'Doubling Stocks' Pick Up 37.03% in Two Days

Editor's note: Just two days after "Doubling Stocks" editor Michael Cohen announced his latest stock pick -- i.e., Rudy Nutrition [RUNU.PK] -- the stock rose a whopping 37.03%. Last evening [03/26/2008], just after the trading markets closed, here's what Cohen reported to his subscribers:

By Michael Cohen
Editor, "Doubling Stocks"

Since I picked RUNU [Rudy Nutrition] as a company to write this week's report on... The stock [as predicted] has risen 37.03% [from $0.81 to $1.11].

Just to bring this down to earth, had you invested $10,000 in RUNU when I sent the e-mail... You'd now have roughly a $3,500 profit [taking account of trading fees].

And, though I call this newsletter "Doubling Stocks," trust me, a 37.03% gain in a matter of days... is nothing to sneeze at. It's more than the yearly gain of legendary investor Warren Buffet... who, in his prime, produced 28% a year.

Just think... That kind of profit could buy a European holiday for the family -- or, maybe, 12 months' worth of payments on a new car...

And for what? Reading your e-mail of an evening, and spending an hour or so researching stocks I write about in order to make sure it really is, in your eyes, a sound investment.

In my opinion -- especially in the doom and gloom of the coming recession -- penny stocks are the only place where these kind of profits are doable... on a WEEKLY basis!

If you did take profit on RUNU... congratulations. But...

If you did decide to invest in RUNU and have not yet taken profit... then I think that is a wise move. In my opinion, this stock will continue to rise over the next few days -- possibly, to around $1.50.

And from RUNU's close today of $1.10, I still think the stock is a bargain at that price.

Here's why: If you had been watching RUNU this week, you must have realized that the stock has been propelled to these levels by the very promising and interesting news that has been released.

[See: http://finance.yahoo.com/q?s=RUNU.PK]

In the report I sent you about Rudy, I said how the main reason drink [and other perishable food-goods] companies fail, is
because of distribution. These goods have a very limited life -- from the day they are produced, to the date they must be sold by.

And, truth be told, I usually avoid food-stuff companies for this very problem: A distribution network is expensive and complex to set up -- unlike their competitors, such as Coca-Cola, who can use one of the largest international distribution networks in the world... These smaller companies start with nothing, and they start their business with a huge setback from the get-go.

Not only that, but a small distribution network comes coupled with another problem...

We are all brand junkies. We buy Coca-Cola over Pepsi. We rent cars from Hertz, instead of Avis. And this is not because one offers better service than another, or because one tastes better [though my daughter would beg to differ]... It is simply because one has a much larger advertising budget.

And, if we analyze that further... Let's imagine "Ma & Pa Drinks Co." is pitting itself against the mighty Coca-Cola. Ma & Pa knows that, to sell any drinks whatsoever, they need to advertise. The obvious problem is, they don't have as big a budget as Coca-Cola. But not only that -- and here's where distribution comes in -- they cannot run a large-scale television campaign, as they could only manage to get distribution in seven [7] of the 50 U.S. states.

In addition, while Coca-Cola can divide their multibillion-dollar ad budget by billions and billions of cans of cola, Ma & Pa Drinks Co. has no such luck. Meaning the advertising expense to Coca-Cola may be just $0.02 per can, while a good ad campaign could double the per-item cost for Ma & Pa Drinks Co.

Now, this little story may have bored you, but, trust me, it has a part in why I initially chose Rudy Nutrition. You see, first of all, a new drinks company must meet the distribution problem. But, as I told you in the initial report, Rudy already has distribution agreements with the leading specialty drink distributors in the USA.

So... During my analysis, I ruled this out as a possible flaw in the business.

But, in addition, over the past few days, news has been released by the company that they have expanded the distribution network even further -- a big step forward for a company in this industry.

Secondly, as I just said, the small drinks companies come up against the problem of high per-unit advertising costs. What solution can there be to this problem?

It's quite obvious. Rudy Nutrition is backed by the famous Rudy Ruettiger. And this isn't some weak endorsement; he owns the company. So, he is hauling ass [to use a crude phrase] to get this company known, and he's doing this without being paid -- and without spending the company's money.

In fact... news released also confirmed this: "Daniel 'Rudy' Ruettiger & Rudy Nutrition, Inc. Make Noteworthy Appearance at the National Automatic Merchandising Association Spring Expo"

In addition, because of his celebrity status, and because it is his name used to sell the drink... Tests have shown it to outsell POWERade and Gatorade when pitted against each other... without the million-dollar advertising expenses! Just another reason why having this as "Rudy's Drink" is a great great asset to the company.

What I have mentioned thus far are the major reasons drinks companies fail. And I've also explained why I believe Rudy will not -- specifically, due to these excellent competitive advantages the company has over the competition.

And, during the current drive of the company, for more exposure -- both to investors and to consumers -- I believe these points will be taken account of... and the price will rise even further, to around $1.50.

Best Regards,

Michael Cohen
____________________

FREE "Penny Stock Bible" reveals two simple rules for discovering hot and profitable trades that'll likely double within 23 minutes of the market's opening.