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.
Finvolution
This off-the-radar stock has exploded higher but looks to have even more upside potential. Finvolution Group (NYSE: FINV) is an investment holding company that operates in the online consumer finance industry in the People’s Republic of China. It is a fintech platform that connects underserved individual borrowers with financial institutions.
The company’s platform provides standard and other loan products. As of June 30, 2020, it had approximately 110.4 million cumulative registered users. The company was formerly known as PPDAI and changed its name in November 2019.
Credit Suisse has an $11.60 price target on the shares, and the Wall Street consensus target is just $6.73. The stock had a strong move earlier this month, and the shares were trading around $8.00 last week.
Infinity Pharmaceuticals
This is one for traders seeking a health care play. Infinity Pharmaceutical Inc. (NASDAQ: INFI) is a biopharmaceutical company that focuses on developing novel medicines for people with cancer.
It offers IPI-549, an orally administered, clinical-stage, immuno-oncology product candidate that selectively inhibits the enzyme phosphoinositide-3-kinase-gamma. Its product candidate IPI-549 is an orally administered clinical-stage immuno-oncology product candidate that inhibits the enzyme phosphoinositide-3-kinase-gamma (PI3K-gamma), which is in Phase 1/1b clinical study.
The company has strategic alliances with the following:
- Intellikine, to discover, develop and commercialize pharmaceutical products targeting the delta or gamma isoforms of PI3K
- Verastem, to research, develop, commercialize and manufacture duvelisib and products containing duvelisib, as well as duvelisib program for patients with relapsed or refractory chronic lymphocytic leukemia or small lymphocytic lymphoma
- PellePharm, to develop and commercialize rights to its hedgehog inhibitor program, IPI-926, a clinical-stage product candidate
It also has collaboration agreements with Arcus Biosciences, F. Hoffmann-La Roche and Bristol-Myers Squibb.
The Truist Securities price target is a massive $12, while the consensus target is down at $7.60. The shares were trading over $3.50 late in the week.
NewAge
The marijuana industry is also focused on infused products and this is a solid play. NewAge Inc. (NASDAQ: NBEV) engages in the development and commercialization of a portfolio of beverages. It operates through the following segments.
The Noni by NewAge segment focuses on the development, manufacturing and marketing of Tahitian Noni Juice, MAX and other noni beverages, as well as other nutritional, cosmetic and personal care products. The NewAge segment markets and sells a portfolio of healthy beverage brands, including XingTea, Marley, Búcha Live Kombucha, Coco-Libre, Evian, Nestea, Illy Coffee and Volvi.
The $5 Alliance Global price target is the same as the consensus figure. The shares have traded just north of the $3 level recently.
Savara
This rather unknown stock could have some massive upside for aggressive traders. Savara Inc. (NASDAQ: SVRA) is a clinical-stage pharmaceutical company focused on the development and commercialization of novel therapies for the treatment of patients with rare respiratory diseases.
Its pipeline includes the following:
- AeroVanc is an inhaled formulation of vancomycin, which the company is developing for the treatment of persistent methicillin-resistant Staphylococcus aureus lung infection in cystic fibrosis patients.
- Molgradex is an inhaled formulation of recombinant human granulocyte-macrophage colony-stimulating factor. The company is developing Molgradex for the treatment of autoimmune pulmonary alveolar proteinosis, a rare lung disease.
- AIR001 is a sodium nitrite solution for inhalation via nebulization that is in Phase 2 clinical development for the treatment of heart failure with preserved ejection fraction, also known as diastolic heart failure or heart failure with preserved systolic function.
Piper Sandler analysts have set a massive $7 price target. That compares with the much lower $3.80 consensus target and the $2 or so recent share price.
Strongbridge
This is another biotech play with huge upside potential. Strongbridge Biopharma PLC (NASDAQ: SBBP) is a commercial-stage biopharmaceutical company focused on the development and commercialization of therapies for rare diseases with unmet needs in the United States.
The company offers Keveyis, an oral carbonic anhydrase inhibitor to treat hyperkalemic, hypokalemic and related variants of primary periodic paralysis. Its clinical-stage product candidates include Recorlev, a cortisol synthesis inhibitor, which is in Phase 3 clinical trials for the treatment of endogenous Cushing’s syndrome. Veldoreotide is a somatostatin analog that has completed Phase 2 clinical trial for the treatment of acromegaly.
Oppenheimer’s price objective is a huge $8, which is the same as the consensus estimate. The stock has been volatile recently and was trading near $3.40 on Friday.
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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