Last November, I announced my intention to create a portfolio of 10 companies that investors had effectively thrown away and given up on, in the hope of showing that deep-value investing, and contrarian thinking, can actually be a very successful investing method. I dubbed this the "One Person's Trash Is Another Person's Treasure" portfolio and, over a 10-week span, I highlighted companies that I thought fit this bill, and would expect to drastically outperform the benchmark S&P 500 over the coming 12 months. If you're interested in the reasoning behind why I chose these companies, then I encourage you to review my synopsis of each portfolio selection:

Now, let's get to the portfolio and see how it fared this week:

Company

Cost Basis

Shares

Total Value

Return

Exelon

$31.25

31.68

$968.46

(2.2%)

QLogic

$11.46

86.39

$924.37

(6.6%)

Dendreon

$5.97

165.82

$742.87

(25%)

Dell

$13.37

74.05

$987.09

(0.3%)

Staples

$13.48

73.44

$1,201.48

21.4%

Arkansas Best

$10.83

91.41

$2,134.42

115.6%

Arch Coal

$7.03

140.83

$556.28

(43.8%)

Skullcandy

$6.71

147.54

$815.90

(17.6%)

Orange

$11.64

85.05

$803.72

(18.8%)

Xerox

$8.16

121.32

$1,164.67

17.6%

Cash

   

$0.06

 

Dividends receivable

   

$84.53

 

Total commission

   

($100.00)

 

Original investment

   

$10,000.00

 

Total portfolio value

   

$10,383.85

3.8%

S&P 500 performance

     

10%

Performance relative to S&P 500

     

(6.2%)

Source: Yahoo! Finance.

This week's winner
Topping the list this week was the portfolios worst performer up until now, Arch Coal (NYSE:ACI), which logged a 6.2% gain despite continued negativity surrounding coal. One factor still working in coal's favor is that it still accounts for better than 40% of all electricity generation in the U.S. It isn't a fuel source that's going to disappear overnight no matter how popular alternative energy is becoming. As long as Arch continues to focus on improving its exports business, I feel it has the tools necessary to cut costs and wait for prices to improve.

This week's loser
You know it's been a good week when the worst performing stock was Dell (UNKNOWN:DELL.DL)... and it rose by 0.2% on the week! That's right; all 10 stocks were up this past week. The reason Dell didn't join in on the fun nearly as much as the other companies here is that ISS Group backed Michael Dell and Silver Lake Partners $13.65/share bid. Carl Icahn has proposed numerous methods of increasing value for Dell shareholders, but it appears he is going to be blocked, yet again. The July 18 vote on the Silver Lake buyout is going to be crucial, so keep your eyes peeled.

Also in the news...
Electric utility Exelon (NYSE:EXC) received a bit of good news yesterday after Reuters reported that nuclear outages had hit a nearly two-year low. Exelon is the largest operator of nuclear power plants in the U.S., so this is positive news, and could signal that its pricing power (at least with regard to nuclear) is improving. Exelon still has plenty of challenges ahead, including the assimilation of diverse alternative energies like wind and solar into its energy portfolio, but it also looks brutally undervalued at these levels.

Office supply superstore Staples (NASDAQ:SPLS) should be licking its chops with excitement as OfficeMax shareholders approved the pending merger with purchasing company Office Depot. Some may see this new company as fierce competition. As for me, I see it as a two-year opportunity for Staples to pick up displaced customers from store closures caused by this merger, and as a way of solidifying its brand name. Staples has a shot at really surprising Wall Street over the coming year or two.

To add to last week's "by the way" moment, have you been noticing the steady rally in QLogic (NASDAQ:QLGC) shares over the past week? Shares of peer Emulex soared on takeover chatter, but the true takeover attention may turn to QLogic, which offers more cash per share and, frankly, has better long-term growth potential -- although, keep in mind that I own shares and am thus biased. With wireless service providers spending like there's no tomorrow, we're beginning to see cash trickle down to fiber-optic products suppliers. It's only a matter of time before equipment makers like QLogic get their turn. I really like this space to surprise to the upside over the next four-to-six quarters.

We can do better
It was another solid week of gains for this contrarian and deeply discounted portfolio, which ever-so-slightly outperformed the S&P 500. Still, we have a long way to go to catch the broad-based index. Luckily, this isn't a sprint, it's a marathon; and these businesses are set up to succeed over the long run. I suspect this portfolio will gain significant momentum before the year is out.

Check back next week for the latest update on this portfolio and its 10 components.

Fool contributor Sean Williams  owns shares of QLogic, Dell, Skullcandy, and Orange, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

The Motley Fool owns shares of Dendreon, Skullcandy, and Staples. It also recommends Exelon and Orange. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.