Stocks trading under $10 can be attractive for investors looking to scoop up some cheap shares. Unfortunately, quality stocks trading for less than $10 are few and far between. Stocks priced at this level can be a red flag for investors that something serious is wrong with a company. Many of these stocks have challenged underlying business models or difficult near-term outlooks. Despite those challenges, the CFRA Research analyst team recommends these cheap, high-quality stocks that could be excellent buying opportunities for frugal investors in 2024.
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Here are nine of the best stocks to buy under $10, according to CFRA:
| Stock | Implied upside from March 15 close |
| Telefonica SA (ticker: TEF) | 6.1% |
| Nokia Corp. (NOK) | 49.1% |
| Korea Electric Power (KEP) | 7.6% |
| Aegon Ltd. (AEG) | 12.8% |
| Arcadium Lithium PLC (ALTM) | 76.2% |
| Telecom Italia SPA (OTC: TIIAY) | 51.5% |
| Crescent Point Energy Corp. (CPG) | 4.5% |
| iQiyi Inc. (IQ) | 62.5% |
| Polestar Automotive Holding UK PLC (PSNY) | 84% |
Telefonica SA (TEF)
Telefonica is the leading telecommunications company in Spain. The stock pays a 7.6% dividend, the highest on this list and a rarity among stocks priced under $10. Analyst Adrian Ng says Telefonica has made several key restructuring maneuvers that have helped streamline its business. Telefonica acquired E-Plus in Germany and GVT in Brazil. The company also combined its U.K. telecom assets in a joint venture deal with Liberty Global Ltd. (LBTYA
) and exited Central America. Ng says Telefonica now has a strong position in its core markets. CFRA has a “buy” rating and $4.50 price target for TEF stock, which closed at $4.24 on March 15.
Nokia Corp. (NOK)
Nokia is a telecom equipment and digital map data vendor that also licenses intellectual property to third parties. Analyst Keith Snyder says the initial stages of the 5G network upgrade cycle in North America and China are gaining momentum, and he anticipates the current cycle will be larger and will last longer than previous upgrade cycles. Snyder says Nokia’s North American mobile networks business struggled in 2023, but he projects Nokia will overcome mobile weakness and return to earnings and revenue growth in 2024. CFRA has a “buy” rating and $5.50 price target for NOK stock, which closed at $3.69 on March 15.
Korea Electric Power (KEP)
Korea Electric Power is an integrated electric utility company that transmits and distributes electricity in South Korea. Korea Electric shares are up 28.1% this year through March 15, the best performance of any stock on this list. Analyst Ahmad Halim says higher tariffs will support demand and offset a projected slowdown in Korea’s economy in 2024. Halim says he is encouraged that Korea Electric reported an operating profit in the most recent quarter. He says investors should expect supportive government policies as it owns 51.1% of Korea Electric. CFRA has a “buy” rating and $10 price target for KEP stock, which closed at $9.29 on March 15.
Aegon Ltd. (AEG)
Aegon is a Dutch insurance company that offers insurance, savings, pension, and investment products and services around the world. Analyst Jeff Lye says Aegon’s management team has a proven track record, and he is bullish on the company’s plan to focus on strategic assets that reduce capital ratio volatility and generate an attractive return on capital. Lye says Aegon is committed to dividends and buybacks, and he projects a cash yield to shareholders in the double-digit percentage range over the next 12 months. CFRA has a “buy” rating and $6.50 price target for AEG stock, which closed at $5.76 on March 15.
[See: Artificial Intelligence Stocks: The 10 Best AI Companies.]
Arcadium Lithium PLC (ALTM)
Arcadium Lithium produces lithium chemical products used in portable electronics, electric vehicles and stationary storage facilities. Analyst Emily Nasseff Mitsch says Arcadium shares are undervalued given the strong demand outlook for lithium in both the short and long term. Mitsch says the political and environmental push for electric vehicles, including tax credits of up to $7,500 for U.S. EV purchases, will help facilitate the transition of the global auto market to an electric future and generate tremendous demand for lithium-containing batteries. CFRA has a “buy” rating and $8 price target for ALTM stock, which closed at $4.54 on March 15.
Telecom Italia SPA (OTC: TIIAY)
Telecom Italia is the leading fixed-line and wireless telecommunications provider in Italy. The company plans to split off its network management business into a separate company. Telecom Italia shares are down 27.8% through March 15 this year, the worst performance on this list. Ng says the sell-off is a buying opportunity given the plan to divest assets to reduce debt, including selling its network to KKR & Co. Inc. (KKR). Ng says Telecom Italia will continue to face revenue pressures in its main markets, but Brazil remains a growth driver. CFRA has a “buy” rating and $3.50 price target for TIIAY stock, which closed at $2.31 on March 15.
Crescent Point Energy Corp. (CPG)
Crescent Point Energy is a Canadian oil and gas exploration and production company that has assets in Western Canada, Utah and North Dakota. Analyst Jonnathan Handshoe says the company’s guidance to return 60% of its projected $613 million in excess free cash flow to shareholders in 2024 is reasonable given current forecasts of 2024 average WTI crude oil prices of $78 per barrel. Crescent Point also anticipates a significant bump in production in 2024 following its Hammerhead Energy acquisition in the fourth quarter. CFRA has a “buy” rating and 11 Canadian dollar ($8.12) price target for CPG stock, which closed at $7.77 on March 15.
iQiyi Inc. (IQ)
iQiyi is a leading Chinese streaming video platform that is often compared to U.S. streaming platform Netflix Inc. (NFLX). Analyst Siti Salikin says iQiyi has a tiered membership model that caters to a wide range of different customer types, an attractive mix of premium and on-demand content, and an innovative monetization approach. The company accounted for seven of the 10 most watched dramas in China in 2023, which Salikin says is a testament to iQiyi’s ability to produce high-quality content that will likely continue to create value. CFRA has a “buy” rating and $6.50 price target for IQ stock, which closed at $4 on March 15.
Polestar Automotive Holding UK PLC (PSNY)
Polestar Automotive designs and manufactures electric vehicles. The company has two EV models on the market and expects to launch three additional models by 2025. Analyst Garrett Nelson says Polestar has a more attractive growth outlook than many of its EV peers, especially given the company’s significant exposure to EV-friendly European markets like Sweden and the U.K. Polestar has increased its deliveries fivefold over the past two years and has already achieved gross profitability. Nelson says the launch of new premium EV models will further improve Polestar’s margins. CFRA has a “buy” rating and $3 price target for PSNY stock, which closed at $1.63 on March 15.
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9 Best Cheap Stocks to Buy Under $10 originally appeared on usnews.com
Update 03/18/24: This story was published at an earlier date and has been updated with new information.
