Investing

5 Stocks to Buy Priced Below $10 With Monster 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. Often 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.

Each and every week, we screen our 24/7 Wall St. research database looking for stocks rated Buy at major firms and priced under the $10 level (last week’s picks included Zynga), and this week was no exception. We found five more stocks that could provide investors with some solid upside potential. While more suited for aggressive accounts, they could prove exciting additions to portfolios looking for solid alpha potential.

Agile Therapeutics

This a microcap medical company with huge upside to the target price. Agile Therapeutics Inc. (NASDAQ: AGRX) is a health care company that engages in the development and commercialization of a transdermal patch. Its lead product candidate, Twirla, also known as AG200-15, is an investigational low-dose, nondaily prescription contraceptive.

The company announced last month that it resubmitted to the U.S. Food and Drug Administration (FDA) a new drug application for Twirla in response to a December 2017 complete response letter from the FDA that identified deficiencies relating to quality control adhesion test methods for the Twirla manufacturing process and observations identified during an inspection of a facility of a third-party manufacturer for the Twirla NDA that must be resolved.

The resubmitted application includes the results from a comparative study that was conducted at the request of the FDA to address the agency’s questions on in vivo adhesion, additional information on the company’s manufacturing process and other analyses responding to the 2017 letter.

Oppenheimer has an Outperform rating and a gigantic $5 price target for the shares, and that compares to the Wall Street consensus target of $3.50. The shares traded on Friday’s close at $1.13.

CannTrust

This company could be an off-the-radar play for investors looking for a marijuana pick with lower name recognition. CannTrust Holdings Inc. (NYSE: CTST) produces and distributes pharmaceutical grade medical cannabis products in Canada. It sells dried cannabis and oil extractions to the client based on the medication document provided by health care practitioner. The company has a partnership with Gold Coast University Hospital.

CannTrust also focuses on developing nanotechnology to create new products in the medical, recreational, beauty, wellness and pet markets. In addition, the company recently completed a successful secondary offering, and management noted in late April it expects to report a strong first quarter.

BMO started coverage on the shares recently with an $11 price target. The shares were trading at $5.25 on Friday’s close.

Himax Technologies

Shares of this micro-cap technology company have solid upside potential. Himax Technologies Inc. (NASDAQ: HIMX) engages in the development and trade of semiconductors. It operates through the Driver Integrated Circuit and Non-Driver Products segments. Its products include display drivers, timing controllers, wafer level optics, video and display technology solutions, liquid crystal over silicon devices, complementary metal-oxide semiconductor image sensors and power integrated circuits.

The company recently launched its flexible OLED automotive display driver and timing controller for BOE Technology, China’s largest display manufacturer. Compared to traditional TFT LCD displays, OLED displays’ superior image quality, light weight, slim design and form factor advantage, have contributed to its increasing penetration in the smartphone market over past few years.

With more OLED capacity becoming available, OLED displays are gaining traction in the automotive market as they provide better display performance and greater design flexibility to attract more consumers. The commercialization of flexible OLED displays has further enabled automotive makers to create a design revolution in cars that is not limited only to the dashboard and the center console.

The $5 Roth Capital price target compares with a $3.62 consensus target. The shares last traded at $3.36 apiece.

Northern Oil and Gas

The Stifel analysts remain very positive on this small-cap energy play. Northern Oil and Gas Inc. (NYSE: NOG) is engaged in the acquisition, exploration, development and production of oil and natural gas properties, primarily in the Bakken and Three Forks formations within the Williston Basin in North Dakota and Montana. The company is the largest non-operator in that Basin.

The company announced in April that it purchase additional Williston Basin properties from VEN Bakken for $165 million in cash, a $130-million 6% three-year senior unsecured note due 2022 and 5.6-million Northern Oil and Gas common shares. The newly divested assets are estimated to produce 6,600 barrels of oil equivalent per day in the second half of 2019 and generate $44.9 million in cash flow from operations. Capital expenditure budget in the second half of the year is projected at $15.6 million.

Stifel is very bullish and has a $6.60 price target. The posted consensus target is $4.98, and the stock ended the week at $2.01 on Friday.

Sientra

This stock has been blitzed over the past year, and it offers aggressive accounts a timely entry point. Sientra Inc. (NASDAQ: SIEN) as a medical aesthetics company that engages in developing and commercializing plastic surgery implantable devices. It operates through two reportable segments.

The Breast Products segment focuses on sales of its breast implants, tissue expanders and scar management products under the brands Sientra, AlloX2, Dermaspan, Softspan and Biocorneum. The miraDry segment focuses on sales of the miraDry System, consisting of a console and a handheld device that uses consumable single-use bioTips to reduce underarm perspiration.

Wells Fargo has set a $10 price target on the shares, but the consensus figure is much higher at $17.75. Shares were trading hands most recently at $6.27.

Five stocks for aggressive accounts that look to get share count leverage on companies that have sizable upside potential. While not suited 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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