At Zacks, we try to avoid labeling stocks as “cheap” or “expensive.” Instead, we opt to look beyond a stock’s face value, and our system puts an emphasis on earnings estimate revisions to find stocks that will hopefully be winners for investors.
The U.S.-China trade war remains a concern, and currency worries took center stage this week. And the larger global economic picture appears to be heading in the wrong direction. But this doesn’t mean it’s time to move completely into safe havens. In fact, low-priced stocks can still be attractive to investors at the moment.
When searching for these low-priced stocks, we still look for similar trends in growth, value, and momentum. Then we apply the Zacks Rank to properly analyze the potential that these companies have. We are also 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 that investors might want to consider as August gets under way. Each of these three stocks is currently trading for less than $10 a share and holds a Zacks Rank #1 (Strong Buy) or #2 (Buy) at the moment.
1. Pivotal Software, Inc. PVTL
Prior Close: $8.63 USD
Pivotal Software is a cloud-native platform provider that helps businesses transform their legacy portfolios to the cloud. The San Francisco-based firm hopes to reduce time, cost, and operational inefficiencies, and enables its customers, which include Ford F, Southwest LUV, Home Depot HD, the United States Air Force, and many other giants, to build and run software applications on its cloud platform. The company also recently made Fast Company ’s ‘Best Workplaces for Innovators’ list that features everyone from Amazon AMZN to Morgan Stanley MS.
PVTL shares are down since the firm went public in April 2018 and slipped despite posting stronger-than-projected Q1 fiscal 2020 results in early June. With that said, Pivotal’s outlook appears strong. Our current Zacks Consensus Estimates call for its fiscal 2020 revenue to surge roughly 16% to $760.4 million, with 2021 projected to come in 17.5% higher at $893.4 million. Meanwhile, the company is expected to jump from an adjusted loss of $0.28 per share in 2019 to -$0.15 this year. Better yet, PVTL looks poised to post +$0.01 EPS in 2021. Pivotal is currently a Zacks Rank #2 (Buy) that sports an “A” grade for Growth in our Style Scores system.
2. Ballard Power Systems Inc. BLDP
Prior Close: $4.45 USD
Ballard Power Systems aims to provide fuel cell power for a “sustainable planet.” The Vancouver, Canada-headquartered firm builds fuel cell products that aim to reduce customer costs and risks. Ballard’s 12-month order book surged 66% to $126.7 million at the end of the second quarter, where is also posted better-than-expected earnings. “The global megatrend toward electrification of mobility is accelerating and putting increased momentum behind fuel cell-based power for motive applications,” CEO Randy MacEwen said in prepared remarks on July 31. “There are clear signals that the hydrogen and fuel cell industry is at an exciting stage in its evolution.”
Shares of BLDP have skyrocketed 94% in 2019. The company’s Q3 revenue is projected to pop 18.8% from the prior-year quarter to reach $25.6 million. Meanwhile, Ballard’s full-year fiscal 2019 revenue is expected to come in flat at $96.6 million, with adjusted earnings projected to come in the same as 2018 as well. Peeking further down the road, Ballard’s 2020 sales are set to soar 40% over our current-year estimate to $135.6 million, with EPS projected to climb 54%. Ballard is a Zacks Rank #1 (Strong Buy) at the moment that holds a “B” grade for Momentum. And investors should see BLDP as a pure growth bet.
3. Digital Turbine, Inc. APPS
Prior Close: $5.58 USD
Digital Turbine tries to connect OEMs, mobile operators, and publishers with advertisers and app developers. APPS, which operates in our Internet – Software industry, has seen its stock price soar 300% over the last 52 weeks and 55% in the past month alone. Digital Turbine posted better-than-projected Q1 fiscal 2020 earnings and revenue results on August 5. The positivity helped APPS’ earn some longer-term earnings estimate revisions, which help it hold a Zacks Rank #1 (Strong Buy) right now.
The Austin, Texas-based company is projected to see its full-year fiscal 2020 revenue jump 26.4% to $130.89 million. At the bottom end of the income statement, Digital Turbine’s adjusted fiscal 2020 EPS figure is expected to climb 75% to reach $0.14 a share. APPS also earns an “A” grade for Growth in our Style Scores system and its forward price/sales ratio of 3.4 marks a discount compared to its industry’s 6.0 average.
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Southwest Airlines Co. (LUV) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Digital Turbine, Inc. (APPS) : Free Stock Analysis Report
Ford Motor Company (F) : Free Stock Analysis Report
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Ballard Power Systems, Inc. (BLDP) : Free Stock Analysis Report
Morgan Stanley (MS) : Free Stock Analysis Report
Pivotal Software, Inc. (PVTL) : Free Stock Analysis Report
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