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Being somewhat of a contrarian investor I am always on the lookout for stocks that are underperforming analyst expectations and price targets, are flush with cash, and have good growth prospects. Let's take a closer look at four stocks I have identified that meet those criteria.

1) BG Medicine Inc. (BGMD)

SectorHealthcare
Market Cap$64.65M
Cash Per Share$1.13
Price Per Share (10/8/12)$3.21
Mean Analyst Price Target$11.13
Mean Analyst Recommendation (Strong Buy 1 - 5 Sell)1.4

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Business Summary From Yahoo Finance:

BG Medicine, Inc., a life sciences company, engages in the discovery, development, and commercialization of novel cardiovascular diagnostics to address unmet medical needs. The company was formerly known as Beyond Genomics, Inc. and changed its name to BG Medicine, Inc. in October 2004. BG Medicine, Inc. was founded in 2000 and is headquartered in Waltham, Massachusetts. The company markets the BGM Galectin-3, a diagnostic test for measuring galectin-3 levels in blood plasma or serum for use in patients with heart failure through regional and national laboratory testing facilities and directly to hospitals and clinics in the United States, as well as through distributors in certain countries in Europe. It is also developing CardioSCORE, a cardiovascular diagnostic test designed to identify individuals at high risk for near term cardiovascular events, such as heart attack and stroke; and galectin-3 test for a second indication to identify individuals at risk for developing heart failure, such as patients who have suffered a heart attack, as well as patients suffering from hypertension or diabetes.

My Commentary

BG Medicine shares have been in a tailspin the last 3 months mainly due to reporting a $6.1M increased net loss for the 1H 2012 compared to 1H 2011 and not meeting an FDA August 15th deadline for a complete response regarding the company's CardioSCORE TM test 510(k) submission. The company plans to submit the data at a later date to be determined. BGMD has recently announced key additions to the management team and a Mizuho analyst recently initiated a "buy" on the stock with a $6 price target. The company also has upcoming catalysts including expected new distribution agreements to launch its BGM Galectin-3 test in additional important markets throughout the world. The stock currently trades at a 52 week low of $3.21 and has $1.13 in cash per share. With a mean analyst price target of $11.13, Wall Street believes BGMD has plenty of room to run.

2) Lattice Semiconductor Corp (LSCC)

SectorTechnology
Market Cap$442.4M
Cash Per Share$1.57
Price Per Share (10/8/12)$3.77
Mean Analyst Price Target$5.29
Mean Analyst Recommendation (Strong Buy 1 - 5 Sell)2.0

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Business Summary From Yahoo Finance:

Lattice Semiconductor Corporation designs, develops, manufactures, and markets programmable logic products and related software. The company offers field programmable gate array (FPGA) products, including LatticeECP products for deployment in wireless infrastructure and wireline access equipment, as well as in video and imaging applications; and LatticeXP products for the security, surveillance, and display markets. It primarily serves original equipment manufacturers in the communications, computing, consumer, industrial, military, automotive, and medical end markets. The company sells its products in the United States, China, Europe, Japan, Taiwan, rest of Asia, and rest of the Americas. Lattice Semiconductor Corporation was founded in 1983 and is headquartered in Hillsboro, Oregon.

My Commentary

Lattice shares were trading at $7 per share in February of 2012 and have since been cut in half mainly due to Q2 revenues being socked by European spending cuts. The company initiated a 20M share repurchase program in February of 2012. The company is in a great position to ride out the macroeconomic conditions and due to its strong balance sheet could be a potential takeover target by a competitor such as Xilinx (XLNX) or Altera (ALTR) - both large players in the programmable logic space. The shares are currently trading at $3.77 while the company has $1.57 per share in cash. With a mean analyst price target of $5.29, Wall Street believes Lattice has plenty of room to run.

3) Astex Pharmaceuticals, Inc. (ASTX)

SectorHealthcare
Market Cap$267.7M
Cash Per Share$1.28
Price Per Share (10/8/12)$2.87
Mean Analyst Target Price$4.25
Mean Analyst Recommendation (Strong Buy 1 - 5 Sell)1.5

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Business Summary From Yahoo Finance:

Astex Pharmaceuticals, Inc. engages in the discovery and development of small molecule therapeutics with a focus on oncology and hematology. It develops small molecule therapeutics using its fragment-based drug discovery platform, Pyramid. The company was formerly known as SuperGen, Inc. and changed its name to Astex Pharmaceuticals, Inc. in September 2011. The company was founded in 1991 and is headquartered in Dublin, California.

My Commentary

Astex's shares took a hit at the end of September when it announced it was discontinuing its phase II study of amuvatinib for lung cancer. The good news is Astex has a deep pipeline with several drug candidates in various phases of clinical testing and several partnerships with large pharmas. With so many upcoming "shots on goal" for Astex the future looks bright and the shares shouldn't stay down for long. Astex shares are currently trading at $2.87 while the company has $1.28 per share in cash. With a mean analyst price target of $4.25, Wall Street believes Astex has more room to run.

4) Thompson Creek Metals Company Inc. (TC)

SectorBasic Materials
Market Cap$431.9M
Cash Per Share$2.43
Price Per Share (10/8/12)$2.56
Mean Analyst Target Price$4.91
Mean Analyst Recommendation (Strong Buy 1 - 5 Sell)2.3

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Business Summary From Yahoo Finance:

Thompson Creek Metals Company Inc. engages in mining, milling, processing, and marketing of molybdenum products in the United States and Canada. As of December 31, 2011, its consolidated proven and probable reserves totaled 448.8 million pounds of contained molybdenum in the Thompson Creek Mine and the Endako Mine. The company was formerly known as Blue Pearl Mining Ltd. and changed its name to Thompson Creek Metals Company Inc. in May 2007. Thompson Creek Metals Company Inc. is based in Denver, Colorado.

My Commentary

Thompson Creek shares have suffered mainly due to higher reported losses at two of its mines, reduced ore output, and slumping molybdenum (rare-earth) prices. The good news is Thompson Creek recently initiated cost-cutting programs and it does sit on large addressable reserves of gold, copper, and molybdenum. The shares have a taken a beating in 2012 - currently trading at $2.56 down from over $9 per share in February while the company has $2.43 in per share in cash. With a mean analyst price target of $4.91, Wall Street believes Thompson Creek has plenty more room to run.

Financial information and graphs sourced from FinViz and Yahoo Finance.

Source: 4 Undervalued Cash-Heavy Stocks With Room To Run Higher

Additional disclosure: This article is informational and intended to spur thought and discussion. This article is not a substitute for your own extensive due diligence and does not qualify as investment advice. Do not buy or sell stocks based on this article. I do not short stocks nor do I invest in options.