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. Streamline Health Solutions (STRM - Free Report)
Prior Close: $1.46
Streamline Health Solutions is a leading supplier of workflow and document management tools to the healthcare industry. The stock is a strong growth pick, with full-year EPS expected to improve by nearly 39%. STRM could also interest momentum investors, as shares have gained more than 37% in just 12 weeks. After meeting or surpassing earnings estimates in three consecutive quarters, this stock could be taking off. Even still, with a P/S ratio of just 1.21, the stock could be undervalued based on its total revenues.
2. JSR Corp. (JSCPY - Free Report)
Prior Close: $18.06
JSR Corp. engages in the manufacture and sale of synthetic rubber and chemical materials. This Tokyo-based company is showing signs of being undervalued, as its P/E ratio of 13.89 and P/S ratio of 1.11 are both well below its respective industry averages. JSR is also expected to improve its EPS figures by 13% this year, on the back of respectable 4.4% sales growth. The company appears to be a strong pick in our “Chemical – Plastic” group, which currently sits in the top 15% of the Zacks Industry Rank.
3. Konica Minolta (KNCAY - Free Report)
Prior Close: $16.96
Konica Minolta is engaged in the manufacture and sale of imaging products including printers, lenses, and display materials. With a P/E ratio of 14.74, a P/S ratio of 0.48, and a P/B ratio of 0.88, KNCAY is showing strong signs of being undervalued right now. The stock is also sporting a beta rating of just 0.73, which means that it should hypothetically be less volatile than the market average. Overall, the company is sporting a VGM grade of “B,” which pairs well with its strong Zacks Rank and solid valuation metrics.
4. AeroCentury Corp. (ACY - Free Report)
Prior Close: $13.77
AeroCentury is an operating lessor and finance company which specializes in leasing used turboprop aircraft and engines. ACY has a P/E ratio of 7.83, which is better than the market and industry average, and its P/B ratio of 0.48 and P/S ratio of 0.65 provide more evidence that shares are undervalued right now. The company has also been a solid momentum pick this year, as shares have gained nearly 47% in 2017 alone. Earnings estimates have been trending higher, so investors should look for share prices to continue to follow suit in the near future.
5. Daktronics, Inc. (DAKT - Free Report)
Prior Close: $10.50
Daktronics is one of the world's largest suppliers of electronic scoreboards, computer-programmable displays, and large screen video displays. The company boasts a “B” grade for Value and a better-than-industry average P/S ratio, but it is also an interesting growth pick. Based on current consensus estimates, we expect DAKT to record EPS growth of 61% this year. The company is also growing its cash flow at a rate of 52%, furthering highlighting its improving financial position. Daktronics also offers a respectable 2.67% dividend.
6. South32 Ltd. (SOUHY - Free Report)
Price Close: $12.53
South32 is a natural resources company which primarily produces alumina, aluminum, coal, manganese, nickel, silver, lead and zinc. The “Mining – Miscellaneous” group is in the top 14% of the Zacks Industry Rank and heating up, and South32 has been one of its strongest stocks this year. What’s more, the company is sporting an overall VGM grade of “A” and shows strong valuation and growth metrics. Investors should look for South32 to post EPS growth of 32% this year, and management is generating cash flow growth of nearly 110% right now. What’s more, with a 3.67% dividend, this stock is also a strong income play.
7. Zumiez Inc. (ZUMZ - Free Report)
Prior Close: $17.40
Zumiez is a leading specialty retailer of action sports related apparel, footwear, equipment and accessories. Retail’s woes have been well documented, but Zumiez sticks out from its “Retail - Apparel and Shoes” group for several reasons. First of all, it is expected to improve its top and bottom line this fiscal year, while the industry as a whole will likely see earnings and revenue slumps. Also, its earnings estimates have been moving higher, and shares have responded by gaining nearly 40% over the past 12 weeks. The stock is also sporting an overall VGM grade of “A.”
8. Telekom Austria (TKAGY - Free Report)
Prior Close: $18.72
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 2.27% dividend. This stock is also an interesting momentum pick and has soared nearly 64% over the past year.
9. JA Solar Holdings (JASO - Free Report)
Prior Close: $7.42
JA Solar is a manufacturer of high-performance solar cells that are sold to solar module manufacturers. Valuation metrics are showing that JASO shares may be undervalued right now, and the company is an unusually healthy solar industry play. JA Solar is generating $4.78 per share in cash, which is well ahead of the industry average. What’s more, the company’s RoE of 7.9% outpaces the industry average. And after three consecutive earnings beats, the stock has soared nearly 60% this year and will look to continue that strong momentum through Q3 earnings season.
10. Santander Consumer USA (SC - Free Report)
Prior Close: $15.37
Santander is a technology-driven consumer finance company which focused on vehicle finance and unsecured consumer lending products. With a P/E ratio of 9.18 and a P/S ratio of 0.84, SC is showing signs of being undervalued. On top of this, the company is generating cash flow growth of 13.6%, and its RoE and net margin are both better than its respective industry averages. Earnings estimates are rising, and shares are responding. The stock has now gained more than 14% over the last 12 weeks and could start attracting momentum investors.
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