A portfolio of 8 stock picks from the edge

Over the weekend R.H. Donnelley was featured in a Barron’s article. The article outlines some of the obstacles which have weighed on the stock, but provides a measure of optimism saying that the stock is a “risky but attractive” way to bet on the continued viability of the yellow pages. The stock responded by rising over 15% today.

I selected RHD for the 8 Stock Portfolio when it was $1.47 per share. After today’s move it is up 49%, making it the top performer in the portfolio.

Some interesting points from the article:

• RHD is the third largest Yellow Pages publisher behind AT&T and Idearc (Verizon spin off).
• RHD debt trades for 50 cents on the dollar, providing a yield of over 25%.
• The company has $9.7 billion in net debt.
• The company predicts 2008 cash flow of $475 to $525 million.
• The first major debt maturity of $1.4 billion will take place in 2010.