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.
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Many investors, especially more aggressive traders, look at lower-priced stocks as a way not only to 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.
Goldman Sachs is the premier investment bank in the world, so we screened its outstanding research database and found five stocks trading under the $10 level that could provide investors with upside potential ranging from over 10% to 70%. For those leery of low-priced shares, just remember that Amazon and Apple at one time traded in the single digits. Zynga, a stock we have featured over the years, recently was purchased by Take-Two Interactive Software.
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While all five are rated Buy at Goldman Sachs, they are much better suited for very aggressive investors. It also is 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 | ADT Price Prediction) 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 last year that it was 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 Goldman Sachs price target of $12 compares with the $10.04 consensus target. ADT stock closed on Friday at $7.46 per share. Hitting the Goldman Sachs target would be a 60% gain.
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Angi
Shares of this popular home services company have been crushed and have huge upside potential. Angi Inc. (NASDAQ: ANGI) connects home service professionals with consumers in the United States and internationally.
The Angi Ads business connects consumers with service professionals for local services through the Angi nationwide online directory of service professionals in various service categories. It provides consumers with valuable tools, services and content, including verified reviews, to help them research, shop and hire for local services, and it sells term-based website and mobile and digital magazine advertising to service professionals, as well as provides quoting, invoicing and payment services.
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The company also owns and operates Angi Leads digital marketplace service, which connects consumers with service professionals for home repair, maintenance and improvement projects; offers consumers with tools and resources to find local, pre-screened and customer-rated service professionals, as well as online appointment booking; and connects consumers with service professionals by telephone and home services-related resources.
Angi also operates Handy, a platform for household services, primarily cleaning and repair services; Angi Roofing, which provides roof replacement and repair services; and home services marketplaces under the Travaux, MyHammer, Werkspot, MyBuilder and Instapro names.
Goldman Sachs has a $9 price target for Angi stock. The consensus target is higher at $9.68, and shares closed at $5.45 on Friday. Hitting the Goldman Sachs target would be about a 60% gain.
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GoodRx
This company has used relentless television advertising to gain market share. GoodRx Holdings Inc. (NASDAQ: GDRX) offers information and tools that enable consumers to compare prices and save on their prescription drug purchases in the United States.
The company operates a price comparison platform that provides consumers with curated, geographically relevant prescription pricing and access to negotiated prices through GoodRx codes that are used to save money on prescriptions across the United States.
GoodRx also offers other health care products and services, including subscriptions, pharma manufacturer solutions and telehealth services. It serves pharmacy benefit managers that manage formularies and prescription transactions, including establishing pricing between consumers and pharmacies.
The Goldman Sachs price target is $12, and the consensus target for GoodRx stock is $12.24. Friday’s final trade was for $7.58 a share. Hitting the Goldman Sachs target would be a 50% or so gain.
Infinera
Some feel that this top company would be an outstanding addition to a networking giant as a takeover candidate. Infinera Corp. (NASDAQ: INFN) provides Intelligent Transport Networks, enabling carriers, cloud operators, governments and enterprises to scale network bandwidth, accelerate service innovation and simplify optical network operations.
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Infinera’s portfolio of solutions includes optical transport platforms, converged packet-optical transport platforms, optical line systems, router platforms and a suite of networking and automation software offerings.
In 2020, Infinera and Windstream completed a live network trial that successfully achieved 800G single-wavelength transmission over 730 km across Windstream’s long-haul network between San Diego and Phoenix. The results of the trial mark a major milestone in optical networking by demonstrating that ultra-high-speed optical transmissions, such as 700G and 800G, powered by Infinera’s ICE6 optical engine and Windstream’s high-performance fiber network, can be deployed in real-world network applications over significant distances.
The $10 Goldman Sachs price objective compares to a $9.30 consensus target. Infinera stock last traded on Friday at $5.73. Hitting the Goldman Sachs target would be a 72% or so gain.
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Kosmos Energy
This stock is a solid energy exploration and production play, and with oil and gas prices near all-time highs, this 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 target price on Kosmos Energy stock at Goldman Sachs is $9.50. The consensus target is lower at $5.20. The stock closed at $8.40 on Friday. Hitting the Goldman Sachs target would be a gain of about 13%.
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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, they are not penny stocks with absolutely no track record or liquidity, and major Wall Street firms have research coverage.
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