Investing

Well-Known Companies Highlight Stocks to Buy Under $10 With Huge 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.

ADT

This top security company is a well-known protector of homes and businesses. ADT Inc. (NYSE: ADT) is the largest residential and second-largest commercial security monitoring company in North America. The company serves over 7 million customers, installing over a million systems per year. Roughly 94% of revenue is generated in the United States, with the remainder from Canada.

Google announced in August that it is buying a 6.6% stake in the home security firm for $450 million in a deal that will allow it to provide service to customers of its Nest home security devices. ADT said that the companies will work to combine Nest products like cameras, thermostats, doorbells and alarm systems with ADT’s installation, service and professional monitoring network.

The company began to offer certain Google devices to its customers last year, and it is expanding the integration in 2021.

Deutsche Bank has a $10 price target on the shares, which is near the $10.53 consensus target. ADT stock was trading near $8.50 a share on Friday.


BioDelivery Sciences

This small-cap pharmaceutical stock 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.

Last week the company reported solid earnings for fourth-quarter 2020 that exceeded the consensus estimates. The company recorded a loss of a penny per share in the year-ago period. The reported earnings include share-based compensation and certain other expenses. Excluding these items, adjusted earnings still beat the figure posted in the year-ago quarter.

Revenues totaled $42.2 million, up 33.5% from the year-ago period, and outpaced the consensus estimate. The uptick was mainly driven by higher sales of Belbuca and Symproic.

The Truist Securities price target is $7, also in line with the consensus target of $7.08. The shares have traded mostly above $4 in the past few weeks.

Southwestern Energy

This stock has risen nicely this year but still looks to have big upside potential. Southwestern Energy Co. (NYSE: SWN) is an independent energy company engaged in the exploration, development and production of natural gas, oil and natural gas liquids (NGLs) in the United States. It focuses on the development of unconventional natural gas and oil reservoirs located in Pennsylvania, Ohio and West Virginia.

As of December 31, 2020, it had approximately 217,296 net acres in northeast Appalachia and approximately 571,922 net acres in southwest Appalachia. The company’s estimated proved natural gas, oil and NGLs reserves comprise 11,990 billion cubic feet of natural gas equivalent (Bcfe) and 2,437 Bcfe of proved undeveloped reserves.

Southwestern Energy also engages in marketing and transportation of natural gas, oil and NGLs. It serves energy companies, utilities and industrial purchasers of natural gas.

Johnson Rice recently started coverage and set a $6.75 price target. The consensus target is $4.57, which is about where Southwestern Energy stock was trading late in the week.

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.

Trusit Securities posted $7 price target when it recently started coverage on the shares. The consensus target is in line at $7.01. The stock was trading above $5 a share in recent days.

Waitr

Food delivery has never been bigger than over the past year due to the pandemic, and the growth could potentially continue. Waitr Holdings Inc. (NASDAQ: WTRH) provides online food ordering and delivery services in the United States. Its Waitr Platform and Bite Squad Platform facilitate ordering of food and beverages by diners from restaurant partners for pick-up and delivery through a network of drivers.

Waitr recently announced it will be partnering with payment processing company Flow Payments to create a cannabis delivery and payment processing service for legal marijuana dispensaries. The partnership will create a platform combining Waitr’s delivery technology and resources with Flow Payments’ processing to facilitate the sale and delivery of cannabis where state and federal laws allow.

The $4 Deutsche Bank price target is less than the $5.75 consensus target. The share price was shy of $3 for much of the past 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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