Stocks ended this last week on a very rough note, but we also saw yet another new high in stocks earlier in the week as well. This bull market feels as though it is migrating to a stock picker’s market, where investors look for upside in individual companies rather than broad rallies. This brings up the stocks under $10 where investors think they can have well above average gains.
24/7 Wall St. reviews dozens of analyst research reports each day of the week for new ideas for our readers. We often see big upside or downside in many analyst calls, but in stocks trading under $10 is where we often see calls for stocks to rise 50%, 100% or even exponentially. In order to come up with the weekly list of stocks under $10, it usually requires going back through 200 to 300 analyst calls to filter out the microcap companies or oddball calls.
Readers must know that low-priced and small-cap stocks generally have more implied risk than most established stocks. For instance, investors almost never get to see upside targets issued on Dow Jones Industrial Average and S&P 500 stocks with this sort of magnitude. Another consideration with small cap or low-priced stocks under $10 stocks is that these would almost never pass a “widows and orphans” suitability test for investors.
These are the five analyst stocks under $10 that made the grade this week, with a runner-up included due to it only recently rising above $10.
Amphastar Pharmaceuticals Inc. (NASDAQ: AMPH) is still a new public company, and its quiet period ended this past Monday. BMO Capital Markets issued an Outperform rating and $17 price target. Needham issued an Outperform rating and $17 price target. Piper Jaffray started it as Overweight with a $16 price target. Jefferies issued a Buy rating, but with a less bullish $14 price target. Amphastar closed at $9.55 prior to the new analyst calls, and shares were down at $9.30 later in Monday trading, ultimately sliding to $8.98 by Friday’s close.