The Dow, the S&P 500, and the Nasdaq all tumbled again Thursday as Wall Street and investors pullback amid coronavirus fears. All three of the major U.S. indexes saw their 2020 gains washed away earlier in the week and they all fell into a correction Thursday, down more than 10% from their recent highs.
The yield on the 10-year U.S. Treasury note also fell to an all-time low on Thursday as investors sell stocks as the novel virus spreads outside of China to South Korea, Italy and elsewhere. Plus, the CDC has called for U.S. businesses, schools, and people to prepare for the coronavirus to spread domestically, as the White House makes plans for a proper response.
On top of that, Microsoft MSFT, Apple AAPL, Mastercard MA, and others have already warned investors that the slowdown of the Chinese economy is set to negatively impact their businesses.
Clearly, the coronavirus looks ready to plague markets until Wall Street has a more comprehensive picture of the full impact, which will likely take some time. However, stocks have already fallen so far so fast and the U.S. economy appears strong, while U.S. unemployment continues to rest near 50-year lows.
With this in mind, let’s dive into three cheap stocks, trading under $20 a share that investors might want to buy, or at least put on their watchlists as they wait for signs of a turnaround from the coronavirus selloff…
Noble Energy Inc. NBL
Prior Close: $15.12 USD
Noble Energy is independent oil and gas exploration and production firm. The Houston-based company’s portfolio includes crude oil and natural gas assets and on February 12 it posted a narrower-than-expected loss and its revenue topped our estimate. Oil and gas prices have taken a hit amid the coronavirus-induced economic slowdown.
In fact, Noble’s shares have taken a rather large hit in 2020, down 40%, and the stock has traded as high as $28 a share in the last 12 months. To help make up for the decline, NBL raised its dividend by 9% in 2019 and it currently holds a 3.14% yield. This blows away the 10-year U.S. Treasury’s 1.27% payout. And looking ahead, Noble’s outlook appears strong and it clearly has plenty of room to climb to reach it previous highs.
The firm’s adjusted fiscal 2020 earnings are projected to climb from a loss of -$0.35 per share to +$0.27 a share, based on our current Zacks estimates. Then Noble’s 2021 EPS figure is expected to soar 98% higher to reach $0.54 a share. Meanwhile, the oil and gas company’s revenue is set to climb 7.1% and 8.7%, respectively over this stretch. Noble’s positive earnings revisions help it hold a Zacks Rank #2 (Buy) and it sports an “A” grade for Momentum in our Style Scores system.
Telenav, Inc. TNAV
Prior Close: $5.84 USD
Telenav is a connected car and location-based services firm that works with the likes of Ford F and AT&T T. TNAV shares tumbled from over $10 per share in early September 2019 after General Motors GM, one of its major clients, announced that will start working with Google GOOGL in 2021. Telenav quickly noted that its contract with GM is still effective through model year 2025.
In January, TNAV announced that it extended its relationship with Amazon AMZN “to offer voice-first navigation through Alexa.” Looking ahead, our Zacks estimates call for company’s fiscal 2020 sales to surge 17% to reach $258 million. TNAV’s adjusted 2020 earnings are projected to soar from a loss of -$0.47 a share in the year-ago period to +$0.21 a share.
Plus, its consensus EPS estimates have climbed substantially in the last month to help Telenav grab a Zacks Rank #1 (Strong Buy) at the moment. TNAV also earns a “B” grade for Growth in our Style Scores system and it crushed our bottom-line estimates by 267% and 80%, respectively in the last two quarters. Investors should also note that shares of the connected car firm have climbed 21% in 2020.
Mitek Systems, Inc. MITK
Prior Close: $8.80 USD
Mitek Systems utilizes artificial intelligence and machine learning to help financial institutions and other enterprises verify a user’s identity during digital transactions. Mitek’s solutions are embedded into the apps of over 6,500 organizations and used by more than 80 million consumers to perform tasks such as mobile check deposit. At the end of January, it topped our Q1 FY20 estimates, driven by double-digit growth in mobile deposit and identity verification products.
Since the report, Mitek’s fiscal 2020 and 2021 earnings revisions have climbed to help it earn a Zacks Rank #1 (Strong Buy) at the moment. MITK also sports an “A” grade for Growth in our Style Scores system and it has crushed our bottom-line estimates in the trailing four periods. Mitek shares have popped 15% in 2020 and are up 180% in the last five years.
The San Diego-based company’s adjusted 2020 earnings are projected to surge 21.4% to $0.51 per share on 18.3% higher revenues. Peeking further ahead, Mitek’s top and bottom-lines are both expected to climb another 15% higher in 2021. Long-term, the mobile capture and digital identity verification company could be poised to grow in our online and mobile-heavy economy.
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Ford Motor Company (F) : Free Stock Analysis Report
AT&T Inc. (T) : Free Stock Analysis Report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
Noble Energy Inc. (NBL) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
General Motors Company (GM) : Free Stock Analysis Report
Mastercard Incorporated (MA) : Free Stock Analysis Report
Telenav, Inc. (TNAV) : Free Stock Analysis Report
Alphabet Inc. (GOOGL) : Free Stock Analysis Report
Mitek Systems, Inc. (MITK) : Free Stock Analysis Report
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