), a provider of automated fingerprint and other biometric identification gear to law-enforcement agencies, has been on a tear: Sales vaulted from $13 million in 2001 to $88 million last year -- and are estimated to have nearly doubled, to $160 million, in 2005. But the stock has been in a downspin since August when it was at 33. Now at 25, the stock was hit when Cogent failed to win some contracts in Latin America. But the drop, says Marion Schultheis, managing director at J.&W. Seligman, is a classic buying opportunity thanks to Cogent's long-term growth potential. She expects it to win new contracts this year. Cogent, she notes, has a chance to be awarded a part, if not all, of a major four-year biometric upgrade at the FBI valued at several hundred million dollars. Julie Santoriello of Morgan Stanley (MWD
), who rates the stock "overweight," notes in a report that she sees $203 million in new contracts in 2006. She expects Cogent sales to jump to $251 million this year. Some 66% of Cogent's estimated 2006 sales are already booked, she says. She figures Cogent earned 71 cents a share in 2005 and should make 95 cents in 2006, up from 38 cents in 2004.
Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them. By Gene G. Marcial