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. We are also keenly aware of the latest sector trends and make sure to cover all of the hottest industries.
Today we’ve highlighted three stocks that fall into the broad “technology” sector. Each of these three stocks is currently trading for less than $10 per share and holds a Zacks Rank #2 (Buy) or better. Take a look at the strong estimate revision activity and other factors that make these tech companies stick out right now.
Top 5 Performing Stocks To Watch For 2019: Volkswagen Aktiengesellschaft (VLKAY)
Wolfsburg, Germany-based Volkswagen AG (OTCMKTS:VLKAY) manufactures and sells automobiles in Europe, North America, South America, and the Asia Pacific. This Zacks Rank #2 company has a 3-5 years EPS growth rate of 6.2% and a Value Score of A.
Top 5 Performing Stocks To Watch For 2019: Exxon Mobil Corporation(XOM)
Oil giant ExxonMobil (NYSE:XOM) stumbled into 2018 after reporting lackluster results to end last year. Because of that, its stock endured its worst trading day since 2011 only to follow it up the very next one with a similar rout. While it’s started to recover, it’s still down 5% for the year even though oil has improved another 10%. As a matter of fact, Exxon is currently trading at a valuation not seen since the 1980s.
One result of this low valuation is that its dividend yield is now up near 4%, which we haven’t seen since the ’90s. These factors make this month an excellent one to consider buying this oil behemoth for the long haul.
Top 5 Performing Stocks To Watch For 2019: Microsoft Corporation(MSFT)
Microsoft announced that its Windows 10 subscriptions have reached a milestone.
The tech giant said late Tuesday that it now has more than 200 million enterprise workers running Windows 10 as the company has been pushing companies to upgrade from Windows 7. Microsoft said that updates for the older operating system will no longer be supported in about 20 months.
Joe Belfiore, a company corporate vice president who’s at the helm of the Windows 10 team, made the announcement at Microsoft’s Build developers conference. “We’ve seen that [Windows 10] adoption rate increase now at 79% year-over-year growth.”
On Monday, the company added that roughly 700 million devices are now running Windows 10 across the world, with enterprises accounting for slightly less than 30% of all Windows 10 copies.
MSFT stock was also up a fraction of a percentage after Wednesday’s market close.
Top 5 Performing Stocks To Watch For 2019: Baidu Inc.(BIDU)
investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-300×150.jpg 300w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-768×384.jpg 768w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-60×30.jpg 60w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-200×100.jpg 200w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-400×200.jpg 400w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-116×58.jpg 116w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-100×50.jpg 100w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-78×39.jpg 78w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-800×400.jpg 800w, investorplace.com/wp-content/uploads/2017/08/baidu-inc-adr-bidu-stock-ipsize-170×85.jpg 170w” sizes=”(max-width: 950px) 100vw, 950px” style=”margin: 0px 0px 18px; padding: 0px; border: none; font-style: inherit; font-variant: inherit; font-weight: inherit; font-stretch: inherit; line-height: inherit; vertical-align: baseline; outline: 0px; background: transparent; height: auto; max-width: 100%; width: auto;” />I highly recommend checking out Baidu Inc (ADR) (NASDAQ:BIDU), China’s No. 1 search engine. With a Q1 beat and very strong Q2 guidance, this is a top stock to track right now. “The beat was attributed to a series of AI-driven efforts including dynamic ads, which has been described as increasing click-through rates by double digits” explains top Wells Fargo analyst Ken Sena.
He is feeling so encouraged by the company’s outlook that he ramped up his already-bullish price target by $10 to $310. This suggests 22% upside potential. According to Sena, “Baidu’s share currently trades at 24x Adj. 2018E EPS of ¥67.20/$10.59, making it attractive among our Outperform-rated names, particularly when considering the industry leadership it is showing within AI, both as it applies to core (Search, Feed), video, and new initiatives (Apollo, DuerOS).”
Top Oppenheimer analyst Jason Helfstein agrees. He believes Baidu is still undervalued compared to Google, especially when you consider that BIDU is in prime position for the rapid growth of China’s online ad market. “We think key drivers include increasing number of paid clicks, higher conversion rates and higher cost-per-click (CPC). The penetration of smartphones in China, especially in lower tier cities, provides another strong revenue stream for BIDU as it starts to monetize mobile search separately” comments the analyst.
He has a $295 price target on BIDU. Bear in mind that Helfstein’s strong track record on BIDU stock specifically (87% success rate and 21.1% average return per rating) further reinforces the credibility of his latest recommendation.
Top 5 Performing Stocks To Watch For 2019: Manhattan Associates, Inc.(MANH)
Manhattan Associates Inc (NASDAQ:MANH) is up nearly 150% in the past five years, which is a very respectable run.
However, in the past two years it’s off nearly 30% with about half of that happening in the past year. The trend in MANH’s case, at this point, is not your friend.
The problem is, MANH is an SaaS that specializes in supply chain, inventory and omnichannel management for retailers, wholesalers and manufacturers. There has been such a cross pollination in recent years regarding the challenges that can be addressed with software systems, that niche firms, or firms that could do one thing well have to pivot.
Some are making that pivot and others are losing ground. None of its sectors are doing well enough to justify its forward P/E of 30.