At Zacks, we try to avoid labeling stocks as “cheap” or “expensive.” Instead, we opt to look beyond a stock’s face value, and our system puts an emphasis on earnings estimate revisions to find stocks that will hopefully be winners for investors.
With that said, low-priced stocks can still be attractive to investors as they present the chance to take a larger position in a company, which they might not be able to in higher-priced stocks.
When searching for these low-priced stocks, we still look for similar trends in growth, value, and momentum. Then we apply the Zacks Rank to properly analyze the potential that these companies have. We are also aware of the latest sector trends and make sure to cover all of the hottest industries.
Today we’ve highlighted three stocks that fall into the broad “technology” sector. Each of these three stocks is currently trading for less than $10 a share and holds a Zacks Rank #1 (Strong Buy) or #2 (Buy) at the moment.
1. Zix Corporation ZIXI
Prior Close: $8.31 USD
Zix is an email security firm that specializes in data loss prevention, threat protection, email encryption, and more. The company, which is currently a Zacks Rank #2 (Buy) that sports an “A” grade for Growth in our Style Scores system, has seen its stock price soar over 41% in a month.
Looking ahead, Zix is expected to see its soon-to-be-reported earnings pop 12.5% to reach $0.09 a share on the back of roughly 9% revenue growth. The email security firm’s outlook appears far more positive in the following quarter, with our estimates calling for 150% top-line and 25% bottom-line expansion. Zix is also part of the Zacks “Security” industry, which ranks 13th at the moment out of our 255 industries.
2. The Meet Group, Inc. MEET
Prior Close: $5.58
The Meet Group is a social media company offering several different social entertainment apps, including MeetMe, Skout, and Lovoo. These apps are primarily focused on streaming video, mobile chat, gifting, and photo sharing. MEET, which is coming off a third quarter that saw its revenue soar over 40%, has put together an impressive year in terms of earnings beats, and shares are starting to behave as one might expect from a growth and momentum pick.
On top of that, MEET still looks pretty cheap at the moment, especially considering that it is profitable and is trading at 19.7X forward 12-month Zacks Consensus EPS estimates, which marks a discount compared to its industry’s 30X average. The Meet Group has also experienced strong upward earnings estimate revision activity recently that helps it earn a Zacks Rank #1 (Strong Buy).
3. Identiv, Inc. INVE
Prior Close: $4.60
INVE is a security technology provider that caters to governments, healthcare providers, and an array of other industries, offering everything from secure corporate IDs and other RFID-enabled applications to more effective video and data analytics. Identiv’s Q3 revenues climbed 30% and it completed its acquisition of Thursby Software Solutions, which will help it bolster the firm’s core business and add to its list of more than 5,000 customers.
Looking ahead to the fourth quarter, the company is projected to swing from a loss of $0.14 a share to post adjusted earnings of $0.02, on the back of roughly 24% top-line expansion. Identiv is also currently as Zacks Rank #1 (Strong Buy) that rocks “A” grades for both Growth and Momentum in our Style Scores system. Identiv’s business might also expand simply because security has become more complex in our digital world.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
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