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.
Ardelyx
This intriguing biotech play has some solid Phase 3 candidates. Ardelyx Inc. (NASDAQ: ARDX) is a biopharmaceutical company that develops and sells medicines for the treatment of kidney and cardiorenal diseases in the United States and internationally.
The company’s lead product candidate is tenapanor, which has completed a late-stage clinical trial for the treatment of patients with irritable bowel syndrome with constipation, as well in Phase 3 clinical trial for the treatment of hyperphosphatemia in end-stage renal disease patients on dialysis.
Ardelyx’s RDX013 is a small molecule potassium secretagogue program that is in Phase 2 clinical trial for the treatment of patients with hyperkalemia. Its RDX020 is a small molecule program for the treatment of metabolic acidosis.
Wedbush’s Outperform rating comes with a gigantic $14 price target. The consensus target is slightly lower at $13.86, and shares have been trading just above $6 recently.
Babcock & Wilcox
This stock recently caught an upgrade and has performed well this year. Babcock & Wilcox Enterprises Inc. (NYSE: BW) provides energy and environmental technologies and services for the power and industrial markets worldwide. The company operates through three segments.
The Renewable segment offers technologies for waste-to-energy and biomass energy systems, as well as black liquor systems for the pulp and paper industry. This segment provides technologies to support solutions for diverting waste from landfills to use for power generation and replacing fossil fuels while recovering metals and reducing emissions.
Its Environmental segment offers a range of emissions control and environmental technology solutions for utility, waste to energy, biomass, carbon black and industrial steam generation applications. This segment provides systems for cooling, ash handling, particulate control, nitrogen oxides and sulfur dioxides removal, chemical looping for carbon control, and mercury control.
The Thermal segment offers steam generation equipment and aftermarket parts, as well as construction, maintenance and field services for plants in the power generation, oil and gas and industrial industries. This segment has installed equipment for utilities and general industrial applications, including refining, petrochemical, food processing, metals and others.
D.A. Davidson has upgraded the stock to Buy and has a $10 price target, which is well above the $7.58 consensus target. The stock has had a nice run recently but has yet to break through resistance at $8.00.
Calumet Specialty Products
With oil prices rising this company may be poised to benefit. Calumet Specialty Products L.P. (NASDAQ: CLMT) produces and sells specialty hydrocarbon products in North America and internationally.
Its Specialty Products segment offers various lubricating oils, white mineral oils, solvents, petrolatums, waxes, synthetic lubricants and other products that are used primarily as raw material components for basic industrial, consumer and automotive goods.
The company’s Fuel Products segment provides fuel and fuel-related products, including gasoline, diesel, jet fuel, asphalt and heavy fuel oils, as well as resells purchased crude oil to third party customers. Calumet GP serves as the general partner for Calumet Specialty Products Partners.
The $8 Wells Fargo price target compares with a $5.00 consensus target. Calumet Specialty Products stock hit a 52-week high of $6.41 this week.
Leaf
This company could benefit from the stimulus payments being sent out. Leaf Group Ltd. (NASDAQ: LEAF) operates as a diversified consumer internet company worldwide.
Its Marketplaces segment offers Society6.com, which provides artists with an online commerce platform to feature and sell their original art and designs on consumer products in the wall art, home decor and tech and apparel accessories categories. It also provides SaatchiArt.com and its related art fair event brand, which is an online art gallery where a global community of artists exhibit and sell their original artwork directly to consumers.
The Media segment offers Well+Good, a health and wellness media brand that offers a journalistic approach to content, and Livestrong.com, a destination and action-oriented community. It also has mobile applications, such as MyPlate, which monitors user health, fitness and life achievements.
This segment also provides Hunker, a home design media site for enabling first-time homeowners enhance their homes with practical solutions, home tours. and design advice for people. Only In Your State is a U.S.-focused local attractions and review site that highlights small businesses, hidden gems and natural wonders for the audience. In addition, this segment offers content creation, traffic source, mobile application and monetization services, and it develops partner sites.
The BTIG Research price target is $9, and the consensus target is $8.67. After shares hit a 52-week high of $8.85 last week, they pulled back to less than $7.
Pacific Mercantile Bancorp
Rising interest rates are good for bank stocks, and this could be a solid play. Pacific Mercantile Bancorp (NASDAQ: PMBC) is a holding company for the Pacific Mercantile Bank, which provides a range of commercial banking products and services to middle-market businesses, professional firms and individuals.
Its deposit products include checking accounts, interest-bearing term deposit accounts, savings and money market deposits, and time deposits. It also offers various loan products, such as commercial loans and credit lines, accounts receivable and inventory financing, small business administration guaranteed business loans, owner-occupied commercial real estate loans, working capital lines of credit and asset-based lending, growth capital loans, equipment financing, letters of credit and corporate credit cards.
The company provides cash and treasury management solutions, automated clearing house payment and wire solutions, fraud protection services, remote deposit capture services, courier services and online banking services, and it offers import/export financing services.
Keefe Bruyette has set a $12 price target, while the consensus target is $10.50. This stock also hit a 52-week high last week, at $9.40 a share.
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.
Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE
Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.