JAKKS Pacific, Inc. (JAKK)

End of the day, if your products suck, no one will buy them.

This is a company which has a business model I like, has a solid balance sheet and has consistantly provided solid free cash flow(even ignoring their joint venture). Their outsourced manufacturing replaces fixed costs with variable costs, helping improve profitability during periods of lessened demand. Although I normally would like ownership of intangible property I believe in this instance their strategy of licencing "evergreen" brands(brands which are relatively old, like Pokemon or WWE, whose demand is more stable and less prone to fads) has enabled them to develop a greater portfolio of brands and earn a relatively high ROIC. A good portion of the market cap is in cash and the current price is fairly close to (tangible) book value. Although this company still has a number of risks such as uncertainty in their current joint venture in developing WWE video games and a high conncentration of customers(top 3 customers are roughly 60% of sales), most of this is priced in. I took a small position(~5% of my real portfolio) in this due to its inherent risks but I believe it has significant upside potential.