Investing

5 Stocks to Buy Trading Under $10 With Sensational Upside Potential

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While most of Wall Street focuses on large-cap 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 hundreds, all the way up to over $1,000 per share or more. At those steep prices, it is difficult 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 week we screen our 24/7 Wall St. research database looking for stocks rated Buy at major firms and priced under the $10 level. This week we found five new stocks that could provide investors with some solid upside potential.

With the number of new equity traders skyrocketing over the past year due to the Reddit/WallStreetBets popularity, locating good ideas to trade has become even more challenging. These five could all prove to be exciting additions for traders looking for solid alpha potential. While they are definitely better suited for aggressive investors, it is still important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Cerus

This little-known health care stock has been battered and offers an incredible entry point. Cerus Corp. (NASDAQ: CERS) engages in the research, development and manufacture of biomedical and surgical products. The company produces blood systems for platelets and plasma.

Cerus develops and markets the INTERCEPT Blood System and remains the only company in the blood transfusion space to earn both a CE Mark and FDA approval for pathogen reduction of both platelet and plasma components. The company currently markets and sells the INTERCEPT Blood System in the United States, Europe, the Middle East and elsewhere. The INTERCEPT Red Blood Cell system is in clinical development.

Stifel has a huge $10 price target on the shares. That compares to the lower Wall Street consensus target of $8.00. The shares dipped below the $6 level late in the week.

Kosmos Energy

This is a solid energy exploration and production play, and with oil and gas prices rising, it could be an outstanding idea now. Kosmos Energy Ltd. (NYSE: KOS) is a deepwater independent oil and gas exploration and production company focused along the Atlantic Margins. The company’s primary assets include production offshore Ghana, Equatorial Guinea and the U.S. Gulf of Mexico, as well as a gas development offshore Mauritania and Senegal. It also maintains a proven basin exploration program.

Kosmos Energy’s focus is on unlocking new hydrocarbon systems and growing and maturing discovered basins through follow-on exploration success, development and production.

The Goldman Sachs price target is $4.50 target, and the consensus target is $3.27. The stock has traded above $3 a share for the past week or so.


LiveXLive Media

This relatively unknown stock has some big-time upside potential. LiveXLIve Media Inc. (NASDAQ: LIVX) is a digital media company engaged in the acquisition, distribution and monetization of live music, internet radio, podcasting and music-related streaming and video content. It operates LiveXLive, a live music streaming platform, and Slacker Radio, a streaming music service, as well as produces original music-related content.

The company also produces, edits, curates and streams live music events through broadband transmission over the internet and satellite networks to its users. It provides digital internet radio and music services to users online and through original equipment manufacturers on a white label basis. It also offers ancillary products and services, such as regulatory and post-implementation support services.

The $8 Alliance Global target price is higher than the $7.07 consensus target. The shares have retreated from near $5 to less than $3.50 in the past month.

PennantPark Investment

This also could be an outstanding total return play and trade. PennantPark Investment (NASDAQ: PNNT) is a business development firm specializing in direct and mezzanine investments in middle-market companies. It invests in the form of mezzanine debt, senior secured loans and equity investments.

The firm invests in equity securities and debt transactions through preferred stock, common stock, warrants, options, subordinated loans, mezzanine loans and senior secured loans. It seeks to invest in companies based in the United States.

PennantPark seeks to invest between $10 million and $50 million in its portfolio companies. Its mezzanine loans, senior secured loans and other investments in its portfolio companies are between $15 million and $50 million. The firm also may make non-control equity and debt investments.

Investors receive a solid 8.42% dividend. The analysts at Truist Securities have set a $6 price target. The posted consensus target is $6.64, and the stock has traded above $5.50 for the past few weeks.

TrueCar

This is one of many companies helping to restyle the business of selling and marketing cars. TrueCar Inc. (NASDAQ: TRUE) is an internet-based information, technology and communication services company in the United States. It operates its platform on the TrueCar website and mobile applications.

The company’s platform enables users to obtain market-based pricing data on new and used cars, and to connect with its network of TrueCar certified dealers. The company also offers forecast and consulting services regarding determination of the residual value of an automobile at given future points in time, which are used to underwrite automotive loans and leases, and by financial institutions to measure exposure and risk across loan, lease and fleet portfolios.

Benchmark recently started coverage with an $8 price target. The consensus target is much lower $6.51, but the stock slipped below the $5 level late last week.


These are five stocks for aggressive investors looking 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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