Owning some of these companies in your portfolio can be a solid move. Not only are their prospects bright and financials healthy, these companies come from a diversified mix of brands, sectors and industries, giving people a lot to choose from and would help to diversify their core portfolio.
I don’t believe these under-$10 stocks to buy will stay cheap forever, and neither do some analysts on Wall Street. Taking bold action today could lock in capital appreciation, dividends and higher risk-adjusted returns in the future.
So, here are seven under-$10 stocks to buy for investors to consider this month.
Doman Building Materials Group (CWXZF)
Doman Building Materials Group (OTCMKTS:CWXZF) focuses on the wholesale distribution of building materials and home renovation products. It has its headquarters in Canada, being the only national distributor in the building materials and related products sector, but has extensive operations in the U.S.
If you have been following the housing market in the U.S. and North America, you know it has been making somewhat of a comeback, with house prices up around 5% since the same period last year. I do think as interest rates fall, demand will surge even higher.
I also think CWXZF’s dominance in Canada and operations in the U.S. position it as one of the top stocks for investors to buy in the building industry. For 2023, Doman generated an EBITDA of $196.1 million from revenues amounting to approximately $2.5 billion. The gross margin percentage also improved to 16.2% compared to the previous year.
This company can be a good way for investors to diversify their portfolio, especially if they are heavily U.S. concentrated.
Clean Energy Fuels (CLNE)
Clean Energy Fuels (NASDAQ:CLNE) provides natural gas as an alternative fuel for vehicle fleets in the United States and Canada. It should also be noted that CLNE is one of my contrarian picks for the list. Its shares have slid, trading from $3.80 at the beginning of 2024 down to $2.70, marking a 29% decline at the time of writing.
However, this stock price decline also opens the door to some opportunities. The market cap of CLNE is currently valued at approximately $606.09 million. The company’s price-to-sales (P/S) ratio is 1.42 times sales with a price-to-book (P/B) ratio of 0.83, indicating the stock might be undervalued, considering its book value per share of $3.27.
This undervaluation is due to rising CAPEX costs and some disappointing results for investors. It posted a net loss of $18.7 million recently, an increase from a net loss of $12.3 million in the same quarter the previous year. Its outlook is also looking shaky, as it projects a GAAP net loss between $111 million and $101 million, with Adjusted EBITDA estimated to be between $62 million and $72 million.
However, on an adjusted EBITDA basis, it saw a significant increase to $21.2 million from $12.2 million in the same period last year. It’s also important to note that the company is in the process of scaling, so it could be accretive for long-term for investors.
Jerash (JRSH)
Jerash (NASDAQ:JRSH) operates in the apparel manufacturing sector, exporting ready-made clothing.
For the last fiscal year, JRSH reported a net income of $2.4 million, or $0.19 per share, a decrease from the previous year’s $8.0 million, or $0.67 per share. Its cash and restricted cash totaled $19.4 million, with net working capital at $42.8 million.
JRSH has set its sights on maintaining revenue levels similar to fiscal 2023 for this year and achieving a gross margin goal of around 15% to 16%, contingent upon the final product mix of shipments it delivers to its customers.
Analyst forecasts for JRSH look attractive, as its EPS could increase by 121.43% this year. Although it has faced some challenges, some analysts agree that the future could be attractive for investors in the long run.
Tencent Music Entertainment (TME)
Tencent Music Entertainment (NYSE:TME) dominates China’s online music market. It trades at just under $10 at the time of writing, at $9.55.
I like TME a lot for its competitive position in China. It’s also one of the smaller-valued companies that seems to be doing a great job extracting value from AI. Notably, it had a 21% year-over-year (YoY) increase in its online music-paying user base and a 17% increase in average revenue per paying user.
Some institutions are also bullish on TME, including UBS (NYSE:UBS). In 2025, the bank forecasts a significant increase in TME’s paying user base to 125 million, up from 103 million in Q3 2023. That expected growth is attributed to an improved paywall ratio, among other measures, anticipated to drive a 20% compound annual growth rate (CAGR) in revenue from 2023 to 2025 for TME’s online music segment.
TME could be one of those top under-$10 stocks to buy for investors also looking to diversify their portfolios with exposure to the emerging Chinese economy.
Sirius XM (SIRI)
Sirius XM (NASDAQ:SIRI) operates in the satellite radio industry and provides a variety of subscription-based offerings to listeners.
SIRI was once a staple in many people’s homes a decade or so ago but it has since niched down its offering as it faces insurmountable competition from the likes of YouTube, and online streamline platforms that cater to the mass market.
There has been some good and bad news for SIRI stock, having reported its Q4 earnings for FY2023 with revenue aligning with analysts’ expectations at $2.29 billion. However, the company’s forecast for FY2024 is shaky, with revenue guidance set at $8.75 billion, 4.2% below analysts’ estimates, and suggests a -2.3% growth compared to FY2023.
Part of that is due to some events in FY2023, as the company saw a decrease of 445,000 in self-pay subscribers, reducing the total count to 34 million. That represents a 1% decline from the previous year, although the self-pay monthly churn rate remained low at 1.6%.
However, SIRI added 131,000 new self-pay subscribers in the previous quarter, which could mean its recent decline was just a statistical swing rather than a problem within the business itself. That incidentally improved its valuation for new investors.
Plug Power (PLUG)
I’m perhaps the biggest fan of Plug Power (NASDAQ:PLUG) here on Investorplace. Most analysts wrote the stock off after fears were raised about its ability to remain as a going concern. However, in the depths of negativity, I remained optimistic but also acknowledged its substantial risks.
PLUG has seemed to find a home at around the $5 mark, having fallen 71.7% over the past year. It can’t seem to breach above $5 for very long, acting as a long-term zone of resistance.
Sometimes, the biggest opportunities in the stock market can be found where no one else dares to look. PLUG recently shook off fears that it faces potential bankruptcy thanks to an over 20% surge in its top line, coupled with a commitment “to reduce cash burn levels by 70% from 2023 levels.”
Furthermore, it is also exploring additional revenue streams, realizing revenue deployed to data centers by 2025.
I think those who pulled out of PLUG early perhaps did not fully understand the company’s strategy, management and industry. That, arguably, contributed to a deterministic fall from its high of over $1,000 per share. But for now, it seems to have found its footing, and I expect it will be able to turn its fortunes around.
Nerdy (NRDY)
Nerdy (NYSE:NRDY) is an online learning platform utilizing AI technology to match educators with students.
Things went well for NRDY last year. The company demonstrated significant growth in 2023, focusing on expanding its subscription options for consumers aged 16 and above, leading to a 19% YoY revenue increase in Q3 for its consumer business and a 27% YoY increase for the company overall.
For its most recent quarter, NRDY reported a quarterly loss of $0.05 per share, beating some analyst estimates of a loss of $0.11 per share. That represents an earnings surprise of 54.55%. Furthermore, the company has exceeded consensus EPS estimates for the past four quarters and topped consensus revenue estimates four times as well, according to Zacks.
I think in the long term, things will improve for the company. Part of this is because six analysts have a Buy rating for the company and also forecast a 64.36% increase in its stock price to be reached within the next 12 months.
On the date of publication, Matthew Farley did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.