- Investing in stocks priced below $20 can provide opportunities for potential growth without requiring significant capital.
- In the spirit of Black Friday, here are five stocks under $20 that are proving to be undervalued gems.
- Each of these stocks offers a compelling value proposition, trading at discounts to their growth potential.
- Looking for more actionable trade ideas? Subscribe here to get 60% off InvestingPro this Black Friday!
In the spirit of Black Friday, we’ve rounded up five exciting stocks that are trading under $20 and represent exceptional value opportunities in today’s market.
These stocks – Mobileye (NASDAQ:), Barrick Gold (NYSE:), Lyft (NASDAQ:), Cleveland-Cliffs (NYSE:) and Snap (NYSE:) – are undervalued and offer considerable upside potential, as highlights InvestingPro’s fair value model.
With Black Friday’s emphasis on value, these picks fit perfectly into the theme of smart shopping – this time for your wallet.
1. Mobileye
Mobileye, a pioneer in advanced driver assistance systems (ADAS) and autonomous driving technologies, is transforming the automotive industry.
The global trend toward vehicle safety and autonomy is accelerating the demand for ADAS technologies. Through its partnerships with major automakers and increasing regulatory requirements for safety, Mobileye is well-positioned to lead the autonomous driving revolution. Recent innovations in its next-generation chips and mapping technology further strengthen its growth trajectory.
Source: InvestingPro
InvestingPro’s fair value model suggests the stock is substantially undervalued, making it an attractive buy at current levels. Trading at $18.03, InvestingPro estimates its fair value at $21.34, indicating 18.4% upside potential.
2. Barrick Gold
- Current price: $17.57
- Fair value estimate: $21.77 (+23.9% increase)
- Market capitalization: $30.8 billion
Barrick Gold, one of the world’s largest producers of and, remains a safe haven in a context of market uncertainty. Persistent inflation, geopolitical tensions and tendencies of central banks to buy gold are driving demand for gold as a hedge.
Additionally, Barrick’s operational efficiency, strong cash flow and focus on sustainability in mining give it an edge over competitors, ensuring consistent long-term returns.
Source: InvestingPro
The stock’s undervaluation, according to InvestingPro’s fair value models, indicates a compelling opportunity for investors. Trading at $17.57, its fair value target is set at $21.77, representing an upside of 23.9%.
3. Lyft
- Current price: $17.18
- Estimated fair value: $24.04 (+39.9% increase)
- Market capitalization: $7.1 billion
Lyft, one of the biggest players in the ride-hailing industry, has revamped its business strategy to prioritize profitability. The company is capitalizing on growing consumer demand for shuttle services and ride-sharing solutions.
Strategic partnerships, advances in autonomous vehicle technology and a lean cost structure are helping the company regain momentum. Its expansion into new markets and premium services could further unlock shareholder value.
Source: InvestingPro
Current fair value estimates indicate that LYFT stock is trading at a significant discount. InvestingPro’s fair value model projects a potential upside of 39.9% from the current market value of $17.18. This would bring shares closer to their fair value target of $24.04.
4. Cleveland-Cliffs
- Current price: $12.14
- Fair value estimate: $17.35 (+42.9% increase)
- Market capitalization: $6 billion
Cleveland-Cliffs, the largest producer of flat-rolled steel in North America, is a critical supplier to the automotive and construction industries.
Infrastructure spending initiatives and the resurgence of domestic manufacturing are major growth catalysts. Cleveland-Cliffs’ vertically integrated operations provide cost advantages, allowing it to better serve automakers and contractors. Its commitment to greener steel production aligns with the trend toward sustainability in industrial processes.
Source: InvestingPro
The stock’s current valuation suggests that it is significantly undervalued, as indicated by InvestingPro’s AI models. Trading at $12.14, there is room for a 42.9% increase, which would bring it closer to its fair value pegged at $17.35 per share.
5. Snap
- Current price: $11.61
- Fair value estimate: $13.71 (+18.1% increase)
- Market capitalization: $19.5 billion
Snap, the parent company of Snapchat, is a leading innovator in augmented reality (AR) and social media. Its augmented reality-based advertising solutions resonate with brands looking to reach younger audiences.
The Santa Monica, Calif.-based tech company’s focus on improving user engagement through new features and partnerships is paying off. As advertising budgets recover, Snap’s innovative platform offers businesses unique ways to connect with their target demographics, driving revenue growth.
Source: InvestingPro
According to InvestingPro’s fair value model, SNAP trades at a steep discount. There is a potential upside of 18.1% from its current price of $11.61, which would bring it closer to its fair value of $13.71 per share.
Final Thoughts
As the holiday season calls for wise purchases, these five stocks represent exceptional opportunities for your portfolio. Whether driven by innovation, macroeconomic trends or market-specific headwinds, these bargains are well positioned for long-term growth.
Whether you are a novice investor or a seasoned trader, InvestingPro can open up a world of investment opportunities for you while minimizing risks in a challenging market environment.
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Warning : At the time of writing, I am long the S&P 500 and through the SPDR® S&P 500 ETF and the Invesco QQQ Trust ETF. I am also long the Technology Select Sector SPDR ETF (NYSE:).
I regularly rebalance my portfolio of individual stocks and ETFs based on an ongoing assessment of risks related to the macroeconomic environment and the financial situation of companies.
The opinions expressed in this article are those of the author alone and should not be considered investment advice.
