I would advise against buying NUAN shares. Just take a peek at their balance sheet. It seems to be a struggling company with no real justification for its recent strong showing. I advise shorting it. In the quarter ending December, 2005, NUAN ended with a loss of 4.9 million dollars. It has negative EPS. Sure, it's revenue has increased every year, but it seems to me that the balance sheet and income statements suggest that the company is struggling. It is advisable to steer clear of companies that don't make any profit. The price/sales value is also grossly high. Enterprise value/EBIDTA is way too high, with a whopping 62.03. Furthermore, the book value is at 3 dollars. Price per book is at 2.85, which is not that good either. Return on Assets is way low, and Return on Equity is negative. Forward P/E is at 22, which is high as well. Overall this seems to be a growth stock with some momentum because it filed a lawsuit recently. This company is very risky. I say sell the company as soon as its momentum starts receding. This stock could go on a downward spiral very quickly. The company is near its 52 wk high. What goes up must come down. The reason the value went up was because they announced a LAWSUIT on friday. Surely, it can't keep the momentum going. Remember, the value was at $9 approximately(on Thursday) before the lawsuit announcement. This would be the worst time to buy this company's shares. Nobody can predict the outcome of a lawsuit. Everybody thought OJ was guilty. I used the same criteria for judging SIRIUS. On Friday, we came to know that Sirius's loss has widened. The company decided to pay $100 million a year to HOWARD STERN. How on earth can that pay him? Furthermore, SIRIUS also gave Howard bonuses lately (worth millions) in the form of shares. This company is risky. Their loss was 311 million last quarter, hardly pocket change. I use the 7% cutoff point. Don't keep the stock if the loss is more than 7%. Dump it and buy shares of a more promising company. Here is a list of companies I find promising. Let me know what you all think: SKM HOV DHI TLB LIZ HMA SPF Please critique my portfolio. How would you rate them? But I have become disenchanted with the stock market lately. Index fund might be a better idea. 10% annual return(with an occasional negative return) might not be a lot, but over the course of 30 years, you have tripled your value, without taking compounding into account.