Editor’s Note: While Sam Collins is on vacation, we’ve asked Nick Atkeson and Andrew Houghton, editors of Big Money Options, to provide you with a trade of interest until Sam returns June 1.

Novell Inc. (NOVL) — This is a high-quality, cash-flow-positive software company that has been almost forgotten in this two-month market rally.

In the past, the company has struggled against Microsoft. Today, the company has a new management team that has been in place for about a year, $3 per share of cash, positive cash flow and no debt. The stock is currently trading at about $4.

Analyst estimates for this fiscal year and next are 26 cents and 30 cents respectively. That translates into a P/E multiple of less than two-times, if you account for the cash on the balance sheet.

Our background checks indicate that the company’s solid financial condition shouldn’t change materially during the next six to 12 months. This is the kind of stock that could double during the next couple of years as it survives the recession and prospers during the recovery.

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Sam Collins is a registered, fee-based portfolio manager who may be contacted samailc@cox.net. You can also check out an archive of some of his most recent market outlooks by clicking here.