S.A. Advisory E-Mail Update

The Death of Equities or the Opportunity of a Lifetime
We at www.saadvisory.com are not sure if Hell is worse than this current market?

October 26, 2008

Please review 12 stocks that we feel are super cheap and have the potential to return large gains during the next 12 months! This financial meltdown has cause hedge funds, mutual funds, institutions and regular investor types to sell because of margin calls, redemption and plain vanilla PANIC!

Oct 26, 2008 An interesting note: Our stock pick of the year for 2008 has turned out to be one of our stellar performers that continues to appreciate in this 100 year storm of wealth destruction- We first recommended ADG on or about Sept 03, 2007 @ $4.50- then proceeded on January 1, 2008 we named ADG as our "stock pick of 2008" ( $5.77) currently ADG traded at $8.00 a few day ago-now trades at $7.00- still a 36% & 18% gain respectfully! Even if the world is imploding and economies are sinking into a big black hole-- it still appears that military gear is still in great demand- We remain very Bullish on the group and you will find another military speculation within our current list of fire sale bargain basement distressed severely fundamentally undervalued stocks that in our opinion should be purchased!

We know the pain from this current market rout and actually are not sure if it is nearing a bottom but at the rate of collapse that the Dow and NASDAQ are experiencing we only have around 1 month or so until the indexes reach Zero!

These are 12 stocks that we believe can help us regain some of our financial wealth that has evaporated during the past year and especially during the past 2 months. Many of the mentioned stocks have fallen 60-70% from Oct 1, 2008- A wealth implosion that is a once in a century event! We much remain calm and positive and stop listening to the chaos that is being spread by the talking heads and print media- focus on discounted value and realize that the herd is always wrong!!

Please review our 12 stock picks:
  1. Alcoa (AA) $9.41- Not seen at this level since May 1994- book value $18.75 $1/sh in cash downgraded earnings for 09 to $2.00/sh - est. PE of 4.7X. October 1, 2008 stock was $21.27, PSR= .27-- largest aluminum company in the US. A jewel of the free world!! 52 week range- $9.05-$44.77

  2. Tesoro Corp. (TSO) $8.98 One of top three refiner's in the US. Not this low since Feb 2004. Book value around $21.50 -est. earnings for 09 $1.70 or a PE est. of 5.2X. Never going to use gasoline, diesel, heating oil or jet fuel again- Oct 1, 2008 stock was $16.28 current PSR .05 - 52 week range $7.61-$65.98

  3. Graftech International Ltd (GTI) $6.21. Largest manufacturer and provider of high quality natural and synthetic-graphite and carbon -based products and services. Has not been this low since Oct 2006. Oct 1 2008 GTI was $14.01, BK $4.25, PSR= .70, earnings are upgraded for 09 to average $2.55 or 2.4X- They own the market. 52 wk range $5.25-$28.00

  4. Steel Dynamics (STLD) $9.59 Premiere steel manufacturer. Oct 1 2008 stock traded @ $15.92- Sept 1 2008 stock traded @ $22.61. PSR=.21, Book value $9.50, earnings downgraded for 09 to $3.00/sh- PE est. of 3.19X-- Huge insider buying Oct 16-17 2008. Current low not since Jan 2006. 52 week range $6.86-$40.92. "A steal of a deal for steel"

  5. Greenbrier Companies (GBX) $8.35 Railroad freightcar and equipment in North America and Europe. Oct 1, 2008 stock was $19.48, current PSR=.12. book value $15.32 - heavy fund selling- most likely due to need of cash from margin calls. Earnings est. of $2.06 for fiscal 09 ending August resulting in est. PE of 4.05X. Not this low since April 2003. 52 week range $8.01- $29.52

  6. Manitowoc Co. (MTW) $8.94 Manufacturer of Cranes, food service equipment & Marine vessels. PSR=.28, Book value $12.60, cash/sh $3.21. Heavy hedge fund selling. Oct 1, 2008 stock price was $15.54. Has not been this low since Sept 2004. Earnings est. for 09 of $3.67 or PE est. of 2.4x. 52 week range $8.17-$51.49

  7. Hercules Offshore (HERO) $5.56. Leader of offshore contract Drilling, liftboat and inland barge services with operations in 10 countries on 4 continents. Hero's fleet of jackup rigs is the fourth largest in the world and largest in the US Gulf. Bk $22.74, PSR=.55, Earnings est. lowered dramatically to $2.25 for 09 or PE est. of 2.47X-- Oct 1, 2008 stock traded @ $13.93, cash/sh $1.11--Never been this low since IPO Jan 2005 $21.90. 52 week range $5.29- $39.47

  8. Western Asset High Income Opportunity Fund. ($3.73) Closed end fund invests only in High Yielding corporate debt obligations--No Leverage -- been around from at least 95. Current yield is 16% & pays monthly- current rate is .05/month ( can change every 3 months) NAV ( net asset value) is $4.54. Current share price is an 18% discount to NAV. Oct 1, 2008 HIO was trading @ $4.37--Sept 1, 2008 HIO was trading @ $5.28. Strong share appreciation potential while we wait we get 16%

  9. Yamana Gold, Inc. (AUY) $4.03 Gold producer. Book value $8.77, PSR= 2.42, est. EPS for 09 .78 or PE est. of 5.16X. Oct 1, 2008 share price $8.75 ( gold was 837/oz). Last time AUY was $4.03 gold was $480/oz during November 2005. First time gold hit 738/oz was Oct 2007 and stock price was $13.62! Markets are wacky-- AUY in our opinion is super cheap- must own at least 1 gold producer in diverse portfolio. 52 wk range $3.31 -$19.93

  10. Asia Pacific Wire & Cable (AWRCF.OB) $1.15 Leading manufacturer of wire and cable products for teleco, power and enameled wire industries in select markets in the Asia Pacific region. We recommended AWRCF.OB 1 1/2 years ago @ $1.00- has been as high as $6.50 during 2008. 13.8 million shares outstanding, rev for 6 months ending June 30th $252 million and net income/sh of .13, cash/sh $3.85, stated BK $10.00 ( does not include updated values for land and buildings- could easily add a few more $$'s to stated bk) . Rev for 2008 will reach around $500 million and net of .26. PSR est. .03, PE est. of 4.4X , trading a 1/10th of book and 1/3rd of cash- major exchange listing is anticipated according to management's plan.

  11. Pride Business Development Holdings (PDVG.PK) .15 An unknown sleeper with extra huge upside potential during the next 3 to 12 months. A military play that has players from top tier lobby firms located in Washington DC feeding business to newly formed sub of Pride. Recently announced a $278 million 10 year contract with Pride to construct naval vessels with stealth material for insulation and heat shielding characteristics. Mr Landrem, Chairman of PDVG.PK is well connected to the Military Industrial Complex and we believe that during the next few weeks additional contracts will be released. The company is actively updating its financials and intends to become fully reporting with the SEC near term and release completed 8k filings outlining the business plan for 09's meteoric revenue growth and earnings. At present around 50 million shares are outstanding and fully diluted. Whether we are in a severe or mild economic downturn the military complex is usually shielded. Great speculation for troubling times with the potential of extra ordinary returns. Attractive $28 million NOL should not be overlooked- will shield federal tax liability for a few years.

  12. Moore-Handley ( MHCO.pk) $1.05 Regional distributor of hardware and home center products. Rev for 3rd Q reached $40 million and net of .04. For the 9 months ending Sept 08 rev reached $118 million and posted a .08 loss. At present there are only 1.6 million shares outstanding with a stated book value of $6.22/sh ( does not take into account the large land horde that surrounds the center that adds a few more dollars to the stated bk). If you are not buy a new house for a very long time you must maintain the older house, which is good for MHCO.pk. Currently trading at less than 1/6 stated bk, PSR of .01 and we anticipate that margins will recover for 09 as well as share price--perfect takeover candidate at current levels--The whole company is being valued at $1.6 million and rev for the year will reach $160 million. 52 week range $1.05-$4.80
We have not been paid by any of the listed investments within this email alert. We may buy, sell and or hold at our discretion.

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