Fountain Powerboat Goes Vroom!

During the U.S. assault on Iraq in 1991, the first wave of amphibious 33-foot "Rambo" boats to hit the Persian Gulf was made by Fountain Powerboat Industries (FPWR ). Although the leisure-boat market is its biggest draw, Fountain is a steady supplier of high-powered, high-speed boats to the U.S. government, mainly the Navy Seals, the Coast Guard, and federal law-enforcement agencies. Former President George H.W. Bush bought one after the Persian Gulf War, says Chairman Reginald Fountain Jr., who is seeking new business from Homeland Security, including the Coast Guard, to upgrade its existing fleet. Peter Cardillo, managing partner at Global Partners Securities, who bought shares, is betting that Fountain will win new orders from Homeland Security to help tighten controls at seaports. He figures the stock, now trading at 2.90, is a cheap investment that could double in 12 months, based on his earnings estimate of 35 cents a share in fiscal 2003 ended June 3, and 55 cents to 60 cents in fiscal 2004, compared with Zachs Investment Research's consensus numbers of 26 cents and 58 cents, respectively.

Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.

By Gene G. Marcial

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