Here at Zacks, we don’t generally classify stocks as “cheap” or “expensive”, and rather than looking at the stock’s face value, we have a system that puts an emphasis on earnings estimate revisions to find stocks that will hopefully be winners for investors.
That being said, low-priced stocks can be attractive to smaller investors that can’t necessarily afford large stakes in companies with higher priced stocks.
When looking at these low-priced stocks, we can look at the same trends in growth, value, and momentum and apply the Zacks Rank to properly analyze the potential that these companies have. We are also keenly 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 per share and holds a Zacks Rank #2 (Buy) or better. Take a look at the strong estimate revision activity and other factors that make these tech companies stick out right now:
1. CounterPath Corporation (CPAH)
Prior Close: $3.93
CounterPath designs desktop and mobile application software, including voice over Internet protocol, unified communications, and fixed-mobile convergence solutions. The stock is currently a Zacks Rank #2 (Buy) and has soared more than 50% over the past 12 weeks.
Our consensus estimate for the company’s upcoming fiscal year earnings has risen by 13 cents within the last 60 days. The firm is now expected to be profitable and improve its EPS results by over 1,000% next year. CounterPath is also witnessing cash flow growth of 16%, and its P/S ratio of 1.89 comes at a significant discount to the “Computer – Software” industry average.
2. AudioCodes Ltd. (AUDC)
Prior Close: $7.25
AudioCodes designs, develops, and markets enabling technologies and communication components for the transmission of voice, fax and modem over packet networks. AUDC is currently sporting a Zacks Rank #2 (Buy), and the stock has emerged as an interesting growth pick thanks to strong expansion estimates.
Our consensus estimates are calling for earnings growth of more than 16% in both fiscal 2018 and 2019. Meanwhile, the company’s cash flow growth is expanding at a rate of nearly 18% right now. Still, shares are trading with a P/E of just 17 and a P/S of 1.32, so investors are getting a pretty solid price for the stock right now.
3. Advanced Semiconductor Engineering, Inc. (ASX)
Prior Close: $6.73
Advanced Semiconductor Engineering is an independent provider of semiconductor packaging services and semiconductor testing services, including front-end engineering testing, wafer probing and final testing services. ASX is currently holding a Zacks Rank #2 (Buy).
Shares of ASK are trading at just 14x earnings and sport a P/S of 1.17. The stock also has a PEG of 1.82, so its earnings growth is coming at a decent price too. Advanced Semiconductor is expected to improve its earnings at an annualized rate of 8% over the next three to five years. The company also offers a respectable 2.4% dividend.
A stock’s market price is not a clear indicator of whether it is a good investment. However, the nice thing about the Zacks Rank is that it can be applied to stocks of any price. For smaller investors looking to find solid tech stocks at lower prices, this list is a great place to start.
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AudioCodes Ltd. (AUDC) : Free Stock Analysis Report
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