Here at Zacks, we don't generally classify stocks as "cheap" or "expensive", and rather than looking at the stock's face value, we have a system that puts an emphasis on earnings estimate revisions to find stocks that will hopefully be winners for investors.
That being said, low-priced stocks can be attractive to smaller investors that can't necessarily afford large stakes in companies with higher priced stocks. When looking at these low-priced stocks, we can look at the same trends in growth, value, and momentum and apply the Zacks Rank to properly analyze the potential that these companies have.
Today we've highlighted ten stocks that are currently trading for under $20 per share. All of these stocks currently have a Zacks Rank #1 (Strong Buy), and a variety of other factors make these companies stand out as having strong upside potential.
1. BlackBerry Limited BBRY
Prior Close: $7.35
BlackBerry LTD is engaged in the design, manufacture, and marketing of hardware and software solutions for the mobile communications market. The company has seen two positive estimate revisions for its current-quarter earnings over the past 60 days, and our Zacks Consensus Estimate now calls for EPS growth of 45.83%. BlackBerry will be able to post year-over-year EPS growth, in spite of its declining revenue, because the company has successfully shifted its focus away from its failing handset division and towards the more-profitable software business.
2. Axcelis Technologies ACLS
Prior Close: $15.80
Axcelis Technologies is a leading producer of ion implantation equipment used in the fabrication of semiconductors. The company also produces dry strip, photo-stabilization and rapid thermal processing equipment. Axcelis has seen two positive earnings estimate revisions within the past 60 days, and current consensus estimates would reflect EPS growth of 167% and sales growth of 23% this quarter.
3. AudioCodes Ltd. AUDC
Prior Close: $7.11
AudioCodes is a designer and developer of enabling technologies and communication components for the transmission of voice, fax and modem over packet networks. Over the past 60 days, AudioCodes has received two positive estimate revisions, bringing its current-quarter Zacks Consensus Estimate two cents higher in that time. The company will hope it can continue its impressive earnings run that has included an average beat of 29% in each of the trailing four quarters.
4. First Bank FRBA
Prior Close: $13.80
First Bank is a New Jersey-based bank with five full-service branches throughout the state. Right now, the company is benefitting from the strength of the regional banking industry, as its own group of similar businesses currently falls into the Top 7% of the Zacks Industry Rank. First Bank has also received one positive estimate revision for its current-quarter earnings, and our consensus EPS estimate now calls for earnings growth of 36% in the quarter.
5. Guidance Software GUID
Prior Close: $7.37
Guidance Software is a leader in digital investigative solutions. Its EnCase platform provides useful tools foundation for government, corporate and law enforcement organizations. The company has seen three positive estimate revisions in just the last seven days, which has helped continue the impressive run that has earned the stock an "A" grade for Momentum in our Style Scores system. Based on current estimates, Guidance Software is another company looking to post strong earnings growth this quarter.
6. McDermott International MDR
Prior Close: $8.02
McDermott International is one of the leading worldwide energy services companies, providing steam-generating and environmental equipment for the U.S. government and others. The company is set to release its latest earnings report next week, and it currently has a positive Earnings ESP of 100%. Along with its strong Zacks Rank, this is a good indicator of an earnings beat. Additionally, it is worth noting that McDermott has some of the best margins in its comparable industry.
7. Nova Measuring Instruments NVMI
Prior Close: $16.76
Nova Measuring Instruments develops and produces monitoring and measurement tools for the semiconductor manufacturing industry. In its recent earnings report, Nova Measuring posted yet another beat; the company has surpassed the Zacks Consensus Estimate by an average of 31% in each of the trailing four quarters. Based on its solid guidance, the Zacks Consensus Estimate for the current quarter is now 11 cents higher, which now reflects EPS growth of 171%.
8. Pixelworks Inc. PXLW
Prior Close: $4.15
Pixelworks is a developer of semiconductors and related software that enable the visual display of broadband content though a wide range of electronic devices. The company is yet another on this list that is showing aggressive growth prospects, which has helped it earn an "A" grade for Growth. The stock has also been on an impressive run, with shares gaining about 37% over the last four weeks, and the company has posted an average earnings beat of 60% in each of the trailing four quarters.
9. Sunrun Inc. RUN
Prior Close: $6.04
Sunrun Inc. is a leading developer of residential solar energy systems, operating through both its direct-to-consumer and partner-focused channel. Sunrun is expected to report its latest earnings results on March 8, and with a positive Earnings ESP of 245%, another beat is looking likely for the company. This would continue its impressive earnings run, which has seen the company surpass the Zacks Consensus Estimate by an average of 135% in each of the trailing four quarters.
10. TIM Participacoes S.A. TSU
Prior Close: $15.84
Through its subsidiaries, TIM Participacoes is the largest provider for mobile cellular service in Brazil and the only company to operate throughout the entire Brazilian territory. The company's current-quarter Zacks Consensus Estimate has gained three cents over the last 30 days, and it is also displaying solid fundamental metrics. These additional metrics have helped TIM earn an "A" grade for Value and a "B" grade for VGM.
A stock's market price is not a clear indicator of whether it is a good investment. However, the nice thing about the Zacks Rank is that it can be applied to stocks of any price. All of the stocks highlighted here hold a Zacks Rank #2 (Buy) or better ranking, while also possessing other qualities that help them stick out. For smaller investors looking to get into solid stocks at lower prices, this list is a great place to start and all of these companies could just be great picks going forward.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017? Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>