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3 “Strong Buy” stocks below $ 10 that are about to break out

Let’s talk a little about growth and potential. The two are not always the same, but both are critical to a successful investment. After all, the goal of all equity investments is to generate growth – and that means to find stocks with the highest potential. It is natural to focus on the headline-grabbing big-name giants. They have tremendous market valuations and made their early investors very happy. But there’s an unfortunate truism in the markets based on the iron rules of math: the bigger a company gets, the less likely it is to make high returns. A $ 200 million company is far more likely to double in value than a $ 200 billion giant. And that brings us to small-cap stocks. For investors looking for the best combination of high growth potential and low entry costs, the small caps might be just the thing. We used the TipRanks database to find several that would fit a profile: a market cap under $ 400 million and a stock price under $ 10. Even better, these small-cap tickers have a strong buy consensus rating from the analyst community and have strong upside potential. PowerFleet, Inc. (PWFL) The Internet of Things is transforming a wide variety of industries, from factory floors to warehouses to truck fleets. PowerFleet, the first small-cap inventory we’ll look at, applies IoT and M2M technology to the security, control, tracking, and management of high-end assets, including tractor units, containers, industrial trucks, and freight, vehicle – and and truck fleets. PowerFleet’s sales in the first quarter were in line with the previous quarter and included an improvement in earnings. On balance, reported revenue of $ 29 million was just 1.3% below fourth quarter earnings. The reported EPS loss of 9 cents improved by 25% compared to the loss of 12 cents reported in the previous quarter. Year-on-year, EPS improved by 40%. At the beginning of this month PowerFleet received two important new orders. On May 10th, the company announced a 4-year contract with the Israeli Police to introduce a fleet management and driver solution system for more than 7,500 vehicles of 61 different types. The contract includes an option for an extension of 4 years. Two days later, PowerFleet announced a smaller contract with Alabama-based White Oak Transportation to provide tracking services for the freight forwarder’s fleet of 850 vehicles, particularly its cargo trailers. 5-star analyst Michael Walkley, who covers PowerFleet for Canaccord, sees a clear path for the company’s continued growth. “With more than 600,000 subscribers, PowerFleet has the size and international footprint to compete for global tenders against leading competitors in fleet and asset tracking. For fleet management, PowerFleet is one of the few true end-to-end solutions on the market that includes cabs, refrigerated trailers, drying trucks and containers, “said Walkley. The analyst added,” We believe PowerFleet has a strong product portfolio and a leading solutions platform to increase its market share. That strength is evident in its expanding global customer base … We believe PowerFleet has the leadership team to execute on its growth strategy and expect revenue to rebound and margins to increase as global economies recover. “To that end, Walkley is pricing PWFL with a buy and its $ 12 price target implies an uptrend of 84% for a year. (To see Walkley’s track record, click here.) Overall, Strong Buy’s unanimous consensus rating here, based on 4 recent positive ratings, shows Wall Street approves Walkley on this stock. The shares trade for $ 6.51 and the average target price of $ 11.13 indicates a potential 71% gain over the next 12 months. (See PWFL stock analysis on TipRanks.) AXT, Inc. (AXTI) AXT is a materials science company active in the semiconductor supply chain. AXT develops and manufactures the high-performance rare metal substrate wafers that are required for the construction of semiconductor chips and optoelectronic components. AXT operates in both California and China, staying close to Silicon Valley customers and Chinese raw materials. The company has an important niche in the chip industry, and sales and earnings reflect that. Revenue reached $ 31.4 million in the first quarter of 2021, topping the $ 30 million mark for the first time, growing 51% year over year. The EPS reached 8 cents, a dramatic turnaround compared to the 1-cent loss reported in the same quarter of the previous year. Along with its first quarter results, AXT also announced the first shipments of gallium arsenide (GaAs) substrates with a diameter of 8 inches to a major customer. AXT has received “great interest” from potential customers for GaAs products and predicts increased demand as the products find more applications. In particular, analyst Richard Shannon, who covers this stock for Craig-Hallum, notes the increasing demand for the company’s products. “The demand profile of InP (optics, health monitoring) and GaAs (5G, optics, 3DS, microLED) is as powerful as any other we can find in small-cap technologies. With an improving customer base (Tier 1 driving much of future growth), GM still growing, and valuation upside potential from a STAR listing in mid-2022, investors have several options for profit on this stock, “wrote Shannon. Shannons Uptrend comments back his buy recommendation and his target price of $ 17 suggests 90% growth potential for the coming year. (To see Shannon’s track record, click here) Wall Street valuations on AXTI fall 3 to 1 in favor of buying versus Hold Off AXTI’s shares are selling for $ 8.95 each, and the average target of $ 16 indicates a possible uptrend of ~ 79% from that level. (See AXTI stock analysis on TipRanks.) CECO Environmental (CECE.) For the last stock on our list, we’ll turn to the green economy, in the CECO Environmental Air Quality and Fluids Ha Development, provision and installation of handling systems. In short, the company deals with air pollution control technology, a niche that has been in demand since the 1970s. CECO offers expertise and systems in a wide variety of industries, including building materials such as brick, cement, steel and glass. and manufacturing in the automotive, aerospace, pharmaceutical, chemical, and fuel refinement industries. In the company’s latest financial release for the first quarter of 21, revenue was $ 71.9 million, just below the $ 80.5 million reported for the year-ago quarter, while earnings per share were 10 cents per share a year ago to 3 cents in the current year report. On a more positive note, the company saw bookings jump from $ 75.7 million a year ago to $ 92.1 million, and its backlog of $ 203.1 million increased 11% year over year. A few days after the results were published, CECO announced that it had received a major order from a large semiconductor chip manufacturer. The chip industry regularly works with a wide variety of rare metals and other pollutant chemicals – and CECO’s new contract includes scrubber and exhaust systems, as well as circulating pumps – elements that the chip maker needs to meet or exceed environmental regulations. Reaching out to the analyst community, Amit Dayal, an analyst at HC Wainwright, believes the company is busy and has a bright future. “The company appears to be recovering from COVID-19 headwinds. Bookings increased to $ 92.1 million for the quarter. The last time bookings were at or above these levels was in mid-2019 … In the next few quarters, we expect engineered systems sales to improve as the broader energy markets improve. Management highlighted that the environment for proposal proposals from the company with an order pipeline of over USD 2.0 billion has improved, which we believe should support further order improvement in the next few quarters, ”said the 5-star analyst. Based on the above, the daily rate CECE reports a buy rating, and its target price of USD 15 shows confidence in a 100% upward movement for the coming year. (To see Dayal’s track record, click here.) We’re again looking at a stock with a unanimous consensus rating for strong buy – based on 3 positive Wall Street ratings. The shares sell for $ 7.50 and have an average price target of $ 12, indicating a 12-month move higher of 60%. (See CECE stock analysis on TipRanks.) To find great ideas for trading small-cap stocks at attractive valuations, visit TipRanks ‘Best Stocks to Buy, a newly launched tool that brings together all of the insights into TipRanks’ stocks . Disclaimer: The opinions expressed in this article are solely those of the presented analysts. The content is intended to be used for informational purposes only. It is very important that you do your own analysis before making any investment.