Investing

5 Sizzling New Stocks Trading Under $10 With Gigantic Upside Potential

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While most of Wall Street focuses on large and mega cap stocks, as they provide a degree of safety and liquidity, many investors are limited in the number of shares they can buy. Many of the biggest public companies, especially the technology giants, trade in the low-to-mid hundreds, all the way up to over $1,000 per share. At those steep prices, it’s pretty hard to get any decent share count leverage.

Many investors, especially more aggressive traders, look at lower-priced stocks as a way to not only make some good money but to get a higher share count. That can really help the decision-making process, especially when you are on to a winner, as you can always sell half and keep half.

Every week we screen our 24/7 Wall St. research database looking for stocks covered by top Wall Street analysts that trade under the $10 level and could provide investors with some solid upside potential. While much more suited for aggressive accounts, they could prove exciting additions to portfolios looking for solid alpha potential.

BioDelivery Sciences

This small-cap pharmaceutical company has massive implied upside potential. BioDelivery Sciences International Inc. (NASDAQ: BDSI) engages in the development and commercialization of new applications of approved therapeutics to address important unmet medical needs. It focuses on pharmaceutical products in the areas of pain management and addiction.

The company recently licensed full rights to commercialize Symproic in the United States. Symproic is an oral tablet that functions as a peripherally acting mu-opioid receptor antagonist medication indicated in the United States for the treatment of opioid-induced constipation in adult patients with chronic noncancer pain, including patients with chronic pain related to prior cancer or its treatment who do not require frequent (e.g., weekly) opioid dosage escalation.

SunTrust Robinson Humphrey has a Buy rating and an $8 price target on the shares. The Wall Street consensus target is $7.38, and shares were trading most recently at $4.65.

Forum Energy Technologies

Shares of this lesser-known company have solid upside potential. Forum Energy Technologies Inc. (NYSE: FET) is a global oilfield products company, serving the subsea, drilling, completion, production and infrastructure segments of the oil and natural gas industry.

The company’s products include highly engineered capital equipment, as well as products that are consumed in the drilling, well construction, production and transportation of oil and natural gas. It is among companies that will benefit from an uptick in spending going forward as oil prices have risen sharply.

The Jefferies Buy rating comes with a $7 price target, while the consensus across $6.73. Shares closed trading at $5.29.

HighPoint Resources

Investors looking for a small cap energy play will love this independent oil and gas company. HighPoint Resources Corp. (NYSE: HPR) engages in the exploration, development and production of oil, natural gas and natural gas liquids. It primarily holds interests in the Denver-Julesburg Basin in Colorado’s eastern plains and parts of southeastern Wyoming.

HighPoint maintains a conservative approach to proved reserve bookings and only included approximately 220 gross proved undeveloped locations at year-end 2018, of which approximately 60 gross proved undeveloped locations represent wells that are in various stages of drilling and completion activity. This amounts to approximately 1.5 years of future development activity at the current planned development pace.

Stifel is very positive on the shares, with a Buy rating and a huge $11 price target. The consensus target was last seen at $5.39. Shares ended the week at $2.77.

SRC Energy

This small-cap company could be a great bolt-on addition for a larger firm. SRC Energy Inc. (NYSE: SRCI) is an independent oil and natural gas company engaged in the acquisition, development and production of crude oil and natural gas in and around the Denver-Julesburg Basin. This Basin generally extends from the Denver metropolitan area throughout northeast Colorado into Wyoming, Nebraska, and Kansas.

As of December 31, 2018, the company had net proved oil and natural gas reserves of 88 million barrels of oil and condensate, 771.9 billion cubic feet of natural gas and 89.1 million barrels of natural gas liquids, and it operated 985 net producing wells, as well as had 95,200 gross and 86,200 net acres under lease, in the Wattenberg Field.

Cowen recently initiated coverage on the shares with an $8 price target. The consensus target is $8.17, and shares were last seen at $6.44.

Vonage

This stock has been in and out of the investors’ doghouse for years. Vonage Holdings Corp. (NYSE: VG) is a provider of cloud communications services for businesses and consumers offering solutions across multiple devices.

For business services customers, Vonage provides cloud-based unified communications as a service solutions, consisting of integrated voice, text, video, data, collaboration and mobile applications over its scalable session initiation protocol based voice over Internet protocol (VoIP) network.

Through its cloud-based middleware solution, the company provides customers the ability to integrate its cloud communications platform with various cloud-based productivity and customer relationship management solutions, including Google’s G Suite, Zendesk, Salesforce.com Sales Cloud, Oracle and Clio.

Baird’s price target is $15, near the $14.95 consensus estimate. Shares traded most recently at $9.30 apiece.

These are five stocks with sizable upside potential for very aggressive accounts looking to get share-count leverage. While not suitable for all investors, these are not penny stocks with absolutely no track record or liquidity, and major Wall Street firms have research coverage.

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