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.
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Stocks priced at this level can be a red flag for investors, suggesting something is seriously wrong with a company. Many of these stocks have challenged underlying business models or difficult near-term outlooks. However, the CFRA analyst team has identified nine cheap, high-quality stocks that could be excellent buying opportunities in 2024 for frugal investors. Here are nine of the best stocks to buy under $10, according to CFRA:
| Stock | Implied change from Aug. 23 close |
| Telefonica SA (ticker: TEF) | 10.4% |
| Nokia Corp. (NOK) | 7.9% |
| Snap Inc. (SNAP) | 48.5% |
| Kinross Gold Corp. (KGC) | 13.6% |
| Aegon Ltd. (AEG) | 22.5% |
| Korea Electric Power Corp. (KEP) | -0.5% |
| Telecom Italia SPA (OTC: TIIAY) | 17.2% |
| Veren Inc. (VRN) | 30.6% |
| Patterson-UTI Energy Inc. (PTEN) | 39.6% |
Telefonica SA (TEF)
Telefonica is the leading telecommunications company in Spain. The stock pays a 7.2% dividend, the highest on this list and a rarity among stocks priced under $10. Analyst Adrian Ng says Telefonica has made several major moves to restructure its business and improve its balance sheet. The company has exited the Central American market and acquired E-Plus in Germany and GVT in Brazil. It has also combined its U.K. telecom assets in a joint venture deal with Liberty Global Ltd. (LBTYA). Ng says Telefonica has positive business momentum. CFRA has a “buy” rating and $5 price target for TEF stock, which closed at $4.53 on Aug. 23.
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 global 5G network investment cycle is gaining momentum, particularly in North America and China. Snyder says the 5G upgrade cycle will be larger and longer-lasting than previous network upgrades, supporting Nokia’s demand for years to come. Nokia is optimistic it can regain lost market share and outgrow industry peers moving forward. Snyder says the company has demonstrated solid execution and improved earnings visibility. CFRA has a “buy” rating and $4.50 price target for NOK, which closed at $4.17 on Aug. 23.
Snap Inc. (SNAP)
Snap is the parent of Snapchat, and the company is a leading mobile-focused social media advertising company. The stock is down 44.3% year to date, the worst performance of any stock on this list. Analyst Angelo Zino says the weakness is a buying opportunity for long-term investors. Zino says Snap is a highly speculative investment, but he believes the company has opportunities to improve its fundamental business metrics and grow its installed user base. He projects Snapchat can reach 1 billion monthly active users within two years. CFRA has a “buy” rating and $14 price target for SNAP stock, which closed at $9.43 on Aug. 23.
Kinross Gold Corp. (KGC)
Kinross is a Canadian gold miner that has a diversified portfolio of properties in Canada, the U.S., Brazil, Chile and Mauritania. Kinross shares are up 53.3% year to date, the best performance of any stock on this list. Analyst Matthew Miller says Kinross has an attractive valuation, even after its big 2024 rally. Miller says Kinross has excellent growth prospects and will benefit from rising gold prices. He says the company’s Great Bear property in Ontario could be a top-tier asset in coming years. CFRA has a “buy” rating and $10.39 price target for KGC stock, which closed at $9.15 on Aug. 23.
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 free cash flow and operating capital generation are within reach. Lye is bullish on the company’s strategy of focusing on strategic assets that reduce capital ratio volatility and generate an attractive return on capital. Meanwhile, Aegon is extracting capital from its non-core financial assets business, and Lye says the share buyback program announced earlier this year is reassuring to shareholders. CFRA has a “buy” rating and $7.50 price target for AEG stock, which closed at $6.12 on Aug. 23.
[SEE: 9 Best Cheap Stocks to Buy Under $5.]
Korea Electric Power Corp. (KEP)
Korea Electric Power is an integrated electric utility company that transmits and distributes electricity in South Korea. Analyst Siti Salikin says a slowdown in Korea’s economy will continue to weigh on Korea Electric’s demand in 2024, but higher tariffs will help offset those headwinds. Salikin says Korea Electric’s four consecutive quarters of operating profit are encouraging. In addition, the Korean government’s 51.1% majority ownership stake in Korea Electric will likely ensure favorable tariffs and other policies for the company in the years ahead. CFRA has a “buy” rating and $8 price target for KEP stock, which closed at $8.04 on Aug. 23.
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 $21 billion. Ng says the recent restructuring deals are in line with his expectations for Telecom Italia to continue divesting underperforming assets to reduce its debt levels and improve its balance sheet. He says the company will focus on its high-margin service revenue. CFRA has a “buy” rating and $3 price target for TIIAY stock, which closed at $2.56 on Aug. 23.
Veren Inc. (VRN)
Veren is a Canadian oil and gas exploration and production company that owns properties in western Canada, Utah and North Dakota. Analyst Stewart Glickman notes that Veren used about 60% of its roughly $144 million in free cash flow for share buybacks and the stock’s 4.5% dividend. The other 40% went toward reducing Veren’s debt load. Glickman says Veren’s improved credit rating can reduce interest expense. CFRA has a “buy” rating and $9.65 price target for VRN stock, which closed at $7.39 on Aug. 23.
Patterson-UTI Energy Inc. (PTEN)
Patterson-UTI Energy is a U.S. oil and gas drilling company that provides U.S. land drilling services. Glickman says the stock is trading at a significant valuation discount based on its earnings before interest, taxes, depreciation and amortization. He says Patterson-UTI customers have been taking a conservative approach to spending, but the company is still an attractive investment given its NexTier assets’ free cash flow potential. Patterson-UTI will also benefit from rising data center power demand, and Glickman projects expanding drilling activity in 2025. CFRA has a “strong buy” rating and $13 price target for PTEN stock, which closed at $9.31 on Aug. 23.
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9 Best Cheap Stocks to Buy Under $10 originally appeared on usnews.com
Update 08/26/24: This story was previously published at an earlier date and has been updated with new information.
