Investors looking for a bargain and potential upside have strong buy stocks under $10 to consider. Investors should snap up companies that have value without sacrificing quality or growth.
A stock may trade at a deep discount because sellers are dumping it at the same time. A company’s quality does not change when the stock price falls to $10 or less.
Mutual fund managers may avoid stocks at that price. This gives retail investors an advantage. We may snap up those companies and wait for the stock market to recognize their worth.
For example, the market may not recognize its profit margin. The balance sheet may have favorably low debt/equity, all of those metrics matter to the investor. When the economy rebounds, those companies will post strong results sooner than their peers.
|SIRI||Sirius XM Holdings||$3.72|
Ambev (NYSE:ABEV) is a Brazilian brewing company. In the last quarter, it reported revenue growing by 3.3%.
Looking ahead, Ambev expects net revenue will grow from net revenue per hectoliter performance to volumes. Profits should rise as the brewer contains input costs, thanks mostly to hedges.
Ambev will drive its growth by spending on marketing efforts. For example, it will promote its premium brands in Canada. Chief Financial Officer Lucas Lira said that the industry declined in the last few years, yet Ambev’s market share grew.
The company is betting that Beyond Beer will resonate with customers. Despite a weak performance in that brand last year, it saw a slight recovery toward the end of 2022. Expect momentum to speed up from there as advertisements drive demand higher.
In Q4/2022, Ambev set higher prices for its beers. For 2023, it will benefit from the resilient demand. Further efforts to reconnect with customers after the Covid pandemic will strengthen sales volumes.
Ericsson (NASDAQ:ERIC) fell slightly after paying a $206.7 million fine to the U.S. Department of Justice.
In 2019, the company violated the Foreign Corrupt Practices Act. The firm pleaded guilty regarding previously deferred charges. Though the amount could have been higher, investors did not get behind ERIC stock by bidding shares higher.
The beaten-down company is transforming its culture and its business efficiency. It has visibility on customer demand, project rollouts, and its cost situation. CFO Carl Mellander said that the company is confident that it will meet project targets this quarter.
It is controlling costs. Reuters reported that according to a memo, it will cut 8,500 staff. The move aligns with its plans announced in Dec. 2022 to lower costs by $880 million by the end of this year.
Ericsson’s profit margins might rise from around 40%. It will depend on the size of its inventory adjustment this quarter. Expect modest write-downs in each of the next two quarters, which may hold the stock back. After that, when the macro-environment improves in around six months, profitability will rise.
Himax Technologies (HIMX)
Himax Technologies (NASDAQ:HIMX) is a sensor developer. HIMX stock dipped slightly after it posted a 42% drop in revenue to $262.2 million.
The firm also guided its revenue range to a 12% to 17% Q/Q decline. Q1 is a seasonally weak period for Himax. After that slow quarter, its business will re-accelerate.
CEO Jordan Wu discussed the large-sized driver integrated circuit demand weakness. He said that automotive exposure is nothing new.
It hurt results for a few quarters as the industry managed through the supply chain disruption. The sudden stop in output for components in China hurt its results in the last quarter. Fortunately, China ended its Covid lockdown in late 2022.
Demand for in-cell Touch and Display Driver Integration (TDDI) single-chip solutions appear promising. This is a relatively new product that new automobiles require, especially in the electric vehicle market. Thanks to more EV models coming to market, Himax has a winning revenue growth catalyst with TDDI.
Nokia (NYSE:NOK) is a long-forgotten wireless phone supplier from nearly two decades ago.
Today, it is pivoting as the largest 5G network company. While its logo update will not catch investor attention, its many contracts win in wireless networking hardware will.
On Feb. 22, Nokia won a 10-year 5G deal with Antina in Singapore. The press release included no financial terms. However, the contract shows that customers are confident in Nokia as a long-term supplier. Nokia supplies premium 5G solutions that expand Antina’s coverage and capacity. The demand for low latency and high-speed wireless will keep growing.
Nokia announced that along with its partners NTT Docomo and NTT achieved a technology milestone. The companies paired an AI-based learning waveform in a transmitter with a deep-learning receiver. This sets a 6G path where the radios will learn and use the sub-terahertz spectrum. Nokia could become a leader in boosting network capacity in the 6G space.
Pitney Bowes (PBI)
Pitney Bowes (NYSE:PBI) supplies mailing solutions. This includes mail sorting and tracking products like Presort. Presort offers marketing mail and bounding for customers.
Pitney’s SendTech is a digital sending technology that will grow in shipping revenue. In North America, it, along with new products, accounts for 40% of revenue. The company applies the Internet of Things to streamline postal services.
PBI stock is trending lower since its Q4/2022 report. The company posted a 7.6% drop in revenue. In 2023, Pitney Bowes expects revenue growth in the flat to mid-single-digit percentage. Investors are cautious about buying shares in a company that may not grow.
To increase its operating efficiency, the company divested Borderfree recently. Although it could have developed its global business, the sale forces the company to focus on its strengths. It will offset the slowdown in the mail business by expanding its shipping revenue.
SendTech and Presort are hardware products that will turn the company around.
Sirius XM Holdings (SIRI)
Sirius XM Holdings (NASDAQ:SIRI) is a streaming broadcasting company. SIRI stock lost nearly half its value after failing to hold the $6.00 level.
In an SEC filing, the firm disclosed it cut 8% of its workforce. It cut costs further by lowering its spending on content and marketing. In addition, it reduced its real estate footprint, which will save the company on lease and rental costs.
Sirius XM subscription growth is the biggest revenue opportunity. Chief Executive Officer Jennifer Witz said that it accumulated 32 million paying subscribers. It attracted them through the automotive funnel. Automotive buyers know all too well that their AM/FM radio has a Sirius XM preview channel. As a result, drivers upgrade to a paid, premium version.
CarPlay and Android Auto seek to build from a near-zero market share. Fortunately, Sirius is a dominant provider that can adjust its pricing and content mix to compete effectively.
Estimate a potential adult audience of around 55 million listeners, and Sirius might win their business as its service develops.
Sirius is among the strong buy stocks under $10.
Teva Pharmaceutical (TEVA)
Teva Pharmaceutical (NYSE:TEVA) is one of the strong buy stocks under $10. In just the last month, TEVA stock traded at above $10.
The generic drug manufacturer attracted selling after selling $2.49 billion in sustainability-linked notes. Strong demand for the debt allowed Teva to up-size the offering from $2.25 billion.
The debt will give Teva the finances to deliver on its growth mandate. The U.S. generics are the top priority. CFO Eli Kalif said that generic drug pricing is stabilizing. Outside of this country, ex-U.S. generics revenue is worth around $5 billion. It is a stable business with consistent margins. Teva will build this business by developing complex generics. For example, it will develop inhibitors and injectables.
The more complicated the drug, the higher the drug price and the bigger the profit margin. The market’s skepticism toward Teva is discounting the stock more than it should. Once Teva monetizes its portfolio of 16 assets of biosimilars, revenue will expand for years to come.
On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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