Investors can be confused by companies such as Amazon (AMZN), Alphabet (GOOG, GOOGL), and even Chipotle (CMG). These reputable companies sell for $ 1,765, $ 1,300, and $ 750 per share, respectively.
While these stocks have a long history of stable returns and huge upside potential, they may not be a viable first investment for those just starting out. Cheap under $ 10, they offer both learning opportunities and huge growth potential.
There is also something exciting when investing in cheap stocks. It seems that everyone can find several companies whose stocks will really skyrocket, making incredible profits in a month or a year.
Many of these companies are very unstable and for good reason. Some even deserve to fall further into the abyss.
Such cheap stocks are often cannabis or biotech games based on hot market or drug concepts still awaiting FDA approval.
Many of these companies' shares will fall, some will soar.
When analyzing cheap stocks to buy, it's important to look beyond price alone. Important: Which company? What is its growth and profit potential in the coming years? How does Wall Street feel?
The following 10 stocks have strong buy consensus ratings and price targets that suggest more than 20% growth from their current prices. These are cheap stocks with rich goals for the future.
AMC Entertainment (AMC)
You may be surprised to see AMC Entertainment (NYSE: AMC) on this list of stocks to buy. Over the past five years, the company has dropped from highs around $ 35 to under $ 10. And this is not so surprising.
Personally, I haven't been to the cinema for over a year – why should I? Instead of spending $ 13 or $ 14 on a separate movie ticket, I could spend the same amount on a monthly streaming service from Netflix (NASDAQ: NFLX), Disney (NYSE: DIS), or Apple. Many Americans feel the same way. New film releases, with the possible exception of films about the Star Wars and Marvel franchises, are not as exciting as they used to be. Plus streaming services offer their own original movies – and many of them really deserve respect.
Research shows that cinemas and traditional Hollywood companies have a long history of coping with instability and economic downturn. During the Great Depression, good movies and musicals prevailed in Hollywood and on Broadway. And during the financial crisis of 2008-2009, the film industry experienced an unprecedented rise in box office receipts. Martin Kaplan of the University of Southern California put it simply. “This is not rocket science,” Kaplan told the New York Times in 2009. "People want to forget their problems and they want to be with other people."
When people want to forget about their problems, going to the movies with friends will provide more peace of mind than being alone and watching Netflix content.
12-month target price of $ 15.57. Implies upside potential for AMC stocks of just over 60%.
If you anticipate an impending global recession, AMC Entertainment stock offers some security and an 8.7% dividend yield. AMC Stock is a great cheap buy.
Boingo Wireless (WIFI)
From further research I can understand why analysts have a consensus 12-month target price implying Increase in share price by 75%.
What is Boingo Wireless? Well, the company is acquiring long-term wireless rights for large facilities, including airports, military bases, and universities. With these rights, he monetizes the networks through advertising and fees.
In 2018, Boingo acquired Elauwit, a Wi-Fi provider for 220 US student housing properties. At the time, Boingo CEO David Hagan saw the deal as an opportunity to grow into multi-unit and student housing services.
In 2018, the company won a contract with the New York Metropolitan Transit Authority for two major projects. These projects consisted of the design, construction and operation of wireless services for two parts of the New York transit system. These are the largest contracts of the company to date.
While Boingo Wireless has sank from its all-time highs, it is clear that there are big projects and great growth potential in its future. The stock of WIFI will grow as it grows in student housing and transit. This is especially true given that DC and other cities continue to roll out WiFi in their stations. Wall Street agrees – stocks are up 30% in the past month.
Plug Power (PLUG)
Contrary to some of the names on this list, Plug Power (NASDAQ: PLUG) stock has actually surged to 130% YTD. It now costs about $ 2.85, but analysts believe it could rise to $ 3.90 next year.
This is still over 30%.
Plug Power manufactures and develops hydrogen fuel cell systems that replace conventional batteries. Basically, traditional batteries take several hours to recharge, PLUG systems charge in minutes. The company's hydrogen fuel cells are used in forklift trucks and are attracting customers such as Nike (NYSE: NKE), Home Depot (NYSE: HD) and Walmart (NYSE: WMT).
In 2017, PLUG stock surpassed $ 3 for the third time, a key resistance level. In April of that year, Amazon (NASDAQ: AMZN) acquired more than 50 million shares of Plug Power, agreeing to use fuel cell technology in its warehouses. It has been a good month for PLUG.
Since then, Plug Power has reached the $ 3 level again. Analysts, however, believe that the company's shares may again exceed $ 3.
As automakers are increasingly interested in the company's products, Plug Power's customer base will continue to grow as hydrogen fuel cells become more popular. When this happens, the growth of PLUG shares will not be slow.
The Meet Group (MEET)
Dating apps are now commonplace. It's not uncommon for couples to find themselves in long-term relationships and even marriages, after one or two coincidences on their favorite platform. That's where The Meet Group (NASDAQ: MEET) comes in. The company operates so-called people-to-people apps under brands such as MeetMe, Lovoo, Skout, Tagged, and Growlr.
With a share price of just under $ 5, MEET shares are up 25% in the past 12 months. And analysts agree that the next 12 months will also be rich in growth potential. The stock has a strong buy consensus rating and a 12-month target of $ 6, implying another 25% gain.
So why do analysts love this cheap stock? The answer is twofold.
When the company reported earnings on Nov. 7, the situation was on the mend. Earnings of 13 cents per share beat consensus estimates, and revenues of $ 52.6 million were up from $ 45.7 million last year. The income level for this quarter was also not one-off. This was the fourth consecutive quarter in terms of earnings for Meet Group stock.
The second part of this story is The Meet Group's cutting edge dating technology. On October 29, the company announced the release of a new live dating game. Inspired by TV dating shows, NextDate matches current users in the group and has a "love-o-meter" that helps rank the "contestants." If you see someone you like, you can pair them with him or her for one-on-one live streaming.
Gambling and online dating in general will flourish for the rest of 2019 and beyond. This means that MEET shares should remain on the list of cheap shares to buy for the foreseeable future.
Iteris (ITI)
Projected 12-month gain: 75%
Iteris (NASDAQ: ITI) has strong support from the analytical community. While the stock is far from the September 2019 highs, ITI shares are still up more than 26% in a year. In addition, the price could reach a 12-month target price of $ 8, which implies over 75% upside potential.
The company uses sensors to collect data for farms, roads and highways. In her own words, Iteris is transforming "big data into big disruptive solutions." One of the company's divisions sells traffic controllers. Another direction is aimed at the design, development and implementation of equipment that reports traffic conditions in real time. The third branch focuses on road maintenance solutions in response to weather and climate changes.
Analytics is the key to a company's earnings. Data is at the heart of everything Iteris does. And this data-rich company is catching the attention of big partners. The Colorado Department of Transportation is working with ITI to collect and use weather data to inform road maintenance solutions. This is in addition to partnerships with similar departments in South Carolina, Illinois and Florida.
Another recent partner is likely to contribute to the future growth of ITI stock. Cisco (NASDAQ: CSCO) chose Iteris as a partner, allowing the small company to use Cisco products alongside its own. The deal will improve safety on local roads, benefiting the state and municipal governments that provide Iteris services, according to Cisco and Iteris officials.
Given this news, Iteris looks like a great deal as more partnerships are expected in the future.
Angi Homeservices (ANGI)
Angi Homeservices (NASDAQ: ANGI) began trading in October 2017 following the merger of Angie's List and HomeAdvisor. ANGI now includes these brands as well as Handy, CraftJack and HomeStars.
A quick search on the Angi Homeservices website will find you specialists for duct cleaning, floor renovation, or holiday decorations, just to name a few. And this simplified home service delivery process is exactly what will continue to grow the stock of ANGI.
To be fair, it should be noted that ANGI shares have not shown a good move since 2017. But when the company reported profit on Nov. 7, the stock climbed 21.5%. Looking back on the third quarter, CEO Brandon Ridenour also said Homeservices Angi is on the road to growth again.
It seems that consumers and companies are using an online business model that takes into account future growth. Some estimates put this home improvement market at $ 400 billion – and the global home improvement market is expected to "grow at a compound annual growth rate of 52% by 2022."
Thus, as more people rely on their phones to find a service provider, Angi's Homeservices. With a share price of just under $ 8 and a 12-month target price of $ 12.08, the future looks great for the company.
Vonage (VG)
Following the company's IPO in 2006, Vonage's clients filed a class action lawsuit after early investors lost money. By the end of the year, VG's shares were down nearly 60%.
Last year hasn't been much better, resulting in a 30% decline in share prices. But everything may change soon. Since the beginning of the year, VG shares have fallen only 7%. And after a long history of transformation and failure, Vonage's shareholders are looking forward to rapid growth with fingers crossed.
Vonage, from the provision of telecommunications services to the provision of voice over the Internet (VoIP) services. Now, inspired by big names like Salesforce (NYSE: CRM) and Oracle (NYSE: ORCL), the company is switching to the world of software as a service.
On October 30, Vonage announced several new products, a new logo and a new marketing campaign to make one thing clear: the company plans to become a leader in this new era of software.
Today, Wall Street appears to be in agreement with CEO Alan Masarek's plans to rethink global communications. In addition, the concept of disrupting existing technology is now more than just a buzzword – it is what investors are actively looking for in a company's stock to buy.
If Vonage manages to manage this transition, it could reach its 12.1-month target price of $ 14.19, which implies more than 70% upside potential.
Glu Mobile (GLUU)
Do you have games on your phone? If so, then you might be like the other 2.4 billion consumers who statistically have games on their phones. And these gamers bring in $ 68.5 billion to the mobile gaming market every year. For Glu Mobile (NASDAQ: GLUU), these statistics may just be the lifeboat the company needs to turn its history around.
It's safe to say that the video game industry is undergoing huge changes. Consoles are becoming obsolete and streaming game subscriptions are on the rise. These broader changes provide a good tailwind for mobile gaming companies like Glu Mobile. Since gamers are more concerned with accessibility, they are attracted to free games that they can easily access on any smartphone.
The urge to spend money comes not only from those who play games. Tencent (OTCMKTS: TCEHY) has invested $ 126 million in Glu Mobile, which is nearly 15% of the shares. Companies like Tencent and financial institutions are realizing the potential in accessible mobile games.
It is important to note that GLUU shares are falling this year, down almost 30% over the past 12 months. Nevertheless, Glu Mobile has many original games as well as third-party branded ones. Licenses for Kim Kardashian: Hollywood, MLB Tap Sports Baseball and Restaurant Dash with Gordon Ramsay use big names to get attention. Analysts are seeking partnerships with MLB and WWE to drive Glu Mobile's stock gains in 2020 and beyond.
So, next time you swipe your phone to play your favorite mobile game, consider adding GLUU stock to your portfolio. With a 12-month target price of $ 7.29.
Ovid Therapeutics (OVID)
It was almost impossible to talk about promising cheap stocks without mentioning at least one biotech name. This is because these high-risk, high-reward companies perfectly highlight both the pros and cons of this type of investment. Just like a biotech company can be 100% profitable, it can crash and burn with negative test results.
Looking at cheap biotech stocks, Ovid Therapeutics (NASDAQ: OVID) looks like a good buy for a reason. OVID focuses on transforming the lives of its patients and seems to take a more moralistic approach to biopharm. The company specializes in developing treatments for rare neurological disorders and has a reliable income.
In its third quarter income statement, the company posted positive data on OV935, which is in co-development with Takeda Pharmaceutical (NYSE: TAK). The therapy has been found to reduce seizure rates in hard-to-reach patients in a current trial, according to Ovid guidelines.
While none of the company's drugs are on the market, the results of clinical trials deserve optimism. Until these trials are successful, Ovid Therapeutics should be safe to meet its $ 14 target. This 12-month target price implies a 440% increase over the current share price of about $ 2.50.
