5 Stocks Under 10 Dollars With Low Valuations and High Margins

5 Stocks Under 10 Dollars With Low Valuations and High Margins

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We looked for stocks under 10 dollars with features like low P/E ratios and high margins to find growth plays. 

Stock futures were trading well above average before the markets opened this morning over optimism about the December jobs report. However, while unemployment fell below 7% for the first time in years, the number of actual jobs added was low. But some analysts are saying that the resoundingly ambiguous data could be a good thing.

For one, if too many jobs are added, you might get a quicker taper from the Fed. The markets seem to prefer moderate progress on unemployment to huge gains. 

Others say that it's about time for a bit of market correction. After record gains across all the major indices – many investors were finding it harder and harder to find decent buying opportunities. 

Investing ideas

With valuations so high, we decided to add a couple extra parameters to today's screen. We began by looking at companies priced in between $5-10. Then we limited the screen based on valuation, only looking at stocks with a price to equity (P/E) ratio below 15.  

Next we looked at historical performance, only including companies that have improved their earnings per share (EPS), and their sales, over the last five years. Historical performance can be even more revealing than projected performance, because projected growth is often already priced into the stock.

Finally we looked at the companies with good financials, with very low long-term debt, and high profit margins, in this case above 20%. We were left with five stocks under $10 on our list.    

Click on the interactive chart to view data over time. 

1. ClearOne Communications Inc. (CLRO, Earnings, Analysts, Financials): Operates as a communications solutions company that develops and sells audio conferencing, collaboration, streaming media, and connectivity systems and other related products for audio, video, and Web applications. Market cap at $81.39M, most recent closing price at $9.06.

P/E: 2.99

EPS past 5 years: 42.6%

Sales past 5 years: 3.6%

Long term debt to equity: 0.00

Profit margin: 59.7%
 

 

2. 1st Century Bancshares, Inc. (FCTY, Earnings, Analysts, Financials): Operates as a bank holding company for 1st Century Bank, National Association that provides a range of banking services. Market cap at $60.88M, most recent closing price at $6.99.

P/E: 8.42

EPS past 5 years: 3.3%

Sales past 5 years: 0.4%

Long term debt to equity: 0.00

Profit margin: 46.3%

 

3. Fifth Street Finance Corp. (FSC, Earnings, Analysts, Financials): Is a business development company specializing in investments in middle market. Market cap at $1.31B, most recent closing price at $9.42.

P/E: 10.35

EPS past 5 years: 33.8%

Sales past 5 years: 46.2%

Long term debt to equity: 0.00

Profit margin: 54%

 

4.Gran Tierra Energy, Inc. (GTE, Earnings, Analysts, Financials):Engages in the acquisition, exploration, development, and production of oil and gas properties in Colombia, Argentina, Peru, and Brazil. Market cap at $1.99B, most recent closing price at $7.04.

P/E: 11.13

EPS past 5 years: 42.6%

Sales past 5 years: 78.5%

Long term debt to equity: 0.00

Profit margin: 25.5%

 

5. Yongye International, Inc. (YONG, Earnings, Analysts, Financials): Engages in the research, development, manufacture, and sale of fulvic acid based crop and animal nutrient products. Market cap at $331.98M, most recent closing price at $6.53.

P/E: 2.16

EPS past 5 years: 33.6%

Sales past 5 years: 102.2%

Long term debt to equity: 0.02

Profit margin: 23.6%

 

 

(List compiled by James Dennin. Yearly returns sourced from Zacks Investment Research, all other data sourced from Finviz.)

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