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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 a Zacks Rank #1 (Strong Buy), and a variety of other factors make these companies stand out as having strong upside potential.
American Eagle Outfitters is a specialty retailer of casual apparel, accessories, and footwear for men and women between the ages of 16 and 34. The company has not been immune to the struggles of mall-based retailers, but shares are rebounding and have surged 30% in the past month. Still, the stock has a P/E of 16.38 and a P/S of 0.92, so investors could be undervaluing the strength of its revenues and profits. Moreover, there is still some expansion left for the brand, as earnings are projected to grow at an annualized rate of 8.74% over the next three to five years.
Deutsche Telekom is Europe's largest communications company and is, with its T-Mobile subsidiary, one of the largest telecom firms in the world. The stock is currently sporting an “A” grade for Value and a “B” grade for Momentum in our Style Scores system. The company’s $4.14 per share cash flow nearly doubles its industry average, and its RoE of 10.95% further highlights its efficiency. DTEGY also pays out a 3.66% dividend, making it a viable choice for income-focused investors.
BRT is a real estate investment trust focused on acquiring existing multifamily properties and ground up development of multifamily apartments. The company recently crushed earnings estimates, and as a result, positive revisions for its upcoming quarters have started coming in. The stock has also moved about 40% higher over the past year and currently sits near its 52-week high, so this could be an option for investors looking to ride that momentum. Also, its status as a REIT means it pays out a massive 6.37% dividend.
4. Telekom Austria
Prior Close: $18.40
Telekom Austria is the principal provider of fixed, mobile, data and Internet services in Austria. This stock is unique on this list because of the company’s overall financial stability. TKAGY has an RoE of 15.5% and a net margin of 10%, and management is generating cash flow growth of 7.3%. This is all helping the company improve its top and bottom lines. Also, TKAGY offers a respectable 2.31% dividend. This stock is also an interesting momentum pick and has soared nearly 61% over the past year.
5. CVR Refining, LP
Prior Close: $14.80
CVR Refining is an independent MLP that operates crude oil transportation and storage facilities, along with a vast network of pipelines. The stock is currently sporting “A” grades for Value and Growth. With a P/E of 10.21 and a P/S of 0.40, CVRR is looking significantly undervalued in comparison to its industry peers. As an MLP, it returns most of its profits to shareholders and pays a whopping 25.41% dividend. Shares have surged nearly 50% over the past 12 weeks and have begun testing new 52-week highs, so this could be one for momentum investors to keep an eye on.
Famous Dave's owns, operates and franchises barbeque restaurants and blues clubs. Times have been tough for these types of restaurant chains, but Famous Dave’s is picking up steam. The company beat earnings estimates by 80% in the most recent quarter, and it has received several positive estimate revisions as a result. The stock has now gained about 30% in the past four weeks. Still, its P/S ratio of 0.50 implies that its revenue picture is being undervalued. Year-over-year sales comparisons will be tough, but the fundamental business is certainly still alive for Famous Dave’s right now.
7. Rosetta Stone Inc.
Prior Close: 12.75
Rosetta Stone is a leading provider of technology-based language learning solutions consisting of software, online services and audio practice tools. A series of better-than-expected earnings reports has helped the stock gain some momentum, and shares have now moved more than 22% higher over the past 12 weeks. Rosetta Stone is still in the red, but the company looks to improve its EPS figures by nearly 55% this fiscal year. That expansion is expected to continue next year, with current estimates calling for EPS to improve another 52% in the period. Overall, the stock is sporting an “A” grade for Growth and a “B” grade for Momentum.
In the midst of a transition to a marketplace-first focus, Groupon is looking to solidify a strong future for its business right now. Our current consensus estimates are calling for earnings growth to eclipse 229% by the end of fiscal 2017, and that expansion is expected to continue with EPS growth of 50% in the next fiscal year. The company is on the cusp of consistent profitability, and its revenue figures are already impressive. In fact, with a P/S ratio of 1.03, Groupon’s sales are clearly strong for a young tech company.
9. Westell Technologies Inc.
Prior Close: $3.87
Westell Technologies designs a broad range of digital and analog products used by telcos to deliver services, primarily over telephone wires. The stock jumps off the page because of its comparatively impressive P/E ratio of 16.83 and P/S ratio of 0.94. It’s also worth noting that Westell has crushed earnings estimates this year and is on pace to improve its EPS figures by nearly 200%. The stock has also gained more than 50% year-to-date, making it an intriguing pick for momentum investors.
10. Sucampo Pharmaceuticals, Inc.
Prior Close: $16.95
Sucampo is an emerging pharmaceutical company focused on drugs based on prostones, a class of compounds derived from functional fatty acids. The company is really interesting because of its cash flow. Right now, Sucampo is generating $2.41 in cash per share and growing its cash flow 106%, both of which significantly outpace their respective industry averages. The stock is also sporting a P/E ratio of 15.13, so it could be attractive to value investors. Overall, SCMP is rocking an “A” for Gowth, as well as an “A” grade in the weighted-average VGM category.
Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
Top 10 Stocks Under $20
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 a Zacks Rank #1 (Strong Buy), and a variety of other factors make these companies stand out as having strong upside potential.
1. American Eagle Outfitters, Inc. (AEO - Free Report)
Prior Close: $18.93
American Eagle Outfitters is a specialty retailer of casual apparel, accessories, and footwear for men and women between the ages of 16 and 34. The company has not been immune to the struggles of mall-based retailers, but shares are rebounding and have surged 30% in the past month. Still, the stock has a P/E of 16.38 and a P/S of 0.92, so investors could be undervaluing the strength of its revenues and profits. Moreover, there is still some expansion left for the brand, as earnings are projected to grow at an annualized rate of 8.74% over the next three to five years.
2. Deutsche Telekom AG (DTEGY - Free Report)
Prior Close: $17.84
Deutsche Telekom is Europe's largest communications company and is, with its T-Mobile subsidiary, one of the largest telecom firms in the world. The stock is currently sporting an “A” grade for Value and a “B” grade for Momentum in our Style Scores system. The company’s $4.14 per share cash flow nearly doubles its industry average, and its RoE of 10.95% further highlights its efficiency. DTEGY also pays out a 3.66% dividend, making it a viable choice for income-focused investors.
3. BRT Apartments Corp. (BRT - Free Report)
Prior Close: $11.30
BRT is a real estate investment trust focused on acquiring existing multifamily properties and ground up development of multifamily apartments. The company recently crushed earnings estimates, and as a result, positive revisions for its upcoming quarters have started coming in. The stock has also moved about 40% higher over the past year and currently sits near its 52-week high, so this could be an option for investors looking to ride that momentum. Also, its status as a REIT means it pays out a massive 6.37% dividend.
4. Telekom Austria
Prior Close: $18.40
Telekom Austria is the principal provider of fixed, mobile, data and Internet services in Austria. This stock is unique on this list because of the company’s overall financial stability. TKAGY has an RoE of 15.5% and a net margin of 10%, and management is generating cash flow growth of 7.3%. This is all helping the company improve its top and bottom lines. Also, TKAGY offers a respectable 2.31% dividend. This stock is also an interesting momentum pick and has soared nearly 61% over the past year.
5. CVR Refining, LP
Prior Close: $14.80
CVR Refining is an independent MLP that operates crude oil transportation and storage facilities, along with a vast network of pipelines. The stock is currently sporting “A” grades for Value and Growth. With a P/E of 10.21 and a P/S of 0.40, CVRR is looking significantly undervalued in comparison to its industry peers. As an MLP, it returns most of its profits to shareholders and pays a whopping 25.41% dividend. Shares have surged nearly 50% over the past 12 weeks and have begun testing new 52-week highs, so this could be one for momentum investors to keep an eye on.
6. Famous Dave’s of America, Inc. (DAVE - Free Report)
Prior Close: $6.55
Famous Dave's owns, operates and franchises barbeque restaurants and blues clubs. Times have been tough for these types of restaurant chains, but Famous Dave’s is picking up steam. The company beat earnings estimates by 80% in the most recent quarter, and it has received several positive estimate revisions as a result. The stock has now gained about 30% in the past four weeks. Still, its P/S ratio of 0.50 implies that its revenue picture is being undervalued. Year-over-year sales comparisons will be tough, but the fundamental business is certainly still alive for Famous Dave’s right now.
7. Rosetta Stone Inc.
Prior Close: 12.75
Rosetta Stone is a leading provider of technology-based language learning solutions consisting of software, online services and audio practice tools. A series of better-than-expected earnings reports has helped the stock gain some momentum, and shares have now moved more than 22% higher over the past 12 weeks. Rosetta Stone is still in the red, but the company looks to improve its EPS figures by nearly 55% this fiscal year. That expansion is expected to continue next year, with current estimates calling for EPS to improve another 52% in the period. Overall, the stock is sporting an “A” grade for Growth and a “B” grade for Momentum.
8. Groupon, Inc. (GRPN - Free Report)
Prior Close: $5.37
In the midst of a transition to a marketplace-first focus, Groupon is looking to solidify a strong future for its business right now. Our current consensus estimates are calling for earnings growth to eclipse 229% by the end of fiscal 2017, and that expansion is expected to continue with EPS growth of 50% in the next fiscal year. The company is on the cusp of consistent profitability, and its revenue figures are already impressive. In fact, with a P/S ratio of 1.03, Groupon’s sales are clearly strong for a young tech company.
9. Westell Technologies Inc.
Prior Close: $3.87
Westell Technologies designs a broad range of digital and analog products used by telcos to deliver services, primarily over telephone wires. The stock jumps off the page because of its comparatively impressive P/E ratio of 16.83 and P/S ratio of 0.94. It’s also worth noting that Westell has crushed earnings estimates this year and is on pace to improve its EPS figures by nearly 200%. The stock has also gained more than 50% year-to-date, making it an intriguing pick for momentum investors.
10. Sucampo Pharmaceuticals, Inc.
Prior Close: $16.95
Sucampo is an emerging pharmaceutical company focused on drugs based on prostones, a class of compounds derived from functional fatty acids. The company is really interesting because of its cash flow. Right now, Sucampo is generating $2.41 in cash per share and growing its cash flow 106%, both of which significantly outpace their respective industry averages. The stock is also sporting a P/E ratio of 15.13, so it could be attractive to value investors. Overall, SCMP is rocking an “A” for Gowth, as well as an “A” grade in the weighted-average VGM category.
Want more stock market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>