3 best stocks under $ 10

0


Stocks are expensive these days, so investors are looking for good deals in the market. Major stock indexes are near all-time highs, and valuation ratios have also stretched towards the upper ends of their historical ranges.

With stock fractions available from most brokerage houses, you don’t have to focus on stocks with low stock prices. By itself, the stock price has nothing to do with the total value of a company. However, if you’re looking for low-priced stocks that actually offer good value, we did some research to find three great stocks that cost less than $ 10 a share.

1. Anteromedial

Median antero (NYSE: AM) is a Master Limited Partnership (MLP) which was created to manage the intermediate operations of Antero Resources (NYSE: AR) in the Appalachian region. Antero Midstream owns pipelines and infrastructure that are used for the collection, transportation and storage of gases and liquids associated with the production and transportation of natural gas.

Antero Midstream ultimately backs Antero Resources, so its strategy and results are closely linked to the parent company. Higher volumes resulted in a 13.6% revenue increase in 2020, but the company only expects single-digit growth rates over the next five years. MLP increases capital spending to accelerate capacity growth. This is intended to support the accelerated growth in volume production of Antero Resources, but it will force the MLP to reduce its quarterly dividend in 2021. Even with the cut, the dividend will be close to the amount of free cash flow that the company s. ‘waits to produce. This means that there isn’t a lot of leeway, and it’s not a situation where the company could simply increase distributions to shareholders if it chose to do so.

Still, Antero Midstream pays a dividend yield of around 9.5% and is trading at a modest forward P / E of 11.5. The market anticipates a drastic dividend cut or unusually slow dividend growth in the future. MLP presents more opportunities than risks right now, and stocks cost just under $ 10.

Image source: Getty Images.

2. Radiant logistics

Radiant logistics (NYSEMKT: RLGT) is a shipping logistics company that partners with third parties to transport items that are often too large for leading freight carriers such as UPS and FedEx. Radiant’s services include freight forwarding, brokerage, tracking and consulting.

Radiant’s annual revenue increased from $ 25 million in 2006 to $ 900 million in 2021 through organic growth and acquisitions. However, this rate of expansion has slowed in recent years, and modest growth is expected to continue for the foreseeable future. Profits exceeded sales due to efficiency improvements and scale gains, but margins are not expected to increase significantly in the future.

Still, there are reasons to love Radiant. It is a well-run company that is successful in its niche. It enjoys excellent financial health in terms of leverage and solvency. Above all, it’s cheap. The stock trades with a forward P / E ratio of 11.7 and an enterprise value / EBITDA ratio of 8.9. These are weak compared to its peers.

Radiant’s inexpensive valuation and sound financial health could make it a prime acquisition target. The stock may also attract the attention of investors who are starting to look for smaller stocks as valuations rise among large caps in other sectors.

3. United Microelectronics

United microelectronics (NYSE: UMC) is a relatively small chip maker based in Taiwan. Semiconductor stocks can be very cyclical and the industry is currently experiencing some volatility. Higher than expected demand coupled with supply chain disruptions has resulted in a global chip shortage. Chipmakers like United Microelectronics are potential beneficiaries of this trend, as they can create components and enjoy some pricing power amid growing demand.

United Microelectronics is investing heavily to modernize its production capacity. Some investors fear it is too late for the party, but some industry executives predict supply issues beyond 2022. That would be great for the bull’s talk.

The stock pays an annual dividend, which resulted in a healthy 3% return earlier this month. Its forward P / E ratio of 17.4 is in line with its peers and its own historical range. These measures suggest that there is still room for stock prices to rise if United Microelectronics can take advantage of the chip supply shortage over the next year. Nothing is guaranteed in the cyclical and evolving semiconductor industry, but there is a combination of upside and fundamental stability here. This is rare for stocks in this price range.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.


Share.

Leave A Reply