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.
Today we’ve highlighted ten stocks that are currently trading for under $20 per share. All of these stocks currently have at least a Zacks Rank #2 (Buy), and a variety of other factors make these companies stand out as having strong upside potential.
1. Cypress Semiconductor Corporation (CY)
Prior Close: $16.46
Cypress Semiconductor is a leading provider of high-performance digital and mixed-signal integrated circuits, and after shelling out $550 million for Broadcom’s Internet of Things business, its “WICED” platform is now one of the largest IoT portfolios in the industry. CY is currently a Zacks Rank #1 (Strong Buy) and is expected to witness EPS growth of 40% this fiscal year. The stock is also trading at an attractive 13.2x forward 12-month earnings. Meanwhile, CY sports a PEG of just 0.8, so investors know they are getting a great price for the company’s projected earnings growth.
2. FGL Holdings (FG)
Prior Close: $8.80
FGL is a holding company offering fixed annuities and life insurance products, forming after the merger of CF Corp. and Fidelity & Guaranty Life was completed late last year. The stock is sporting both a Zacks Rank #2 (Buy) and a “B” grade for Value in our Style Scores system. FG is trading with a P/E of 8.1, which marks a discount to its industry average. Value investors will also love its P/B ratio of just 1.2. The company reports its latest results next week, and earnings estimates for the quarter are trending upward into the announcement date.
3. BlackBerry Limited (BB)
Prior Close: $11.60
BlackBerry is best known to the public for its once-iconic brand of smartphones, but the company ditched hardware manufacturing recently and now serves as an enterprise software and services company. This transition is finally getting the attention of analysts, and an improving earnings outlook has earned the stock a Zacks Rank #1 (Strong Buy). The company has also managed to surpass EPS estimates in nine consecutive quarters. Still, this is one for the long haul, with earnings expected to expand at an annualized rate of nearly 19% over the next three to five years.
4. AudioCodes Ltd. (AUDC)
Prior Close: $7.49
AudioCodes designs, develops and markets enabling technologies and communication components for the transmission of voice, fax and modem over packet networks. Analysts have become increasingly bullish on AUDC lately, and our consensus projection for its full-year earnings has moved three cents higher in the past 60 days. The stock is a Zacks Rank #2 (Buy) based on this revision activity. The company is now expected to witness EPS growth of 22% on 9% higher revenue this fiscal year. Meanwhile, AUDC’s P/E of 16.6 represents a discount to its industry average.
5. Callaway Golf Company (ELY)
Prior Close: $18.58
Callaway is one of the largest golf apparel and equipment companies in the world, manufacturing respected gear for both professionals and amateurs. The stock is currently sporting a Zacks Rank #2 (Buy), as well as a “B” grade for Momentum. This is an interesting pick for those looking to ride a recent trend, as shares have surged more than 20% in just three months. This momentum is inspired by the company’s recent earnings beat and positive revision activity. ELY’s consensus EPS estimate for 2018 has gained 11 cents over the past month, and Callaway is now expected to see earnings growth of 53% this fiscal year.
6. Two River Bancorp (TRCB)
Prior Close: $17.56
Two River Bancorp a state-chartered commercial bank engaged in commercial and retail banking in New Jersey. The company is coming off a record quarter in terms of net income and earnings per share, which has helped its outlook improve and lifted the stock to a Zacks Rank #2 (Buy). For a regional bank, this is a hot growth option, with earnings and revenue expected to improve by 36% and 12%, respectively, in 2018. Meanwhile, shares are trading at just 13.7x forward 12-month earnings.
7. Ultra Clean Holdings, Inc. (UCTT)
Prior Close: $16.84
Ultra Clean Holdings is a developer and supplier of critical subsystems for the semiconductor capital equipment, flat panel, solar and medical device industries. UCTT is holding a Zacks Rank #2 (Buy) and holds an “A” grade in the Value and Growth categories. The firm is expected to see revenue growth of 25% in the current year, with cash flow growth reaching 172% recently. Meanwhile, the stock has a P/E of just 7.1 and a PEG of 0.5. This means that investors are getting a solid price for the company’s earnings and growth outlook.
8. New Residential Investment Corp. (NRZ)
Prior Close: $18.15
New Residential is a mortgage REIT focused on the residential real estate market. The company pioneered investments in so-called Excess MSRs—which enable it to collect monthly cash flows without assuming some servicing duties, advance obligations, or liabilities. NRZ is a Zacks Rank #1 (Strong Buy) and offers a dividend yield of about 11.1%. The stock is also an interesting value play, with shares trading at just 7.8x forward earnings. NRZ also recently beat earnings estimates and watched its 2018 outlook improve significantly.
9. Commercial Vehicle Group, Inc. (CVGI)
Prior Close: $8.51
Commercial Vehicle Group supplies interior systems, vision safety solutions and other cab-related products for the global commercial vehicle market. CVGI is sporting both a Zacks Rank #1 (Strong Buy) and a “B” grade in our Value category. Shares have popped more than 21% in the past month, but the stock still looks undervalued. CVGI has a P/E of just 6.5 and a P/S of 0.3—both of which are significant discounts to industry averages.
10. Big 5 Sporting Goods Corporation (BGFV)
Prior Close: $8.05
Big 5 is a sporting goods retailer with about 420 stores in the western United States. Conditions have been tough for sports retailers over the past few years, but BGFV appears to have found a bottom and surged more than 30% in the past 12 weeks. The stock is now a Zacks Rank #1 (Strong Buy). Shares are trading at just 11.8x forward 12-month earnings, while the stock’s P/B of 0.9 and P/S of 0.2 are also nice discounts.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Ultra Clean Holdings, Inc. (UCTT) : Free Stock Analysis Report
Cypress Semiconductor Corporation (CY) : Free Stock Analysis Report
AudioCodes Ltd. (AUDC) : Free Stock Analysis Report
Commercial Vehicle Group, Inc. (CVGI) : Free Stock Analysis Report
Two River Bancorp (TRCB) : Free Stock Analysis Report
Callaway Golf Company (ELY) : Free Stock Analysis Report
New Residential Investment Corp. (NRZ) : Free Stock Analysis Report
Big 5 Sporting Goods Corporation (BGFV) : Free Stock Analysis Report
BlackBerry Limited (BB) : Free Stock Analysis Report
FGL Holdings (FG) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research