Categorized | Stock Tips

Under $10 Stocks With Big Potential

Share Button


Under $10 Stocks

Are you looking for under $10 stocks with big potential?  There is no shortage of under $10 stocks; however, just because stocks are cheap does not mean that all of them present good value.  In fact, that is one of the primary mistakes that many new investors make, mistaking a cheap stock price for good value.  Instead of just buying stocks that trade for under $10 in the hopes that some will turn around and increase in value, it is important to understand how to value a stock that is trading under $10 per share and why the nominal price of a stock is not all that important in the grand scheme of making money trading and investing in stocks.

How To Find Under $10 Stocks With Big Potential To Move Higher

Everyone loves a sale, including when stocks are “on sale” under $10 per share.  However, an inexpensive price does not translate directly into good value.  Many companies have stocks trading for under $10 per share for good reason, because their businesses are faltering and their financial outlook is growing cloudy.  Other companies have so many shares issued that their revenue and earnings growth does not support a valuation that can get their stock above $10 per share.  This is the key to understanding which under $10 stocks present real value and have the potential to move higher and which ones are likely to stay under $10 per share for the foreseeable future.

Sirius XM For example, Sirius XM Holdings Inc. (NASDAQ: SIRI) trades at only $3.58 per share.  That may seem like a bargain; however, with 5.67 billion shares outstanding, Sirius XM has a market cap of over $20 billion.  Given the company’s revenue and earnings profile, it is fully valued at $20 billion and can not be expected to rise over $10 per share in the foreseeable future.

Increases in earnings are what ultimately cause stocks to move higher.  If a stock is trading under $10 per share because of a temporary issue that is affecting their earnings, such as a merger that is costing more than anticipated or a slowdown in the economy that is impacting a company’s earnings, the stock would present a good buying opportunity, if the earnings are expected to increase once the temporary issues have been resolved.  Another scenario in which a stock trading under $10 per share would clearly be a buy is if a company is transitioning from losses to earnings.  This is the case for many newer companies that have a stock price below $10 per share because of their newness and lack of earnings history.  Once they transition into companies that are profitable with growing revenue and earnings, the stock will most likely respond by ascending to levels above $10 per share, sometimes well over $10 per share over time.

Stock trading under $10 per share that are considered strong buys are stocks that have projected earnings increases of over 20% on an annual basis for the foreseeable future.   If there is one thing that Wall Street loves in a stock, it is consistently increasing earnings.  Stocks with fast earnings growth rates will not remain under $10 per share for long, and have the potential to make exceptional gains.  It is not unheard of for stocks with high earnings growth rates to go from under $10 per share to over $100 per share within a few years.  Just keep in mind that the stock market discounts future earnings by six to nine months in advance, so get in ahead of the herd, if you come across an under $10 per share stock that has the potential for strong future earnings growth.

Under $10 Stocks Ideas

Groupon The following are under $10 stocks to consider.  Of course, there are many under $10 stocks to choose from, so this is by no means a complete list, and should only serve as a starting point to find under $10 stocks that may have the potential to rise in the future.

  • Aerohive Networks Inc. (NYSE: HIVE) designs and develops cloud-managed mobile networking platform that enables enterprises to deploy a mobile-centric network edge.
  • Alphatec Holdings Inc. (NASDAQ: ATEC) is a medical technology company that focuses on the design, development, manufacturing, and marketing of products for the surgical treatment of spine disorders.
  • Applied Micro Circuits Corp. (NASDAQ: AMCC) provides connectivity and computing solutions in the United States and internationally. The company offers X-Gene, a server on a chip product for use in cloud data center, computing, and enterprise applications; and embedded computing products.
  • Coeur Mining Inc. (NYSE: CDE) is engaged in the ownership, operation, exploration, and development of silver and gold mining properties primarily in the United States, Mexico, Bolivia, Argentina, Australia, Ecuador, and Chile. .
  • 8×8 Inc. (NASDAQ: EGHT) provides unified communications and collaboration (UCC) services in the cloud for small and medium businesses, and mid-market and distributed enterprises.
  • Groupon Inc. (NASDAQ: GRPN) Groupon, Inc. operates online local commerce marketplaces that connect merchants to consumers by offering goods and services at a discount.  It also runs a direct deals site for products that the company sells directly.
  • Glu Mobile Inc. (NASDAQ: GLUU) develops and publishes a portfolio of action/adventure and casual games for the smartphones and tablet devices users.
  • Higher One Holdings Inc. (NYSE: ONE) provides technology-based refund disbursement, payment processing, and data analytics services to higher education institutions and students in the United States.
  • Iridium Communications Inc. (NASDAQ: IRDM) provides mobile voice and data communications services through satellite to businesses, governments, non-governmental organizations, and consumers worldwide.
  • Huntington Bancshares Inc. (NASDAQ: HBAN) operates as a bank that provides commercial, small business, and consumer banking services.
  • Orbitz Worldwide Inc. (NYSE: OWW) as an online travel company that operates worldwide.  It enables leisure and business travelers to research, plan, and book a range of travel products and services.
  • SLM Corp. (NYSE: SLM),better known as Sallie Mae, operates as a financial services company specializing in education lending in the United States.
  • Sucampo Pharmaceuticals Inc. (NASDAQ: SCMP) is a biopharmaceutical company that focuses on the research, discovery, development, and commercialization of proprietary drugs based on prostones and other drug technologies to treat gastrointestinal, ophthalmic, neurologic, and oncology-based inflammatory disorders, as well as for other therapeutic applications.

Stay up to date on stock tips by getting on our FREE eMail list

This post was written by:

- who has written 536 posts on StockRockandRoll.

Contact the author

Comments are closed.

© 2021 MJ Capital, LLC | All rights reserved