9 Cash Heavy Small Caps With Analyst Confidence

by: ZetaKap

Are you a growth investor interested in smaller companies that could potentially make huge strides in the coming years? Today we focused on small cap companies holding substantial amounts of cash. Having cash on hand allows a company to make strategic investments, acquisitions, or plow money into R & D that could potentially launch the company into the stratosphere. We focused in further on companies that analysts have rated as 'Strong Buy', so you know that along with having cash on hand, these companies have passed a vote of confidence. We think you'll find the list we came up with rather interesting.

The Current ratio is a liquidity ratio used to determine a company's financial health. The metric illustrates how easily a firm can pay back its short obligations all at once through current assets. A company that has a current ratio of one or less is generally a liquidity red flag. Now this doesn't mean the company will go bankrupt tomorrow, but it also doesn't bode well for the company, and may indicate that it could have an issue paying back upcoming obligations.

The Quick ratio measures a company's ability to use its cash or assets to extinguish its current liabilities immediately. Quick assets include assets that presumably can be converted to cash at close to their book values. A company with a Quick Ratio of less than 1 cannot currently pay back its current liabilities. The quick ratio is more conservative than the Current Ratio because it excludes inventory from current assets, since some companies have difficulty turning their inventory into cash. If short-term obligations need to be paid off immediately, sometimes the current ratio would overestimate a company's short-term financial strength. In general, the higher the ratio, the greater the company's liquidity (i.e., the better able to meet current obligations using liquid assets).

We first looked for small cap stocks. We then looked for businesses that have a substantial amount of cash on hand (Current Ratio>2)(Quick Ratio>2). From here, we then looked for companies that analysts rate as "Strong Buy" (mean recommendation < 2). We did not screen out any sectors.

Do you think these small-cap stocks are worth more than the market currently says? Please use our list to assist with your own analysis.

1) Cirrus Logic Inc. (NASDAQ:CRUS)

Sector: Technology
Industry: Semiconductor - Specialized
Market Cap: $1.69B
Beta: 0.75

Cirrus Logic Inc. has a Current Ratio of 4.82 and Quick Ratio of 4.05 and Analysts' Rating of 1.30. The short interest was 15.07% as of 06/05/2012. Cirrus Logic, Inc., a fabless semiconductor company, develops and sells high-precision analog and mixed-signal integrated circuits (ICS) for audio and energy markets worldwide. The company offers analog and mixed-signal audio converter and audio digital signal processor (DSP) products, which include analog-to-digital converters (ADCs); digital-to-analog converters (DACs); codecs, which include chips for integrating ADCs and DACs into an IC; digital interface ICs; volume controls; and digital amplifiers, as well as audio DSPs for consumer electronics applications. Its audio products are used in various consumer applications, including portable media players, smartphones, tablets, AVRs, DVD and Blu-ray disc players, home theater systems, set-top boxes, gaming devices, gaming devices, sound cards, and digital televisions; professional applications comprising digital mixing consoles, multitrack digital recorders, and effects processors; and automotive applications consisting of amplifiers, satellite radio systems, telematics, and multi-speaker car-audio systems.

2) FEI Company (NASDAQ:FEIC)

Sector: Technology
Industry: Scientific & Technical Instruments
Market Cap: $1.62B
Beta: 1.32

FEI Company has a Current Ratio of 3.23 and Quick Ratio of 2.44 and Analysts' Rating of 1.50. The short interest was 7.78% as of 06/05/2012. FEI Company supplies scientific instruments for nanoscale imaging, analysis, and prototyping that enable research, development, and manufacturing in industrial, academic, and research institutional applications. Its products include transmission electron microscopes and scanning electron microscopes (SEMs); DualBeam systems, which include a SEM and focused ion beam system (FIB) on a single platform; and stand-alone FIBs. The company's Electronics segment offers products used in laboratories to enhance new product development and increase yields by enabling 3D wafer metrology, defect analysis, root cause failure analysis, and circuit edit for modifying device structures in the semiconductor equipment and related industries, such as manufacturers of data storage equipment, solar panels, and light-emitting diodes.

3) Coherent Inc. (NASDAQ:COHR)

Sector: Technology
Industry: Scientific & Technical Instruments
Market Cap: $1.01B
Beta: 1.13

Coherent Inc. has a Current Ratio of 3.78 and Quick Ratio of 2.75 and Analysts' Rating of 1.40. The short interest was 3.12% as of 06/05/2012. Coherent, Inc. provides photonics-based solutions for a range of commercial and scientific research applications worldwide. The company engages in designing, manufacturing, servicing, and marketing lasers, laser tools, precision optics, and related accessories. Its products are used in a range of applications, including microelectronics, scientific research and government programs, original equipment manufacturer components and instrumentation, and materials processing markets.

4) FutureFuel Corp. (NYSE:FF)

Sector: Basic Materials
Industry: Chemicals - Major Diversified
Market Cap: $378.08M
Beta: 0.49

FutureFuel Corp. has a Current Ratio of 6.28 and Quick Ratio of 4.58 and Analysts' Rating of 1.00. The short interest was 3.00% as of 06/05/2012. FutureFuel Corp. engages in the manufacture and sale of diversified chemicals and biobased products in the United States. The company operates in two segments, Chemicals and Biofuels. The Chemicals segment offers custom manufacturing products, including nonanoyloxybenzene-sulfonate, a bleach activator for detergent and consumer products manufacturers; a proprietary herbicide for life sciences companies; and chlorinated polyolefin adhesion promoters and antioxidant precursors for chemical companies, as well as a biocide intermediates for other diversified chemical companies.

5) Hawkins Inc. (NASDAQ:HWKN)

Sector: Basic Materials
Industry: Synthetics
Market Cap: $333.55M
Beta: 0.91

Hawkins Inc. has a Current Ratio of 3.44 and Quick Ratio of 2.33 and Analysts' Rating of 1.00. The short interest was 5.90% as of 06/05/2012. Hawkins, Inc. manufactures, blends, and distributes bulk and specialty chemicals in the United States. The company operates through two segments, Industrial and Water Treatment. The Industrial segment provides industrial chemicals, products, and services primarily to the agriculture, energy, electronics, food, chemical processing, pulp and paper, pharmaceutical, medical device, and plating industries.


Sector: Technology
Industry: Semiconductor - Specialized
Market Cap: $315.94M
Beta: 0.87

IXYS Corp. has a Current Ratio of 6.07 and Quick Ratio of 3.97 and Analysts' Rating of 1.50. The short interest was 3.55% as of 06/05/2012. IXYS Corporation, an integrated semiconductor company, engages in the development, manufacture, and marketing of power semiconductors, advanced mixed signal integrated circuits , application specific integrated circuits (ASICs), microcontrollers, and systems and radio frequency semiconductors. It offers power metal oxide silicon field effect transistors; insulated gate bipolar transistors; and thyristors and rectifiers, including fast recovery epitaxial diodes. The company's power semiconductors are used primarily in controlling energy in motor drives; power conversion systems, including switch-mode and uninterruptible power supplies; medical electronics; and renewable energy sources. It also provides ICs, such as solid state relays for telecommunications applications; power management and control ICs comprising current regulators, motion controllers, digital power modulators, and drivers; microcontrollers, including embedded flash microcontrollers, core 8-bit microcontrollers, and microprocessors; and line card access switch and data access arrangement integrated products.

7) LSB Industries Inc. (NYSE:LXU)

Sector: Industrial Goods
Industry: General Building Materials
Market Cap: $595.14M
Beta: 1.67

LSB Industries Inc. has a Current Ratio of 3.68 and Quick Ratio of 2.90 and Analysts' Rating of 1.30. The short interest was 3.09% as of 06/05/2012. LSB Industries, Inc., through its subsidiaries, engages in the manufacture and sale of geothermal and water source heat pumps, air handling products, and chemical products. The company operates in two segments, Climate Control Business and Chemical Business. The Climate Control Business segment manufactures and sells heating, ventilation, and air conditioning (HVAC) products that include geothermal and water source heat pumps; hydronic fan coils; and other HVAC products, such as custom air handlers and modular geothermal chillers.

8) ICU Medical, Inc. (NASDAQ:ICUI)

Sector: Healthcare
Industry: Medical Instruments & Supplies
Market Cap: $706.58M
Beta: 0.49

ICU Medical, Inc. has a Current Ratio of 10.87 and Quick Ratio of 9.40 and Analysts' Rating of 1.40. The short interest was 16.48% as of 06/05/2012. ICU Medical, Inc. engages in the development, manufacture, and sale of medical technologies used in infusion therapy, oncology, and critical care applications. The company's product line includes custom infusion systems, closed delivery systems for hazardous drugs, needleless infusion connectors, catheters, and cardiac monitoring systems. Its products enhance patient outcomes by preventing bloodstream infections, protecting healthcare workers and patients from exposure to infectious diseases or hazardous drugs, and monitoring the cardiac output of critical care patients.

9) Electronics for Imaging, Inc. (NASDAQ:EFII)

Sector: Technology
Industry: Computer Peripherals
Market Cap: $698.01M
Beta: 1.23

Electronics for Imaging, Inc. has a Current Ratio of 2.36 and Quick Ratio of 2.04 and Analysts' Rating of 1.30. The short interest was 2.66% as of 06/05/2012. Electronics For Imaging, Inc. provides color digital print controllers, digital inkjet printers, and business process automation solutions. The company's Fiery products consist of stand-alone print controllers and servers connected to digital copiers and other peripheral devices; embedded and design-licensed solutions used in digital copiers and multi-functional devices; optional software integrated into controller solutions that include Fiery Central and MicroPress; Entrac, a self-service and payment solution; PrintMe, a mobile printing application; and stand-alone software-based solutions, such as proofing and scanning solutions, including ColorProof XF, Fiery XF, ColorProof eXpress, and Xflow. It also offers industrial inkjet products, including VUTEk super-wide format digital industrial inkjet printers and inks used by billboard graphics printers, commercial photo labs, sign shops, graphic screen printers, specialty commercial printers, and digital graphics providers; Rastek hybrid and flatbed entry level production UV wide format inkjet printers; and Jetrion label and packaging digital inkjet printers, integration solutions, and specialty digital UV inks for primary and secondary label applications, and industrial label or flexible packaging markets.

*Company profiles were sourced from Finviz. Financial data was sourced from Google Finance and Yahoo Finance.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.