Roth starts Smart Balance at 'Buy' on efficiency

Anton Brenner assigned shares a price target of $13, implying he expects the stock to appreciate more than 90 percent over its Tuesday's close of $6.81.

At midday Wednesday, Smart Balance shares retreated 11 cents to $6.70 after climbing as high as $7.34 earlier in the session.

Brenner said Smart Balance outsources its manufacturing, distribution and warehousing operations, allowing it to operate nimbly with only 52 employees on nearly $230 million in estimated sales.

In addition, the Paramus, N.J., company's balance sheet has strengthened significantly over the past year, he said, and the company appears to be successfully passing on higher food prices.

Even though Smart Balance reported a loss in the first quarter because of higher commodity costs, Brenner said he expects the company to achieve profitability during the second half of the year.

Shares of Smart Balance have traded between $4.85 and $14.10 in the last 52 weeks. The stock is off 38 percent since the start of the year.