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 three stocks that fall into the broad “technology” sector. Each of these three stocks is currently trading for less than $10 per share and holds a Zacks Rank #1 (Strong Buy). Take a look at the strong estimate revision activity and other factors that make these companies stick out right now:
1. Kemet Corp. (KEM - Free Report)
Prior Close: $5.02
Kemet Corporation is the world's largest manufacturer of solid tantalum capacitors and one of the world's largest manufacturer of multilayer ceramic capacitors. The stock has proven to hold solid fundamental metrics, which is reflected in its “A” grades for Value and Growth, as well as its overall VGM score of “A.”
Shares of KEM have gained over 100% year-to-date thanks to its impressive earnings growth. In the most recent quarter, Kemet posted an earnings surprise which beat the Zacks Consensus Estimate by 175% and represented EPS growth of 500%, and for the current-quarter our consensus estimate implies EPS growth of over 215%.
2. On Track Innovations (OTIV - Free Report)
Prior Close: $1.26
On Track Innovations is a global leader in contactless microprocessor systems for use in cashless, mobile, IoT, and wearable payment solutions. With shares up over 20% in the last 12 weeks, On Track has become one of the hottest momentum stocks in this growing industry, and it also holds an “A” grade for Value.
Last quarter, the company was able to post an earnings beat and a surprise profit, and a pair of positive estimate revisions over the last 30 days has moved its current-quarter Zacks Consensus Estimate to break-even. Besides its strong momentum, value, and estimate revision stats, On Track also falls into the strong Electronics-Semiconductors business that lies in the top 17% of the Zacks Industry Rank.
3. Lantronix Inc. (LTRX - Free Report)
Prior Close: $1.44
Lantronix is a developer of networking products and offsite device controls for use in the enterprise and industrial Internet of Things. The company has produced a solid year of earnings performance, with its EPS beating the Zacks Consensus Estimate by an average of 65.83% in each of the trailing four quarters.
Lantronix has also shown solid estimate revision activity recently, as its current-quarter Zacks Consensus Estimate has gained a penny over the last 30 days, and its full-year earnings estimate has gained four cents in that time. The company looks poised to continue its solid earnings performance, which should give it an edge in this up-and-coming tech market.
A stock’s market price is not a clear indicator of whether it is a good investment. However, the nice thing about the Zacks Rank is that it can be applied to stocks of any price. All of the stocks highlighted here hold a Zacks Rank #1 (Strong Buy) rankings, while also possessing other qualities that help them stick out. For smaller investors looking to find solid tech stocks at lower prices, this list is a great place to start.
Stocks that Aren't in the News. Yet.
You are invited to download the full, up-to-the-minute list of 220 Zacks Rank #1 "Strong Buys" free of charge. Many of these companies are almost unheard of by the general public and just starting to get noticed by Wall Street. They have been pinpointed by the Zacks system that nearly tripled the market from 1988 through 2015 with a stellar average gain of +26% per year. See these high-potential stocks free >>