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 shares. 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.
Moreover, recent volatility in the stock market has lowered valuations and taken several notable stocks under mental per-share thresholds as investors start to look toward the New Year. Today we’ve highlighted five stocks that are currently trading for under $10 per share.
All of these stocks currently sport a Zacks Rank #2 (Buy) or better, and the selected companies are showing signs of outpacing the market throughout the remainder of the calendar year—and more importantly, into 2019.
Check out these five great stocks under $10 for 2019:
1. Ericcson (ERIC)
Prior Close: $8.78
Ericsson is a world-leading supplier in the telecommunications and data communications industries, offering advanced solutions for mobile and fixed networks, as well as consumer products. ERIC is sporting a #1 (Strong Buy) with just a few weeks left in the year, and its “A” grade in our Growth category adds to that promise going forward.
Earnings growth is expected to total nearly 160% in fiscal 2018, and early estimates have that figure improving another 47% next year. Earnings estimates for 2019 have already trended upward, which is a sign of positive analyst sentiment. The stock also seems to be reasonably valued, as evidenced by its P/S ratio of 1.2. This stock warrants a look while it is still cheap.
2. eGain Corporation (EGAN)
Prior Close: $7.13
eGain is a provider of customer engagement cloud solutions. The firm offers B2C companies a simple and affordable suite of products which deliver multichannel customer service through a single interaction and knowledge management platform. EGAN has a #1 (Strong Buy) and is looking poised for strong growth this fiscal year, which ends in June 2019. Earnings are expected to improve by 33% on 7% revenue growth in that period.
EGAN’s valuation is stretched, as the stock trades like a long-term growth prospect typically would. However, it does have a P/S ratio of 3.2, which is a steep discount to the industry average of 4.1. The Price-to-Sales ratio is often a better value metric for these smaller tech stocks, and EGAN is trading at a smaller revenue multiple than one might expect from a cloud pure-play right now.
3. inTest Corporation (INTT)
Prior Close: $6.78
InTest makes ATE interface solutions and temperature management products, which are used by semiconductor manufacturers to perform important testing of certain circuits and wafers. The big thing to like here for 2019 is the magnitude of EPS estimate revisions. The Zacks Consensus mark for this period has increased 21 cents, or 28%, in the past 60 days. This means sentiment related to next year’s earnings is improving dramatically. Moreover, the stock is trading with a P/E of just 6.7, which is a discount compared to its industry’s average.
4. Trivago N.V. ADS (TRVG)
Prior Close: $5.80
Trivago is a travel booking website. Based in Germany, it offers deal-oriented service related to booking hotels and lodging to a wide global user base. TRVG was battered in the second half of last year, but that selling found a stopping point this summer. Though the stock has pulled back in recent volatile condition, it is still more than 40% off its lows. TRVG is currently sporting a #2 (Buy) and an “A” grade in the Growth category of our Style Scores system.
In 2019, earnings are expected to inch into the green and improve roughly 113% from the current year’s projected totals. On a long-term basis, analysts see Trivago notching an annualized growth rate of 7.5%.
5. Snap Inc. (SNAP)
Prior Close: $5.67
Snap is the parent company of Snapchat, a popular picture and video messaging mobile application. It is no secret that Snap has struggled since its IPO in the face of stiff competition from bigger social media companies, but the firm is finally starting to win analyst favor. Estimates for its fiscal 2019 have improved, and while Snap is still likely to be in the red, our EPS consensus is calling for a bottom-line improvement of 36%.
That would come on the back of 34% revenue growth, which is expected on top of the 41% sales growth this year is estimated to see. Strong earnings and revenue growth should help this #2 (Buy)-ranked stock find a bottom and surge into the New Year.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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Trivago N.V. ADS (TRVG) : Free Stock Analysis Report
eGain Corporation (EGAN) : Free Stock Analysis Report
Snap Inc. (SNAP) : Free Stock Analysis Report
Ericsson (ERIC) : Free Stock Analysis Report
inTest Corporation (INTT) : Free Stock Analysis Report
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