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Find Cheap Stocks Under $10 to Buy with this Screener
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The Dow fell 1.4% on Tuesday for its biggest one-day drop since February, while the S&P 500 fell 0.87%. The downturn comes as Wall Street once again focuses on the possibility of higher inflation amid pent-up demand, supply chain setbacks, the Fed’s easy-money policies, and more.
The Nasdaq tumbled 2.6% on Monday and looked poised for another big downturn, but investors stepped in when they thought things had been a bit overdone to help the tech-heavy index close the day roughly flat. The Nasdaq has slipped below its 50-day moving average and is down around 5% from its late April highs. But the blue-chip and benchmark indexes hover just off their recent May records
The market is still on a stellar run off the coronavirus lows last March, with the Nasdaq up around 50% and the S&P up 45%. Inflation, or the fear of it, could hamper the economy and the market. But the broader bull case for 2021 likely remains in place and Wall Street will always take opportunities to pull profits.
It took the Nasdaq about a month to fall into a correction from its mid-February records, only to reach new highs once again in late April. Given this backdrop, investors likely want to remain exposed to the market. Therefore, we screened for strong stocks that are trading for under $10 a share that might be worth buying despite inflation fears…
Penny Stocks
One dollar or less used to be the common threshold for what we call “penny stocks.” Today, the SEC has expanded penny stocks to securities that trade for less than $5 a share. Many investors avoid these stocks because they are speculative in nature.
Meanwhile, penny stocks often trade infrequently and hold wide bid/ask spreads. These stocks also carry many other traits that, in many cases, cause excessive volatility. With that said, some penny stocks perform incredibly well, which helps them remain attractive.
Stocks Under $10
Moving on, let’s briefly discuss the next class of cheap stocks. Stocks that trade in the $5 to $10 range are generally less risky than their penny stock counterparts. Investors might be more likely to have heard of these companies or seen the tickers. They are, however, still inherently more speculative than many other higher-priced stocks.
Investors can obviously find winning stocks for under $10 if they are extremely selective. So today, we narrowed the list of thousands of these more speculative stocks down to a more manageable group of $10 and under stocks that might help boost your portfolio.
Screen Parameters
• Price less than or equal to $10
• Volume greater than or equal to 1,000,000
• Zacks Rank less than or equal to 2
(No Holds, Sells or Strong Sells.)
• Average Broker Rating less than or equal to 3.5
(Average Broker Rating of a Hold or Better.)
• # of Analysts in Rating greater than or equal to 2
(Minimum of at least two analysts covering the stock.)
• % Change F1 Earnings Estimate Revisions -- 12 Weeks greater than or equal to 0
(Preferably upward earnings estimate revisions, but definitely no downward revisions.)
Here are two stocks of nearly 20 highly-ranked stocks trading under $10 a share that made it through the screen today…
Overall, all three of these stocks offer solid growth potential. Yet, it isn’t wise to pack your portfolio full of cheap, $10 or less stocks. Still, these stocks are certainly worth further investigation because grabbing a few of the top names from this list might bolster your returns. And let’s not forget that picking a few cheap stocks can also be quite fun.
Get the rest of the stocks on this list and start screening for the best stocks under $10 for yourself. And don't forget to backtest your strategy so you'll know how successful it's been before you put any of your money at risk.
Want more articles from this author? Scroll up to the top of this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
It's hard to believe, even for us at Zacks. But from 2000-2020, while the market gained +6.6% per year, our top stock-picking strategy averaged +52.4% per year.
How has that screen done lately? From 2016-2020, it more than tripled the market's +103.9% gain with a soaring +381.1% return.
Image: Bigstock
Find Cheap Stocks Under $10 to Buy with this Screener
The Dow fell 1.4% on Tuesday for its biggest one-day drop since February, while the S&P 500 fell 0.87%. The downturn comes as Wall Street once again focuses on the possibility of higher inflation amid pent-up demand, supply chain setbacks, the Fed’s easy-money policies, and more.
The Nasdaq tumbled 2.6% on Monday and looked poised for another big downturn, but investors stepped in when they thought things had been a bit overdone to help the tech-heavy index close the day roughly flat. The Nasdaq has slipped below its 50-day moving average and is down around 5% from its late April highs. But the blue-chip and benchmark indexes hover just off their recent May records
The market is still on a stellar run off the coronavirus lows last March, with the Nasdaq up around 50% and the S&P up 45%. Inflation, or the fear of it, could hamper the economy and the market. But the broader bull case for 2021 likely remains in place and Wall Street will always take opportunities to pull profits.
It took the Nasdaq about a month to fall into a correction from its mid-February records, only to reach new highs once again in late April. Given this backdrop, investors likely want to remain exposed to the market. Therefore, we screened for strong stocks that are trading for under $10 a share that might be worth buying despite inflation fears…
Penny Stocks
One dollar or less used to be the common threshold for what we call “penny stocks.” Today, the SEC has expanded penny stocks to securities that trade for less than $5 a share. Many investors avoid these stocks because they are speculative in nature.
Meanwhile, penny stocks often trade infrequently and hold wide bid/ask spreads. These stocks also carry many other traits that, in many cases, cause excessive volatility. With that said, some penny stocks perform incredibly well, which helps them remain attractive.
Stocks Under $10
Moving on, let’s briefly discuss the next class of cheap stocks. Stocks that trade in the $5 to $10 range are generally less risky than their penny stock counterparts. Investors might be more likely to have heard of these companies or seen the tickers. They are, however, still inherently more speculative than many other higher-priced stocks.
Investors can obviously find winning stocks for under $10 if they are extremely selective. So today, we narrowed the list of thousands of these more speculative stocks down to a more manageable group of $10 and under stocks that might help boost your portfolio.
Screen Parameters
• Price less than or equal to $10
• Volume greater than or equal to 1,000,000
• Zacks Rank less than or equal to 2
(No Holds, Sells or Strong Sells.)
• Average Broker Rating less than or equal to 3.5
(Average Broker Rating of a Hold or Better.)
• # of Analysts in Rating greater than or equal to 2
(Minimum of at least two analysts covering the stock.)
• % Change F1 Earnings Estimate Revisions -- 12 Weeks greater than or equal to 0
(Preferably upward earnings estimate revisions, but definitely no downward revisions.)
Here are two stocks of nearly 20 highly-ranked stocks trading under $10 a share that made it through the screen today…
Annaly Capital Management, Inc. (NLY - Free Report)
Kosmos Energy Ltd. (KOS - Free Report)
Overall, all three of these stocks offer solid growth potential. Yet, it isn’t wise to pack your portfolio full of cheap, $10 or less stocks. Still, these stocks are certainly worth further investigation because grabbing a few of the top names from this list might bolster your returns. And let’s not forget that picking a few cheap stocks can also be quite fun.
Get the rest of the stocks on this list and start screening for the best stocks under $10 for yourself. And don't forget to backtest your strategy so you'll know how successful it's been before you put any of your money at risk.
Click here to sign up for a free trial to the Research Wizard today.
Want more articles from this author? Scroll up to the top of this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at: https://www.zacks.com/performance/.
Zacks' Super Screen
It's hard to believe, even for us at Zacks. But from 2000-2020, while the market gained +6.6% per year, our top stock-picking strategy averaged +52.4% per year.
How has that screen done lately? From 2016-2020, it more than tripled the market's +103.9% gain with a soaring +381.1% return.
Free – See the Stocks It Turned Up for Today >>