U.S. markets did little more than tread water this week after rising dramatically from oversold levels in the previous week.
But while the major indices didn’t gain much ground, many of the sub-$5 stocks were catching fire. As usual, there was a fair share of smaller biotech companies showing strength, but a nice mix of sectors found success this week, as well.
Here are the five best under $5 from this second week of October.
Best Stocks Under $5: Metabolix, Inc. (MBLX)
10/16/15 Closing Price: $2.75 (+24% for the week)
Metabolix, Inc. (NASDAQ:MBLX) is a company that sells pellets for water treatment filters for hobby aquarium supply businesses.
Metabolix shot up this week after announcing it has signed an exclusive agreement with Kolar Filtration LLC to distribute PHA-based denitrification pellets in water treatment applications, including aquariums, ornamental ponds, aqua farming and fresh- and salt-water hatcheries.
MBLX stock has been losing money for almost two years, but despite falling 11% on Friday, this week’s overall performance wiped out three months’ worth of losses.
Best Stocks Under $5: MeetMe Inc (MEET)
10/16/15 Closing Price: $2.30 (+19% for the week)
MEET stock had been doing rather poorly for a very long time, prior to October 8 when it reported preliminary Q3 results with revenue of $14.2 million that surpassed its previous guidance of $12.5 to $13 million for the third quarter.
MEET stock gapped up, and has done very well since then. This week, Zacks Equity Research put out a very bullish article on MEET, saying it is “looking especially impressive right now”, and calling it a “solid momentum stock”.
Best Stocks Under $5: Fortuna Silver Mines Inc (FSM)
10/16/15 Closing Price: $2.92 (+8% for the week)
It was a good week for precious metal stocks, and that included small cap Fortuna Silver Mines Inc (NYSE:FSM). The company reported third-quarter production results from two of its existing mines in Mexico and Peru. FSM produced 1.7 million ounces of silver and 10,963 ounces of gold.
For the first three quarters of 2015, FSM has produced 5 million ounces of silver and 29,734 of ounces of gold.
President and CEO Jorge A. Ganoza said the company continues on target to meet its annual consolidated production guidance.
It has been a tough year for FSM stock, but after bottoming in mid-September, FSM stock has rocketed up almost 40% over the past month.
Best Stocks Under $5: Digirad Corporation (DRAD)
10/16/15 Closing Price: $4.64 (+17% for the week)
This week, Digirad Corporation (NASDAQ:DRAD) signed a deal to purchase DMS Health Technologies from Platinum Equity for $36 million in cash, in a deal expected to close before the end of the year. The company says the transaction will be immediately accretive to DRAD’s earnings and cash flow on an adjusted basis.
DMS Health is a provider of mobile diagnostic imaging and other similar services to hospitals across the U.S., but mostly throughout the Midwest regions.
Investors may want to consider two other positives about DRAD: Wells Fargo & Co (NYSE:WFC) has recently provided Digirad with a senior secured credit line up to $40 million, and the company pays a quarterly dividend with an annual yield over 4%.
Best Stocks Under $5: Neovasc Inc. (NVCN)
10/16/15 Closing Price: $5.80 (+37% for the week)
This morning, Neovasc Inc. (NASDAQ:NVCN) announced that its Tiara technology was highlighted in a “live case” broadcast, seen by the 27th annual Transcatheter Cardiovascular Therapeutics (TCT) scientific symposium, in San Francisco.
The Tiara is a 35 mm transcatheter mitral valve that is used in cases of severe mitral regurgitation (MR) who are at high risk for conventional surgical procedures.
This week NVCN was also the recipient of a reiterated “buy” rating from analyst Jason Mills of Canaccord Genuity Group Inc (TSE:CF). Mills set a price target for the specialty medical company of $15 — more than 150% higher than the current price.
Neovasc is expected to announce its next quarterly earnings report on or about Nov. 12.
NVCN stock, which was as low as $4.25 on Friday morning, actually surged late this afternoon to finish with a 30% gain.
As of this writing, Ethan Roberts did not hold a position in any of the aforementioned securities.
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