support solutions: Help Desk / Contact Center Services, Technical Staffing, Professional Services / Systems Integration, Training Programs.

Their mission is to provide develop their approximately 2,000 employees and improve TechTeam’s services in order to deliver results that exceed their customers’ expectations while achieving superior returns for their shareholders.

TechTeam was founded in 1979 in Detroit, Michigan as a value-added reseller and computer training company. As they grew, they added new services, including telephone technical support for Ford Motor Company. Today, headquartered in Southfield, MI, they have over 25 years of experience serving their flagship customer, in addition to serving global companies in business-to-enterprise, business-to-business, and business-to-consumer markets.

At TechTeam Global the employees speak 25+ languages, offering complete multilingual support 24x7. While their customers are in different markets, located in multiple countries, and have varying needs, (TEAM) continues to delivered exceptional services at cost-effective prices that help them reach their business goals.

2004 was a good year for TechTeam ., with record earnings of $.49 Per Share; $.16 Per Share for Fourth Quarter 2004. Today TEAM stock is trading at $11.33. Its 52 week range went from $6.63 on April 22, 2004 to $12.00 on March 8, 2005.

Thus far, 2005 has proven to be a good year for TechTeam. In April Digital Support Corporation (DSC), a wholly owned subsidiary of TEAM, Inc. announced its contract with The United States Air National Guard (ANG) www.ang.af.mil/ has been renewed for 4 1/2 years (6 months’ base period, with 4- 1-year renewal options). If all renewal options are exercised by the ANG, the contract is expected to generate approximately $55 million in revenue. “We are much honored to have been selected to deliver this critical technical support to the Air National Guard,” stated Peter S. Brigham, president and chief executive officer of DSC. “We have been providing support to the ANG since 1998, and this award is an affirmation of the superior work performed by our team, which is distributed over the United States and its territories. As part of TechTeam Global, we remain focused on offering the best value proposition to our customers: exceptional quality, low cost, flexibility and outstanding customer satisfaction.”

March delivered TechTeam a contract with Galaxy Hotel Systems to implement software and deliver training for up to 350 Starwood Hotels. The value of this contract to Team has the potential to reach $2 million in 2005 depending on factors such as the actual deployment and rollout timing. “We required an experienced, skilled technical team to work side-by-side with our IT staff on this complex and mission-critical project,” stated Dan Hogan, Vice President and General Manager of Galaxy Hotel Systems. “With TechTeam'strainers, technology specialists, and coordinators, we are confident that we will be able to achieve our aggressive deployment schedule. They have a proven track-record that we needed to ensure the successful delivery of our solution and they are already exceeding my expectations.”

Tech Team's expertise with information technology and software deployments, combined with our experience serving the hospitality industry, makes this a good fit for both companies,” stated William F. Coyro, Jr., President and Chief Executive Officer of Tech Team's. “We are pleased that Galaxy Hotel Systems, a quality-focused company, has chosen TechTeam’s technology specialists and trainers to partner with them on this important project.”

In January Tech Team'sannounced the acquisition of Sytel, Inc. a diversified IT services and solutions company headquartered in Bethesda, Maryland. This acquisition will further enlarge Tech Team'sprofessional services and systems integration business segment and greatly expand the Company’s government technology systems presence in North America.

I like companies who give back to their community. Tech Team's and their customer Ford Motor Company work with Focus: HOPE, a nationally recognized civil and human rights organization based in Detroit that views education and training as the keys to ending racism and poverty. Its Information Technologies Center provides certified training in network administration as well as desktop and server administration. Together, they have developed a customized program for students who are eligible to be hired by TechTeam to work on the Ford help desk upon graduation. More than 50 people have graduated from this program.

Information Technology (IT) has become the driver for business success. It is vital that the systems work as promised and the business users have reliable support so that their workers can get back to their core business. My research indicates that Tech Team with its roots in technology is a leader in delivering a complete IT service with end-to-end support solution for its global customers! Tech Teamoffers a balance between cost and quality. A balance that seems to appeal to their vendors.

STOCK OF THE WEEK: US Gypsum

Press Release February 2005: Innovative New SECUROCK Brand Roof Board From USG Offers Exceptional Bond Strength and Other Benefits; Experts Confirm New Product Can Enhance Roof Membrane's Performance.

United States Gypsum Company (NYSE: USG) http://www.usg.com/ a leader in building products announced in February the introduction of SECUROCK(TM) http://www.usg.com/securock Brand Roof Board, a distinctive new roof cover board option for low-slope commercial roofing applications. The product's advanced fiber-reinforced technology provides architects, designers, building owners and roofing contractors numerous products with superior performance benefits compared to traditional fiberglass roof boards, whose face layers can de-laminate over time and generate contractor callbacks. Easy to install and handle, the roof board provides outstanding wind uplift performance, fire performance, moisture and mold resistance and versatility.

SECUROCK Roof Board offers architects, designers, building owners, roofing contractors and other construction professionals numerous product and installation advantages - all of which can contribute to a roof's long-term performance.

"Our tests confirm that SECUROCK Roof Board actually enhances bond strength, while providing excellent durability, wind uplift resistance and versatility," said Colin Murphy, president of Exterior Research and Design, http://www.exdesign.com a prominent Seattle consulting firm that conducts forensic analysis, design and testing of building envelope components and systems. "We're also finding that the roof board's unique gypsum fiber technology and uniform composition make it much less likely to de-laminate, which can be an issue with competitive products."

The new product line is Eco-friendly and has earned the "Green Cross" certificate from Scientific Certification Systems (SCS), http://www.scscertified.com/ the nation's leading national testing company that evaluates manufacturers' environmental claims. In addition, the panels are an excellent option in LEED (Leadership in Energy and Environmental Design) hhtp:/www.usgbc.org/LEED/ Green Building Rating System(TM) applications.

For more than 100 years, Chicago-based United States Gypsum Company has been a leader in producing innovative products and systems to build the environments in which we live, work and play. As the inventor of wallboard and ceiling tile, USG created North America's building materials industry. Their products are used in everything from major commercial developments and residential housing to simple home improvement projects. Their flagship brands include SHEETROCK® Brand gypsum panels and DUROCK® Brand cement board, which are recognized around the world.

USG is the world's leading producer of gypsum wallboard, joint compound and a vast array of related products for the construction and remodeling industries. They are also the global leader in the manufacture of ceiling suspension systems and are recognized as the premier acoustical panel and specialty ceiling systems innovator. Their family of products provides creative building solutions that set new standards for productivity and efficiency, helping contractors and architects deliver high quality and innovative designs.

USG, through its subsidiary L&W Supply, is also the nation's largest distributor of drywall and related building products. L&W serves the professional contractor through a network of nearly 200 locations and strives to be their preferred source for all quality products and services they need to complete their projects on time and on budget.

Some 14,000 employees working in more than 30 countries are dedicated to helping their customers and partners achieve success. They strive to reach the highest levels of customer satisfaction and quality in everything they do. Their steadfast commitment to the company's core business beliefs-integrity, safety, performance, quality, diversity, innovation and service-have helped them become the $3 billion Fortune 500 company they are today.

How did they get started?
One hundred years ago, the gypsum business in North America was fragmented into regional markets. Then, in 1902, 30 independent gypsum rock and plaster manufacturing companies merged to form the United States Gypsum Company, consolidating their resources across the continent. The following year, United States Gypsum Company developed its first building product, Pyrobar, a gypsum-based, fireproof tile. The next step toward the wallboard we know today was the invention of Sackett Board, a panel made of multiple layers of plaster and paper. United States Gypsum Company purchased the Sackett Plaster Board Company in 1909, entering the gypsum board market.

The early 1980’s brought recession and devastated USG's bottom line which led to a restructuring of the company. In 1984, USG Corporation was formed as a holding company–a reverse merger in which United States Gypsum Company became one of just nine operating subsidiaries. Through a renewed commitment to research and development and acquisition, USG continued to expand into and lead new markets. DUROCK Cement Board offered new water construction solutions. And the acquisition of DONN Incorporated and its ceiling suspension systems positioned USG Interiors as the only company to offer complete pre-designed and fully integrated ceiling systems.

The early 1990's saw a return to a solid bottom line and continued innovation. A new headquarters building and the USG Interiors Solutions Center, both in downtown Chicago, showcased USG products and innovations. In the late 1990s, USG developed a new gypsum/cellulose product family called FIBEROCK Brand Panels.

What’s Ahead?
By the year 2010, according to some industry experts, significantly more new residential construction will be factory-built. The steadily increasing use of manufactured, modular, and panelized homes means both new challenges and new opportunities for builders. Pinnacle Building Systems of Bristol, Indiana, uses UPG products. Vice President of Manufacturing Pat O’Brien is enthusiastic about both the quality of SHEETROCK Brand Paper Faced Metal Bead and Trim and the service provided by United States Gypsum Company. “We sent one home all the way to Wyoming,” he notes, “and there was only one crack.” He also says that follow-up and monitoring are as important as the quality of the bead. “USG didn’t just sell us the product and walk away,” says O’Brien. “They’ve been there whenever we’ve needed them.”

As USG enters the 21st Century, new markets and opportunities present themselves for expansion and innovation. With the future being shaped by the Internet and e-commerce, new partnerships, and emerging markets, USG goal is to continue to grow and lead the building materials industry. USG maintains one of the largest research and development efforts in the building industry today. The firms laboratory facility (located in the Chicago suburb of Libertyville, IL) is staffed by over 140 employees who bring a wide variety of skills to the task of developing and improving building materials and processes.

It was very interesting touring USG's web site. The renovations and/or new construction USG has been involved in were fascinating. The 105 year old Texas State Capital buildings renovation, the Navy’s new boot camp in Illinois, the 20,000 multifunctional Kiel Center, home of the St. Louis Blues hockey team and my favorite- new schools in South Haven, MS saving money by using abuse-resistant wall panels from USG instead of expensive masonry.

How do you Advertise USG products? NASCAR of course
The 2005 season proves to be an exciting year for USG Racing. USG has joined the #17 DEWALT and Roush Racing team with 2003 NASCAR NEXTEL Cup Series Champion Matt Kenseth behind the wheel. "USG's new NASCAR team program is an alliance of champions," said Julian Francis, Vice President, Marketing, USG Building Systems. "We're affiliated with a championship driver in Matt Kenseth, a championship team in DEWALT Racing, a championship organization in Roush Racing and a championship motor sports sanctioning body in NASCAR. It is only fitting that USG SHEETROCK®, a championship brand in the building industry, has positioned itself with a strategic alliance to target our customers. This is an exciting time for USG Racing and we're looking forward to a thrilling 2005 season."

Financial Outlook
The only loose “board” I could fine in the USG Corporation is when they filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code on June 25, 2001. This action was taken to resolve asbestos claims in a fair and equitable manner, protect the long-term value of the businesses and maintain their market leadership positions.

USG had a 52 week low on 5/10/04 @ $12.30 and a 52 week high on 12/30/04 @ $41.67. Today it trades at $32.11 On February 1, 2005 USG Corporation reported fourth quarter 2004 net sales of $1.2 billion and net earnings of $85 million. Net sales and net earnings increased $242 million and $39 million, respectively, compared with the fourth quarter last year.

As usual the best stock market buys are hard to buy; good buys often have serious flaws. Although the asbestos problem has been around for a long time it is still a present danger. Johns Manville, Owens Corning, Halliburton and many other companies have been damaged by the potential of virtually unlimited law suits.

Bill Frist, Senate Majority Leader, has openly stated that he will get a bill through to "solve" the asbestos problem. Companies such as USG will pay dearly under the planned bill but the good result will be a cap on total liability. It is time for America to get past the drag on our economy created by excessive liability awards. The system has gradually moved to one in which the lawyers get the most benefit, the companies pay dearly and the few who were harmed the worst are lucky to win multi-million dollar awards. All the while, thousands of others who were injured settle for small sums or die before any global solution is found.

Many folks are afraid of the asbestos issue and the possibility that the housing boom is about to bust. The good news for USG is that baby boomers and echo boomers are still buying homes at the same time that industrial building is picking up. The roof panels mentioned in the press release are used in industrial applications. Buy USG as one of a portfolio of 15 stocks or more and sleep well. We will add this stock to our STOCK OF THE WEEK portfolio at tomorrow's opening price.

STOCK OF THE WEEK: RGX Imaging

Chances are you or someone you know has had to have an X-ray, MIR, CT or Ultrasound recently. If you have active children you have probably experienced this thrill too often. Recently, I discovered an 8-year old company in a growth business that fits our "good value" screening criteria. It is a company that is living up to its commitment to provide high quality, cost effective radiology services. Company literature says that Radiologix (RGX) strives to be the premier provider of diagnostic imaging services through high-quality service to patients, referring physicians and mutually beneficial relationships with radiologists who provide expert interpretations of diagnostic images. Through the commitment of valued employees, Radiologix is dedicated to growing shareholder value by delivering personalized, timely and cost-effective services to patients, affiliated physicians, referring physicians, and the health care community.

In November 1997, seven successful, geographically diverse, physician-owned radiology practices joined together to form what is now known as Radiologix. (http://www.radiologix.com/). Each of these physicians contributed their imaging center and administrative assets in exchange for ownership in the Company. The Corporate Office and National Support Center is based in Dallas, TX and provides functional support to the subsidiaries.

Today, Radiologix owns and operates 76 freestanding, outpatient diagnostic imaging centers. The centers employ 2,000 and provide a broad range of diagnostic imaging services in 10 states. The company maintains a strong presence in all of its markets. Thanks to the efforts of their family of employees and member physicians, Radiologix has become one of the leading providers of radiology services in the United States. The company utilizes technology and technical expertise to perform a range of imaging procedures, such as magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), nuclear medicine, ultrasound, mammography, bone densitometry, general radiology and fluoroscopy.

Radiologix’s mission statement is to offer the benefits of small, family type practices, combined with the structure, security and funding of a publicly traded corporation. The radiologist partners work closely with the staff to ensure the highest possible patient care. Management feels it is important to kept the family feeling in the centers while providing "best in class" radiology services.

We have often noted the aging of the "baby boomers". Data show remarkable growth in the number of doctor visits in the USA. US citizens who have reached 51 years of age are taking 7 times the number of prescriptions as they were taking 10 years ago. Health Care is a growth business. Employment for radio-logic technologists is expected to grow most rapidly in offices and clinics of physicians, including diagnostic imaging centers. Health facilities such as Radiologix are expected to grow very rapidly due to the strong shift toward outpatient care, encouraged by third-party payers and made possible by technological advances that permit more procedures to be performed outside the hospital.

Fiscal year end results did not fully reflect the successful year Radiologix had. "2004 was a watershed year for our company. We focused our efforts on stabilizing our operations, building our leadership team, and strengthening our internal controls. As such, we made many difficult operational, financial and personnel decisions that resulted in significant but primarily non-cash financial charges. These decisions challenged our team, tested our resolve, and blurred our true underlying performance," said Sami S. Abbasi, president and chief executive officer of Radiologix. "However, by making these decisions and acting on them, we left 2004 stronger, healthier financially, and better positioned for the future. I am confident in our operations and in our potential to create long-term sustainable shareholder value."

Radiologix’s largest competitors, Alliance Imaging, (AIQ) (http://www.allianceimaging.com/) founded in 1983 has 478 diagnostic imaging systems with over 1,000 clients in 43 states. This stock was volatile during the year. The 52 week low of $3.60 was made on 3-29-04 and the 52 week high of $14.15 was hit 2-1-05, Alliance reported an increase in fourth quarter revenue of 5.5%. Revenue for 2004 increased 4.0%.

Per the Center for Disease Control, (www.cdc.gov/), emergency department visits are on the increase. Two factors are involved: overall population growth and the aging of our population. Older Americans, those 75 years of age and over, had the highest rate of emergency department visits-65 visits per 100 persons per year while the national average was 39 visits per 100 persons per year. You or your family member will likely use diagnostic and imaging services in any 5 year time.

The recent roller coaster ride may have be contributing to the cheapness of the stock. Radiologix’s 52 week high of $4.98 on 2-4-04 and 52 week low of $2.99 on 10-24-04 is too exciting for conservative investors. However, patient investors should be well rewarded by the stock. With a price now of $4.29 per share, are you willing to take a chance on this 8 year old diagnostic imaging company?

STOCK OF THE WEEK: RUSSELL

My family has owned Reebok (RBK) since 1985. The stock has done well and we are in no hurry to sell. However "well" is a relative term.

During the time we owned RBK it has increased in value by 1,100%. When we bought the stock, it looked like a value relative to Nike (NKE); it still does. During the time that we made 1,100%, NKE went up 7,600%! RBK pays a slightly larger dividend than NKE and this dividend is in addition to the capital appreciation. Jeremy Siegel makes the case that dividends add more to the total return than one would think but I doubt that the small dividend difference in these companies is enough to worry over. One lesson to take away is that generally it is best to buy the industry leader.

"Well" really is a relative term. Had we purchased Russell Corp. (RML) on January 2, 1985, our capital capital appreciation would have been 17%; not 17% per year but 17% total since 1985.

Comparing a "t-shirt" maker to Nike is unfair; calling Russell a "t-shirt" maker is unfair; but remember one of our themes is to buy stocks that are "under-loved". We now know that Nike is one of the most successful brands ever. Russell makes quality products and survived a very difficult 20 years in the apparel industry. The comparison of the three companies, shows that investing is an art. Buying good value is always the right approach, but value is a reflection of growth potential, management skill and many other factors.

The following report is about a solid company. A company that is probably a better company than is commonly thought. It does not have the panache of Nike but it is a cheap stock by several measures and we have made it our Stock of the Week.

Russell Corporation has the products to meet the needs of the serious athlete, the weekend warrior and everyone in between. Founded in 1902, The Russell Corporation located in Atlanta, GA. runs every step of the manufacturing process, from weaving raw fibers into fabric to dyeing, cutting, and sewing. RML designs, manufactures and markets a variety of apparel products. These products include fleece, t-shirts, casual shirts, jackets, athletic shorts, socks and camouflage attire for men, women, boys and girls. With eleven brands, Russell Corporation has something for everyone.

The Russell Athletic division is the world's largest supplier of team uniforms and is the Official Uniform Supplier to 14 Major League Baseball(R) teams, Little League Baseball(R), and USA Baseball(TM). Russell outfits over 200 NCAA(R) Division I college teams and is an Official Sponsor of the Women's Basketball Coaches Association (WBCA), the American Baseball Coaches Association (ABCA), and the National Fastpitch Coaches Association (NFCA). Russell apparel can be found in a variety of department stores and sports specialty retailers nationwide.

The JERZEES division is a major supplier of fleecewear and T-shirts to retailers and screen printers. Russell purchased SHC's sporting goods business (Spalding and all other non-golf brands) in May 2003.

The company holds a firm commitment to a very simple philosophy, "do the right things for the right reasons." In today's competitive global marketplace, Russell feels its greatest strength is its people. It employees 14,400.

Russell Corporation supports non-profit organizations with product donations, cash contributions and employee volunteer hours. The company focuses its efforts on programs, projects and activities that benefit the communities where its employees live and work. By working hand-in-hand with the local communities, Russell strives to make a difference in the towns and cities around the world that its employees call home.


Over the last two years, Russell has made the following acquisitions:
* December, 04 acquired Brooke Sports
* July, 04 acquired Huffy Sports
* April, 03 acquired Spalding
* Jan, 03 acquired Bike Athletic

On February 23, 2005 Russell Corporation reported fiscal 2004 fourth quarter sales of $334.0 million, an increase of 10.5% over the same period a year ago; 9.4% for the year. Sales for the quarter ended January 1, 2005, reflect a 3% increase in the Company's ongoing businesses in addition to approximately $22 million dollars in incremental sales from acquisitions owned for less than a year. Sales gains were again recorded for the Activewear Group, the Athletic Group and the International apparel segment.

"During the fourth quarter, sales increases in our domestic segment were led by our Athletic Group. Increases in Athletic were driven by our recent acquisitions, which have solidified and grown our position as a leading branded athletic and sporting goods company. Our International apparel segment continued its sales growth pace, with increases of more than 20% for the quarter and the year," said Jack Ward, chairman and chief executive officer. "For the quarter, our Activewear Group had a 3% increase in revenues, led by our JERZEES(R) sports apparel in the mass channel."

For the full year ending January 1, 2005, net sales increased $112 million to $1.298 billion, a 9.4% increase over the prior year's sales of $1.186 billion.

Those of you who are familiar with Jack Ward, know a fierce competitor. Back in the days when he was at Sara Lee, there was no one in Winston-Salem who garnered more respect. I lost track of Jack some years ago but seeing the number of acquisitions made by Russell in recent years and then reading Jack's name as CEO was a revelation. It made the idea of buying this historically slow growing stock a no brainer.

Russell expects sales for fiscal 2005 to increase approximately 15% to 17%, to approximately $1.50 billion to $1.52 billion.

The 52-wk high (12/28/2004) is $ 19.78 and 52-wk low (5/18/2004) is $ 15.60. The closing on April 27th was $17.70.

We hope you are a disciplined investor. One who diversifies into 12 to 20 stocks, who trades infrequently, who makes his own decisions, who lets winners run and cuts losers short and one who keeps commissions low. AS ALWAYS, WE MAKE NO RECOMMENDATIONS. INVEST AT YOUR OWN RISK!

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STOCK OF THE WEEK: Weider

click here for more information on Weider Nutrition International

Without the necessary vitamins, minerals, and nutrients our bodies fall into a degenerative state, known as aging. You need the necessary amino acids, minerals, proteins, and vitamins to revitalize proper cell regeneration and without them, the body falls faster into disrepair. A little over fifty years ago, Denham Harman, a researcher at the University of California at Berkeley, realized one reason why people get old. Free radicals, molecules that can attack cells, are responsible. He theorized that substances found in our bodies and in food called antioxidants might just slow the damage.

Harman's free radical theory of aging was initially greeted with a mix of apathy and criticism. Industrial chemists had long known about free radical reactions--for example, free radicals make iron rust--but most scientists had doubted that they occurred in living creatures. That was then; this is now. Nutrition.

Today, thousands of studies have corroborated Harman's theory. "Antioxidant" has become a household word, and, according to the Nutrition Business Journal, Americans spend billions of dollars on antioxidants each year. Antioxidants can reduce your risk of heart disease, cancer, and Alzheimer's. They might even increase your life span.

While research shows that exercise and a nutritionally balanced diet can help improve our health, it also shows that our food supply is not what it used to be. Commercial practices such as over-harvesting are thought to contribute to the problem. The considerable evidence shows that supplements can help.

The Nutrition Industry facts reported sales of $63 billion dollars just 2 years ago and they project a steady climb in growth over the next 5 years.

Weider Nutrition International (WNI), located in Salt Lake City, UT develops, manufactures, markets, distributes and sells branded and private label vitamins, nutritional supplements and sports nutrition products. Weider distributes its products to over 60,000 retail locations. Using health food stores, drug stores, supermarkets, gyms and mass volume retailers like Costco and Wal-Mart, which account for about 50% of their sales. Their portfolio of recognized US brands include Schiff®, Weider Sports Nutrition, and Tiger's Milk® Protein Bars.

The Group is organized into three business units: The Schiff Specialty Unit which markets a complete line of specialty supplements, vitamins, and minerals under the Schiff brand as well as private label products. The Active Nutrition Unit develops and markets sports nutrition, nutritional bar and weight management products primarily under Weider and Tiger's Milk brands. Tiger's Milk, introduced in the 1960s, is known as America's first nutrition bar. Last but not least, another division called Haleko develops, manufactures, and markets nutrition products primarily under the Multipower and Multaben brands. Weider operates in the United States, Germany and South America.

History:Joe Weider is credited as the founder of the Sports Nutrition Industry in 1940. The company has a rich history as a leader in the nutritional supplements industry. Weider Nutrition began as the nutritional products division of Weider Health and Fitness. In 1989, Weider Health and Fitness established its three principal business divisions (Sporting Goods, Nutrition and Publications) as independent subsidiaries. The 418,000 square foot Salt Lake City manufacturing facility, opened in 1997, provides Weider with the capacity to quadruple its current annualized sales. In June 1999, Bruce Wood joined Weider as President and Chief Executive Officer. Mr. Wood brings over 25 years of food industry experience, primarily with divisions of Nabisco, Inc.

The Weider Group feels the key to the long-term growth has been the success of core brands. Weider is focused on supporting and building the strongest brands and developing and marketing high quality, innovative new products that meet consumer needs and demands.

As part of brand building and product development efforts Weider announced the sale of certain assets of its Active Nutrition Unit to Weider Global Nutrition, on April 1, 2005. A wholly owned subsidiary of Weider Health, a privately held company in California and the majority stockholder of the company. Bruce Wood, president and CEO, stated, “The sale of the Weider branded business enables us to focus on our core businesses: the Schiff Nutritional Supplements Brand and the Germany based Haleko business.”

Weider knows that anticipating and meeting customer needs is critical. The company has a track record of developing first-to-market products. To continue to seize these opportunities, the R&D and marketing teams are working closely together to develop and carefully test highly-targeted products. Each new product has anticipated measurable return on investment goals.

On November 11, 2004 The Schiff Group introduced a new joint care supplement called Lubriflex3™ that provides fast-acting joint comfort and promotes better joint health. The product’s triple action formula combines Uniflex™, Lubriflex a powerful antioxidant that protects cartilage and joints, with Joint Fluid, a compound that helps joints glide easily and smoothly, and Glucosamine, an ingredient well-known for supporting joint cartilage and maintaining healthy joint function. The net result is a faster-acting supplement that can provide improved flexibility and joint function in just a few days.

By adding Uniflex™ and Joint Fluid to Glucosamine, Schiff® is breaking new ground in the supplement industry. Emerging results from an ongoing study show that in the very first week of use Schiff® Lubriflex3™ was dramatically more effective than Glucosamine alone in improving overall joint function. In fact, 83% percent of users reported that they experienced improved joint comfort. 78% said that they could even function better during daily activities and 72% showed improvement in physical functioning scores.

“The wonderful thing about Lubriflex3™ is that it can do what traditional pain relievers don’t by addressing the root cause of the joint discomfort,” said Luke Bucci, Ph.D., vice president of research for Schiff®. “Glucosamine has earned its reputation as a truly effective supplement when it comes to building joint cartilage. By adding the comforting properties of Uniflex™ and the protective actions of Joint Fluid lubrication to the equation, we’ve found a powerful, faster way to provide joint comfort.” Suggested retail price of $22.99-$25.99 for a 60-count package.

The stock traded at its 52 week high ($7.15) on April 4th, 11 days ago. The stock is currently trading at $4.20 (written on April 22). We remind you that Jack and I are amateur investors and do not recommend stocks for purchase. We enjoy researching these stocks for our own pleasure and the benefit of our families.

Reporting a loss in 3rd quarter sales over the same period last year hurt the stock. Bruce Wood explained it this way, “We experienced a modest decrease in third quarter sales over the year-ago period. The reduction is primarily a function of a decline in domestic private label sales, as well as weakness in our Haleko business unit’s. We also experienced a reduction in our gross margin and operating margin percentages. Operating results were negatively impacted by volatile raw material costs in our joint care business, increased marketing spending in support of new products, and disappointing Haleko branded sales.” He goes on to say that he expects higher raw material costs and a challenging competitive environment in Germany to continue. “Nevertheless, we remain committed to a long-term strategy of strengthening our brands in what continues to be a very competitive and compressed margin marketplace, and our strong balance sheet provides us with resources to support this strategy.”

Thankfully, I have not had to use their Joint Care Supplement yet, but after my research and 777,000 hits from my internet on sites that recognized their name, I realize they are one of the most trusted and respected brands due to their focus on research, innovations and delivery of high quality supplements. They emphasize the use of the finest natural ingredients to ensure that its products meet strict standards for labeled potency, purity and stability.

They know growth relies upon sales and sales upon quality product and superior distribution. They have always perceived their customer relationships as huge resources and growth contributors so they will continue to model successful marketing programs to enhance communications and responsiveness to relationships with greater potential.

Bottom Line- Weider Nutrition International is a company worth watching. I keep getting older every day. Can vitamins help me regain my youthful look? You decide.


Comment from Jack: my sister and my basketball team member swears by the combination of Glucosamine and other ingredients. My sister's doctor says that many a joint replacement surgery could be avoided by the regular use of these products. There is also evidence that bone desease is attacking men almost to the degree of women. There are 55 million baby boomers in America. We look for long-term buys and this good be another good one.

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STOCK OF THE WEEK: TEAM

TechTeam Global,Inc(TEAM) has been a global provider of Information Technology (IT) and Business Process Outsourcing Support Services (BPOS) to Fortune 1000 corporations, government agencies, and service organizations for over 25 years. Their global locations in the United States, the United Kingdom, Sweden, Germany, Brussels, Romania, and through their wholly owned subsidiaries Digital Support Corporation, TechTeam A.N.E., and TechTeam Cyntergy allow them to continue their commitment of expanding into new markets, delivering new services, and reaching more locations to better serve their global clientele.

TechTeam’s ability to integrate computer services into a flexible-tailored, total single-point-of-contact (SPOC) solution is a key element of its success. Partnerships with some of the world’s "best-in-class" corporations, including automotive, consumer, pharmaceutical, hospitality, insurance, financial services, manufacturing, government, and education provide TechTeam with unparalleled experience and expertise in providing the following IT support solutions: Help Desk / Contact Center Services, Technical Staffing, Professional Services / Systems Integration, Training Programs.

Their mission is to provide develop their approximately 2,000 employees and improve TechTeam’s services in order to deliver results that exceed their customers’ expectations while achieving superior returns for their shareholders.

TechTeam was founded in 1979 in Detroit, Michigan as a value-added reseller and computer training company. As they grew, they added new services, including telephone technical support for Ford Motor Company. Today, headquartered in Southfield, MI, they have over 25 years of experience serving their flagship customer, in addition to serving global companies in business-to-enterprise, business-to-business, and business-to-consumer markets.

At TechTeam Global the employees speak 25+ languages, offering complete multilingual support 24x7. While their customers are in different markets, located in multiple countries, and have varying needs, (TEAM) continues to delivered exceptional services at cost-effective prices that help them reach their business goals.

2004 was a good year for TechTeam ., with record earnings of $.49 Per Share; $.16 Per Share for Fourth Quarter 2004. Today TEAM stock is trading at $11.33. Its 52 week range went from $6.63 on April 22, 2004 to $12.00 on March 8, 2005.

Thus far, 2005 has proven to be a good year for TechTeam. In April Digital Support Corporation (DSC), a wholly owned subsidiary of TEAM, Inc. announced its contract with The United States Air National Guard (ANG) www.ang.af.mil/ has been renewed for 4 1/2 years (6 months’ base period, with 4- 1-year renewal options). If all renewal options are exercised by the ANG, the contract is expected to generate approximately $55 million in revenue. “We are much honored to have been selected to deliver this critical technical support to the Air National Guard,” stated Peter S. Brigham, president and chief executive officer of DSC. “We have been providing support to the ANG since 1998, and this award is an affirmation of the superior work performed by our team, which is distributed over the United States and its territories. As part of TechTeam Global, we remain focused on offering the best value proposition to our customers: exceptional quality, low cost, flexibility and outstanding customer satisfaction.”

March delivered TechTeam a contract with Galaxy Hotel Systems to implement software and deliver training for up to 350 Starwood Hotels. The value of this contract to Team has the potential to reach $2 million in 2005 depending on factors such as the actual deployment and rollout timing. “We required an experienced, skilled technical team to work side-by-side with our IT staff on this complex and mission-critical project,” stated Dan Hogan, Vice President and General Manager of Galaxy Hotel Systems. “With TechTeam'strainers, technology specialists, and coordinators, we are confident that we will be able to achieve our aggressive deployment schedule. They have a proven track-record that we needed to ensure the successful delivery of our solution and they are already exceeding my expectations.”

Tech Team's expertise with information technology and software deployments, combined with our experience serving the hospitality industry, makes this a good fit for both companies,” stated William F. Coyro, Jr., President and Chief Executive Officer of Tech Team's. “We are pleased that Galaxy Hotel Systems, a quality-focused company, has chosen TechTeam’s technology specialists and trainers to partner with them on this important project.”

In January Tech Team'sannounced the acquisition of Sytel, Inc. a diversified IT services and solutions company headquartered in Bethesda, Maryland. This acquisition will further enlarge Tech Team'sprofessional services and systems integration business segment and greatly expand the Company’s government technology systems presence in North America.

I like companies who give back to their community. Tech Team's and their customer Ford Motor Company work with Focus: HOPE, a nationally recognized civil and human rights organization based in Detroit that views education and training as the keys to ending racism and poverty. Its Information Technologies Center provides certified training in network administration as well as desktop and server administration. Together, they have developed a customized program for students who are eligible to be hired by TechTeam to work on the Ford help desk upon graduation. More than 50 people have graduated from this program.

Information Technology (IT) has become the driver for business success. It is vital that the systems work as promised and the business users have reliable support so that their workers can get back to their core business. My research indicates that Tech Team with its roots in technology is a leader in delivering a complete IT service with end-to-end support solution for its global customers! Tech Teamoffers a balance between cost and quality. A balance that seems to appeal to their vendors.

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STOCK OF THE WEEK: US Gypsum

Press Release February 2005: Innovative New SECUROCK Brand Roof Board From USG Offers Exceptional Bond Strength and Other Benefits; Experts Confirm New Product Can Enhance Roof Membrane's Performance.

United States Gypsum Company (NYSE: USG) http://www.usg.com/ a leader in building products announced in February the introduction of SECUROCK(TM) http://www.usg.com/securock Brand Roof Board, a distinctive new roof cover board option for low-slope commercial roofing applications. The product's advanced fiber-reinforced technology provides architects, designers, building owners and roofing contractors numerous products with superior performance benefits compared to traditional fiberglass roof boards, whose face layers can de-laminate over time and generate contractor callbacks. Easy to install and handle, the roof board provides outstanding wind uplift performance, fire performance, moisture and mold resistance and versatility.

SECUROCK Roof Board offers architects, designers, building owners, roofing contractors and other construction professionals numerous product and installation advantages - all of which can contribute to a roof's long-term performance.

"Our tests confirm that SECUROCK Roof Board actually enhances bond strength, while providing excellent durability, wind uplift resistance and versatility," said Colin Murphy, president of Exterior Research and Design, http://www.exdesign.com a prominent Seattle consulting firm that conducts forensic analysis, design and testing of building envelope components and systems. "We're also finding that the roof board's unique gypsum fiber technology and uniform composition make it much less likely to de-laminate, which can be an issue with competitive products."

The new product line is Eco-friendly and has earned the "Green Cross" certificate from Scientific Certification Systems (SCS), http://www.scscertified.com/ the nation's leading national testing company that evaluates manufacturers' environmental claims. In addition, the panels are an excellent option in LEED (Leadership in Energy and Environmental Design) hhtp:/www.usgbc.org/LEED/ Green Building Rating System(TM) applications.

For more than 100 years, Chicago-based United States Gypsum Company has been a leader in producing innovative products and systems to build the environments in which we live, work and play. As the inventor of wallboard and ceiling tile, USG created North America's building materials industry. Their products are used in everything from major commercial developments and residential housing to simple home improvement projects. Their flagship brands include SHEETROCK® Brand gypsum panels and DUROCK® Brand cement board, which are recognized around the world.

USG is the world's leading producer of gypsum wallboard, joint compound and a vast array of related products for the construction and remodeling industries. They are also the global leader in the manufacture of ceiling suspension systems and are recognized as the premier acoustical panel and specialty ceiling systems innovator. Their family of products provides creative building solutions that set new standards for productivity and efficiency, helping contractors and architects deliver high quality and innovative designs.

USG, through its subsidiary L&W Supply, is also the nation's largest distributor of drywall and related building products. L&W serves the professional contractor through a network of nearly 200 locations and strives to be their preferred source for all quality products and services they need to complete their projects on time and on budget.

Some 14,000 employees working in more than 30 countries are dedicated to helping their customers and partners achieve success. They strive to reach the highest levels of customer satisfaction and quality in everything they do. Their steadfast commitment to the company's core business beliefs-integrity, safety, performance, quality, diversity, innovation and service-have helped them become the $3 billion Fortune 500 company they are today.

How did they get started?
One hundred years ago, the gypsum business in North America was fragmented into regional markets. Then, in 1902, 30 independent gypsum rock and plaster manufacturing companies merged to form the United States Gypsum Company, consolidating their resources across the continent. The following year, United States Gypsum Company developed its first building product, Pyrobar, a gypsum-based, fireproof tile. The next step toward the wallboard we know today was the invention of Sackett Board, a panel made of multiple layers of plaster and paper. United States Gypsum Company purchased the Sackett Plaster Board Company in 1909, entering the gypsum board market.

The early 1980’s brought recession and devastated USG's bottom line which led to a restructuring of the company. In 1984, USG Corporation was formed as a holding company–a reverse merger in which United States Gypsum Company became one of just nine operating subsidiaries. Through a renewed commitment to research and development and acquisition, USG continued to expand into and lead new markets. DUROCK Cement Board offered new water construction solutions. And the acquisition of DONN Incorporated and its ceiling suspension systems positioned USG Interiors as the only company to offer complete pre-designed and fully integrated ceiling systems.

The early 1990's saw a return to a solid bottom line and continued innovation. A new headquarters building and the USG Interiors Solutions Center, both in downtown Chicago, showcased USG products and innovations. In the late 1990s, USG developed a new gypsum/cellulose product family called FIBEROCK Brand Panels.

What’s Ahead?
By the year 2010, according to some industry experts, significantly more new residential construction will be factory-built. The steadily increasing use of manufactured, modular, and panelized homes means both new challenges and new opportunities for builders. Pinnacle Building Systems of Bristol, Indiana, uses UPG products. Vice President of Manufacturing Pat O’Brien is enthusiastic about both the quality of SHEETROCK Brand Paper Faced Metal Bead and Trim and the service provided by United States Gypsum Company. “We sent one home all the way to Wyoming,” he notes, “and there was only one crack.” He also says that follow-up and monitoring are as important as the quality of the bead. “USG didn’t just sell us the product and walk away,” says O’Brien. “They’ve been there whenever we’ve needed them.”

As USG enters the 21st Century, new markets and opportunities present themselves for expansion and innovation. With the future being shaped by the Internet and e-commerce, new partnerships, and emerging markets, USG goal is to continue to grow and lead the building materials industry. USG maintains one of the largest research and development efforts in the building industry today. The firms laboratory facility (located in the Chicago suburb of Libertyville, IL) is staffed by over 140 employees who bring a wide variety of skills to the task of developing and improving building materials and processes.

It was very interesting touring USG's web site. The renovations and/or new construction USG has been involved in were fascinating. The 105 year old Texas State Capital buildings renovation, the Navy’s new boot camp in Illinois, the 20,000 multifunctional Kiel Center, home of the St. Louis Blues hockey team and my favorite- new schools in South Haven, MS saving money by using abuse-resistant wall panels from USG instead of expensive masonry.

How do you Advertise USG products? NASCAR of course
The 2005 season proves to be an exciting year for USG Racing. USG has joined the #17 DEWALT and Roush Racing team with 2003 NASCAR NEXTEL Cup Series Champion Matt Kenseth behind the wheel. "USG's new NASCAR team program is an alliance of champions," said Julian Francis, Vice President, Marketing, USG Building Systems. "We're affiliated with a championship driver in Matt Kenseth, a championship team in DEWALT Racing, a championship organization in Roush Racing and a championship motor sports sanctioning body in NASCAR. It is only fitting that USG SHEETROCK®, a championship brand in the building industry, has positioned itself with a strategic alliance to target our customers. This is an exciting time for USG Racing and we're looking forward to a thrilling 2005 season."

Financial Outlook
The only loose “board” I could fine in the USG Corporation is when they filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code on June 25, 2001. This action was taken to resolve asbestos claims in a fair and equitable manner, protect the long-term value of the businesses and maintain their market leadership positions.

USG had a 52 week low on 5/10/04 @ $12.30 and a 52 week high on 12/30/04 @ $41.67. Today it trades at $32.11 On February 1, 2005 USG Corporation reported fourth quarter 2004 net sales of $1.2 billion and net earnings of $85 million. Net sales and net earnings increased $242 million and $39 million, respectively, compared with the fourth quarter last year.

As usual the best stock market buys are hard to buy; good buys often have serious flaws. Although the asbestos problem has been around for a long time it is still a present danger. Johns Manville, Owens Corning, Halliburton and many other companies have been damaged by the potential of virtually unlimited law suits.

Bill Frist, Senate Majority Leader, has openly stated that he will get a bill through to "solve" the asbestos problem. Companies such as USG will pay dearly under the planned bill but the good result will be a cap on total liability. It is time for America to get past the drag on our economy created by excessive liability awards. The system has gradually moved to one in which the lawyers get the most benefit, the companies pay dearly and the few who were harmed the worst are lucky to win multi-million dollar awards. All the while, thousands of others who were injured settle for small sums or die before any global solution is found.

Many folks are afraid of the asbestos issue and the possibility that the housing boom is about to bust. The good news for USG is that baby boomers and echo boomers are still buying homes at the same time that industrial building is picking up. The roof panels mentioned in the press release are used in industrial applications. Buy USG as one of a portfolio of 15 stocks or more and sleep well. We will add this stock to our STOCK OF THE WEEK portfolio at tomorrow's opening price.

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STOCK OF THE WEEK: RGX Imaging

Chances are you or someone you know has had to have an X-ray, MIR, CT or Ultrasound recently. If you have active children you have probably experienced this thrill too often. Recently, I discovered an 8-year old company in a growth business that fits our "good value" screening criteria. It is a company that is living up to its commitment to provide high quality, cost effective radiology services. Company literature says that Radiologix (RGX) strives to be the premier provider of diagnostic imaging services through high-quality service to patients, referring physicians and mutually beneficial relationships with radiologists who provide expert interpretations of diagnostic images. Through the commitment of valued employees, Radiologix is dedicated to growing shareholder value by delivering personalized, timely and cost-effective services to patients, affiliated physicians, referring physicians, and the health care community.

In November 1997, seven successful, geographically diverse, physician-owned radiology practices joined together to form what is now known as Radiologix. (http://www.radiologix.com/). Each of these physicians contributed their imaging center and administrative assets in exchange for ownership in the Company. The Corporate Office and National Support Center is based in Dallas, TX and provides functional support to the subsidiaries.

Today, Radiologix owns and operates 76 freestanding, outpatient diagnostic imaging centers. The centers employ 2,000 and provide a broad range of diagnostic imaging services in 10 states. The company maintains a strong presence in all of its markets. Thanks to the efforts of their family of employees and member physicians, Radiologix has become one of the leading providers of radiology services in the United States. The company utilizes technology and technical expertise to perform a range of imaging procedures, such as magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), nuclear medicine, ultrasound, mammography, bone densitometry, general radiology and fluoroscopy.

Radiologix’s mission statement is to offer the benefits of small, family type practices, combined with the structure, security and funding of a publicly traded corporation. The radiologist partners work closely with the staff to ensure the highest possible patient care. Management feels it is important to kept the family feeling in the centers while providing "best in class" radiology services.

We have often noted the aging of the "baby boomers". Data show remarkable growth in the number of doctor visits in the USA. US citizens who have reached 51 years of age are taking 7 times the number of prescriptions as they were taking 10 years ago. Health Care is a growth business. Employment for radio-logic technologists is expected to grow most rapidly in offices and clinics of physicians, including diagnostic imaging centers. Health facilities such as Radiologix are expected to grow very rapidly due to the strong shift toward outpatient care, encouraged by third-party payers and made possible by technological advances that permit more procedures to be performed outside the hospital.

Fiscal year end results did not fully reflect the successful year Radiologix had. "2004 was a watershed year for our company. We focused our efforts on stabilizing our operations, building our leadership team, and strengthening our internal controls. As such, we made many difficult operational, financial and personnel decisions that resulted in significant but primarily non-cash financial charges. These decisions challenged our team, tested our resolve, and blurred our true underlying performance," said Sami S. Abbasi, president and chief executive officer of Radiologix. "However, by making these decisions and acting on them, we left 2004 stronger, healthier financially, and better positioned for the future. I am confident in our operations and in our potential to create long-term sustainable shareholder value."

Radiologix’s largest competitors, Alliance Imaging, (AIQ) (http://www.allianceimaging.com/) founded in 1983 has 478 diagnostic imaging systems with over 1,000 clients in 43 states. This stock was volatile during the year. The 52 week low of $3.60 was made on 3-29-04 and the 52 week high of $14.15 was hit 2-1-05, Alliance reported an increase in fourth quarter revenue of 5.5%. Revenue for 2004 increased 4.0%.

Per the Center for Disease Control, (www.cdc.gov/), emergency department visits are on the increase. Two factors are involved: overall population growth and the aging of our population. Older Americans, those 75 years of age and over, had the highest rate of emergency department visits-65 visits per 100 persons per year while the national average was 39 visits per 100 persons per year. You or your family member will likely use diagnostic and imaging services in any 5 year time.

The recent roller coaster ride may have be contributing to the cheapness of the stock. Radiologix’s 52 week high of $4.98 on 2-4-04 and 52 week low of $2.99 on 10-24-04 is too exciting for conservative investors. However, patient investors should be well rewarded by the stock. With a price now of $4.29 per share, are you willing to take a chance on this 8 year old diagnostic imaging company?

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