Buy the auditors

Before you jump to conclusions the title doesn't say "Buy-off the auditors". You need to read more carefully. We are in a recession and many businesses are about to run out of cash. There is a big difference between having a passionate business idea and actually running a business. The reasons most businesses fold -- and guess what -- the majority do -- is not that they had a bad product or didn't know their market; it's because of poor business practices.

PRG-Schultz International, Inc. is a leading provider of accounts payable and other recovery audit services to large and mid-size businesses and certain governmental agencies having numerous payment transactions with many vendors. The company has four distinct operating segments consisting of Accounts Payable Services, Freight Services, Tax Services and Facilities Services. Each segment represents a strategic business unit that offers a different type of recovery audit service.

PRGX makes sure you get what you pay for. They audit bills and contracts and give you assistance to manage your accounts receivable and payable. Most business owners fail miserably in these basic areas.

Barchart shows this stock has had price appreciation on 15 of the last 20 trading sessions and 4 of 5 recently. It has had a nice 34.44% price appreciation in the last 65 days.

This stock is not closely followed on Wall Street but analysts expect an annual growth rate of 20% for the next 5 years.

On other sites Wall Street Survivor readers give the stock a 5/5 Survivor Sentiment rating plus a 5/5 technical and a 5/5 fundamental rating. Over on Motley Fool the CAPS members think the stock will out perform the market 157 to 12 with the All Stars in agreement 60 to 2.

This stock has what I look for:

• Hitting new highs in more than 50% of the recent trading sessions
• If followed by Wall street positive outlook with no trash talking
• Confirmation of my research on other major sites.

Recommendation: Credit will continue to be tight. Bankers will only lend to businesses that are run like businesses. A firm hand shake and looking someone straight in the eye won't cut it in today's business environment. I'm adding PRGX to my more speculative Marketocracy model portfolio VMSLO at around 6.25 with a stop loss at 5.50. This is a highly speculative purchase because of low price and low volume. Take your stop loss seriously.

Jim Van Meerten is an investor who writes on financial matters here and on Financial Tides. Please leave a comment below or email JimVanMeerten@gmail.com

Disclosure: No positions in PRGX at the time of publication