While most of Wall Street focuses on large 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 low-to-mid hundreds, all the way up to over $1,000 per share. At those steep prices, it’s pretty hard 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.
We screened our 24/7 Wall St. research database and found five stocks trading under the $10 level that could provide investors with some solid upside potential. While more suited for aggressive accounts, they could prove exciting additions to portfolios looking for solid alpha potential.
If things go right for this small cap biotech, investors may get huge returns. Corbus Pharmaceuticals Holdings Inc. (NASDAQ: CRBP) is a Phase 3 clinical-stage pharmaceutical company, focused on the development and commercialization of novel therapeutics to treat rare, chronic and serious inflammatory and fibrotic diseases.
The company’s lead product candidate, lenabasum, is a novel, synthetic oral endocannabinoid-mimetic drug designed to resolve chronic inflammation and fibrotic processes. Lenabasum is currently being evaluated in systemic sclerosis, cystic fibrosis, dermatomyositis and systemic lupus erythematosus.
Canaccord Genuity has a massive $38 price target on the shares, which compares to the lofty but lower Wall Street consensus target of $23.71. The shares were trading on Friday’s close at $7.68 apiece.
This energy stock has had a nice run off the bottom but still holds huge upside potential. QEP Resources Inc. (NYSE: QEP) is a holding company that engages in the exploration and production of oil and natural gas properties. It focuses in the Northern Region (primarily in North Dakota, Wyoming and Utah) and the Southern Region (primarily in Texas and Louisiana).
Aethon Energy Management recently announced the completion of its acquisition of natural gas assets from wholly owned subsidiaries of QEP Resources. The assets are located in the Haynesville basin in northwest Louisiana. The QEP assets comprise approximately 49,700 net acres and 607 operated wells of natural gas producing properties and undeveloped acreage in the Haynesville. Aethon III also acquired all of QEP’s associated gas gathering and treating systems related to these assets, supporting up to 600 MMcfe/d of production.
The collective reserve base of QEP’s assets combines low risk, long life and highly predictable production with attractive development opportunities.
Oppenheimer has put a solid $13 price objective on the stock, while the consensus target was last seen at $11.01. The stock closed Friday at $7.75 per share.
This top small-cap play could make sense for more aggressive accounts. Ryerson Holdings Inc. (NYSE: RYI) offers a line of stainless steel, aluminum, carbon steel and alloy steels, as well as nickel and red metals in various shapes and forms, including coils, sheets, rounds, hexagons, square and flat bars, plates, structurals and tubings.
The company also provides value-added processing and fabrication services, such as sawing, slitting, blanking, cutting to length, leveling, flame cutting, laser cutting, edge trimming, edge rolling, roll forming, tube manufacturing, polishing, shearing, forming, stamping, punching, rolling shell plate to radius and processing materials to a specified thickness, length, width, shape and surface quality pursuant to specific customer orders.
The $10 Deutsche Bank price target compares with the $8.92 consensus target. The shares closed trading on Friday at $7.02.
This company could be poised for big gains as liquefied natural gas (LNG) exporting continues to ramp higher. Tellurian Inc. (NASDAQ: TELL) is an LNG development company headquartered in Houston. The company plans to develop a 27.6 metric tonnes per annum LNG terminal with five plants near Lake Charles, Louisiana, as well as upstream assets and pipeline infrastructure.
The initial phase likely will include three plants (16.6 metric tonnes per annum, capacity). The Driftwood project will be financed by equity customer/partners as well as project debt financing. Tellurian will own 28% to 42% of Driftwood Holdings and 100% of Tellurian Marketing.
The company recently announced that the U.S. Federal Energy Regulatory Commission issued the final Environmental Impact Statement for Driftwood LNG export facility and an associated 96-mile pipeline (Driftwood project), proposed near Lake Charles on the U.S. Gulf Coast. When and if the agency grants authorization, Tellurian should be ready to make a final investment decision and begin construction in the first half of 2019, with the first LNG expected in 2023.
The Merrill Lynch energy team’s Buy rating comes with a $12 price objective. The posted consensus target price is $11.38, and the stock traded most recently at $9.50 a share.
Since the recent IPO, this stock has been hammered and offers investors an incredible entry point. Uxin Ltd. (NASDAQ: UXIN), through its subsidiaries, operates a used car e-commerce platform in China. Its Uxin Used Car app provides consumers with customized car recommendation, financing, title transfer, delivery, insurance referral, warranty and other related services. Uxin Auction is an app that helps business buyers to source vehicles through online auctions.
The company also facilitates used car transaction services and financing solutions offered by third-party financing partners to buyers for their used car purchases. Uxin announced on Jan. 14 that its key cross-regional transaction service volume exceeded 10,000 units this past December. The 2018 figures were more than 75 times higher than those from the same period in 2017.
JPMorgan rates the stock at Overweight, but its $7 price target is way below the $11.72 consensus target. The shares closed trading at $3.22 on Friday.
These are five stocks for aggressive accounts that look to get share count leverage on companies that have solid and sizable upside potential. While not suited for all investors, these are not penny stocks with absolutely no track record or liquidity, as major Wall Street firms have research coverage on them.