Wall Street Favorites: 3 Under-$10 Stocks with Strong Buy Ratings for March 2024
Finding undervalued stocks is one of the key elements to making successful investments. Undervalued stocks are those that trade below their intrinsic value, meaning that the market has not fully recognized their “true potential.” Sometimes you can find stocks that are undervalued if they’re trading below a certain dollar amount per share. Strong-buy stocks under $10 could be a good place to start. However, not all low-priced stocks are undervalued. In fact, some of them may be cheap due to poor performance or weak fundamentals.
In this article, we will explore three strong-buy stocks under $10 that are currently in Wall Street’s good graces.
SoundHound AI (SOUN)
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SoundHound AI (NASDAQ:SOUN) develops independent voice artificial intelligence (AI) solutions that enables businesses across automotive, TV, IoT and the customer service industries to deliver AI-driven conversational experiences to customers. The Houndify platform offers enterprises a suite of tools to build conversational voice assistants. From 2017 to 2019, SoundHound was able to gain large customers like Hyundai (OTCMKTS:HYMTF), Honda (NYSE:HMC) and Pandora who wanted to develop capable voice assistants for their products.
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Once generative AI came to the mainstream in 2023, the company also launched SoundHound Chat AI, which integrates with knowledge domains, pulling real-time data like weather, sports, stocks, flight status and restaurants create an AI-powered voice assistant experience.
According to Koyfin, SoundHound has been able to deliver solid double-digit revenue growth while also making meaningful increases to diluted EPS over the past several years. The company’s share price is only trading at $6.93 and based on the AI craze these days, SoundHound’s shares could go higher.
Enfusion (ENFN)
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Enfusion (NYSE:ENFN) is a cloud-based software provider for the investment management industry. The company offers an integrated platform that combines portfolio management, order execution, risk analytics, accounting and reporting functions for hedge funds, asset managers and family offices. Furthermore, Enfusion provides several outsourced middle- and back-office services, including trade reconciliation, valuation and fund administration.
Trading at $9.40 per share, Enfusion remains undervalued with a forward-looking enterprise value-to-sales ratio of 4.1x and enterprise value-to-EBITDA ratio of 19.5x. The software platform for investment managers generates positive net income and operates in an industry with evolving and complex needs. Despite the macro environment being uncertain, banks and asset managers are still willing to invest in IT solutions to modernize their internal processes. Enfusion’s Q4’2023 earnings print showcases the company had another year of record revenue and based on 2024 full year, will have another year of solid double-digit revenue growth.
ARS Pharmaceuticals (SPRY)
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The final stock on this list is a biotech firm that specializes in severe allergy medication. In particular, ARS Pharmaceuticals (NASDAQ:SPRY) develops treatments for adults and children who have severe allergic reactions. The pharmaceutical company is in the midst of developing a needle-free, epinephrine nasal spray (“neffy”) for patients and with type I allergic reactions, including anaphylaxis.
The neffy product is currently undergoing clinical trials and has produced promising results thus far. Trading at $8.46, SPRY could be a decent biotech bet, especially as shares come down from their YTD high point.
On the date of publication, Tyrik Torres did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.
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