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.
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There are still some good buys out there, however, and the CFRA analyst team has identified these cheap, high-quality stocks that could be excellent opportunities in 2024 for frugal investors. Here are eight of the best stocks to buy under $10, according to CFRA:
| Stock | Implied upside from April 22 closing price |
| Telefonica SA (ticker: TEF) | 3.2% |
| Nokia Corp. (NOK) | 49.1% |
| Aegon Ltd. (AEG) | 7.3% |
| Korea Electric Power (KEP) | 31.2% |
| Telecom Italia SPA (OTC: TIIAY) | 49.6% |
| Arcadium Lithium PLC (ALTM) | 108.3% |
| iQiyi Inc. (IQ) | 50.8% |
| Polestar Automotive Holding UK PLC (PSNY) | 123.9% |
Telefonica SA (TEF)
Telefonica is the leading telecommunications company in Spain. The stock pays a 7.4% dividend, the highest on this list and a rarity among stocks priced under $10. Analyst Adrian Ng says Telefonica has made several aggressive restructuring moves to reinforce its core business and improve its balance sheet. Those changes include exiting Central America, acquiring E-Plus in Germany and GVT in Brazil, and combining its U.K. telecom assets in a joint venture deal with Liberty Global Ltd. (LBTYA
). Ng says Telefonica has positive business momentum in 2024. CFRA has a “buy” rating and $4.50 price target for TEF stock, which closed at $4.36 on April 22.
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 global 5G infrastructure upgrade cycle are picking up steam in North America and China, and he predicts the current cycle will be larger and longer-lasting than previous upgrade cycles. These upgrade investments will support Nokia’s demand in coming years, and Snyder says the company is confident it can regain lost market share and outgrow its industry peers. CFRA has a “buy” rating and $5.50 price target for NOK stock, which closed at $3.69 on April 22.
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 2024 financial targets for operating capital generation and free cash flow are within reach, and the company’s management has a strong track record of execution. Lye says Aegon’s aggressive capital return program will continue to support its stock price. He says the company’s focus on strategic assets that reduce capital ratio volatility and generate an attractive return on capital creates value for investors. CFRA has a “buy” rating and $6.50 price target for AEG stock, which closed at $6.06 on April 22.
Korea Electric Power (KEP)
Korea Electric Power is an integrated electric utility company that transmits and distributes electricity in South Korea. Analyst Ahmad Halim says a slowdown in the Korean economy will weigh on electricity demand in 2024, but higher tariffs should help offset that demand weakness. Halim says he is encouraged by Korea Electric’s operating profit in the most recent quarter, which was only its second profitable quarter since the first quarter of 2021. Halim says the Korean government’s 51% ownership stake in Korea Electric will ensure favorable policy measures. CFRA has a “buy” rating and $10 price target for KEP stock, which closed at $7.62 on April 22.
[See: Artificial Intelligence Stocks: The 10 Best AI Companies.]
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 and has agreed to sell its network to KKR & Co. Inc. (KKR) in a deal valued at about $24 billion. Ng says the company’s restructuring efforts are no surprise given its need to reduce debt levels. He is bullish on the company’s asset sales but says large Telecom Italian shareholder Vivendi may limit additional deals moving forward. CFRA has a “buy” rating and $3.50 price target for TIIAY stock, which closed at $2.34 on April 22.
Arcadium Lithium PLC (ALTM)
Arcadium Lithium produces lithium chemical products used in portable electronics, electric vehicles and electricity storage facilities. The stock is down 48.6% this year, the worst performance on this list. Analyst Emily Nasseff Mitsch says she is bullish on the near- and long-term demand growth outlook for lithium given her expectations for booming electric vehicle demand. Mitsch says the $7,500 U.S. EV tax credit will encourage U.S. EV adoption. In addition, she says Arcadium shares are attractively valued and the company has a healthy balance sheet. CFRA has a “buy” rating and $8 price target for ALTM stock, which closed at $3.84 on April 22.
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 is bullish on iQiyi’s large library of premium, on-demand content and its innovative monetization model centered on tiered membership services that appeal to a wide range of different customers. In 2023, seven of the 10 most watched dramas in China were iQiyi originals, which Salikin says is a testament to the company’s in-house content creation. The company has another 280 original creations planned for 2024. CFRA has a “buy” rating and $6.50 price target for IQ stock, which closed at $4.31 on April 22.
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 attractive growth prospects relative to most competing EV manufacturers. In fact, the company has already achieved gross profitability and has increased its EV deliveries by a factor of five in just two years. Nelson says Polestar’s high exposure to EV-friendly Europe differentiates it from other U.S. EV plays, and higher-priced model launches will boost overall margins. CFRA has a “buy” rating and $3 price target for PSNY stock, which closed at $1.34 on April 22.
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8 Best Cheap Stocks to Buy Under $10 originally appeared on usnews.com
Update 04/23/24: This story was published at an earlier date and has been updated with new information.
