4 Stocks Under $5 With Upside
PURE Bioscience develops and commercializes bioscience technologies. The company's flagship bioscience technology is an aqueous antimicrobial called silver dihydrogen citrate (SDC). Of the two analysts covering the stock, 50% recommend a buy while the remaining rate holding. As per the consensus estimates of analysts polled by Bloomberg, the stock has an implied upside of 161.2% and is currently trading at $2.01.
Richmont Sciences, PURE's marketing agent, has secured a 10-year, $144 million supply contract from High Scope, a Middle East distributor. The deal's major objective is to bring SDC-based water treatment to the nine Middle East countries. A $355,000 worth product shipment, initially to be used in Dubai as a short trial, launched the 10-year commitment. Meanwhile, High Scope has agreed to buy a minimum $9 million worth SDC in 2011 with annual purchases increasing to $21 million during the tenth year.
The U.S Environmental Protection Agency has approved Pure's SDC as a food-contact surface sanitizer, which opens up new markets. To reduce the threat of bacterial contamination of poultry products, the company is working closely with food microbiologists for testing SDC as a carcass wash. The poultry sector presents a robust growth opportunity and PURE is due to conduct a large study at the University of Georgia, which maintains a facility of almost 9 million chickens.Griffin Securities estimates the company reporting revenue of $1.9 million in the household product line, $752,000 in personal care and $500,000 in agriculture. Heading into 2012, revenue from these segments is likely to increase more than 90% from the 2011 levels.
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