In the market, giants often steal the limelight. However, an intriguing narrative exists woven by lesser-known yet promising stocks priced under $10. Enterprising companies have silently amassed momentum, signaling an imminent surge in their value. The terrain of consumer electronics and cutting-edge technology systems hosts these three underdogs, each concealing a treasure trove of growth potential waiting to be unearthed.
Amidst the ever-evolving landscape of innovation and market dynamics, these companies have intricately carved their path to success. The first one’s strategic product launches and expansive retail endeavors, the second one’s diversification beyond automotive realms and the third one’s groundbreaking underwater technologies mark pivotal strides toward market dominance.
Beyond the stock prices, delve into the hidden narratives of resilience, adaptability and innovation driving these companies’ growth. Read more to uncover these undervalued stocks‘ latent potential and promising trajectories.
GoPro (GPRO)
GoPro (NASDAQ:GPRO) delivers substantial growth in performance. For instance, in Q3 2023, the company exceeded revenue expectations at $294 million, surpassing non-GAAP earnings per share targets. This performance reflected the company’s ability to forecast effectively and indicated a positive market response to its products and strategies. Thus, the sequential growth of 31% and a 16% year-over-year increase in total camera unit sales suggest effective demand capture.
Furthermore, the subscription service maintained its value, evident in its 20% year-over-year growth, reaching 2.5 million subscribers. This results in solid attachment and retention rates, indicating strong customer engagement. Launching a desktop version of the Quik app for Mac OS and introducing a premium plus $99 subscription tier demonstrates GoPro’s focus on offering enhanced features and increased cloud storage.
Fundamentally, these impressive figures hint at effective product positioning, customer engagement, and a solid marketing approach. On the product side, the launch of the Hero 12 Black at $399 represented a key strategic move by GoPro. The product has succeeded and indicates its resonance with both professional and casual users. Thus, these leads consolidate GoPro’s position as an industry benchmark.
Additionally, GoPro’s focus on expanding its retail presence has shown impressive results. The company met and exceeded its target of adding 2K new retail doors by the end of 2023 (+25% annual increase). By fostering strong partnerships and investing in retail channels, GoPro expanded its reach and accessibility to potential customers.
The planned 30% increase in retail doors by 2024 indicates a proactive approach to market penetration. Hence, by strategically positioning products in retail spaces, GoPro aims to capitalize on physical retail environments to drive sales and brand recognition.
BlackBerry (BB)
BlackBerry’s (NYSE:BB) IoT business experienced notable revenue growth. Most recently, the business has achieved a 12% sequential and 8% year-on-year increase in Q3 fiscal 2024. The revenue streams were diversified, with royalties accounting for 44%, development seats for 32%, and services contributing 24% of the total revenue. The significant increase in revenue despite industry-level headwinds indicates the resilience and potential of BlackBerry’s IoT segment.
Fundamentally, the growth was primarily driven by the automotive sector, particularly Advanced Driver Assistance Systems (ADAS). BlackBerry secured crucial design wins with leading automakers globally, expanding its footprint in ADAS solutions and automotive operating systems. These wins include partnerships with European and Asian automakers for the Real-Time Operating System (RTOS) and ADAS platforms. This illustrates BlackBerry’s credibility and growth potential within the automotive industry.
Notably, BB is expanding beyond automotive, and its success extended beyond automotive, diversifying into various sectors such as industrial automation, medical devices, and autonomous defense vehicles. This expansion indicates the scalability and adaptability of BlackBerry’s IoT solutions across different industries, reducing reliance on a single sector for revenue generation.
Moreover, the upcoming launch of QNX SDP 8.0, with its promised enhanced performance and scalability, is poised to unlock new opportunities in the IoT space. Additionally, IVY’s progress, Proof of Concept trials, growing ecosystem, and demonstrations at CES suggest potential growth avenues outside the automotive sector.
Finally, BlackBerry’s cybersecurity business is another impressive company growth aspect. The business’s revenue soared to $114 million, marking a substantial 44% sequential and 8% year-over-year increase. The noteworthy improvement in gross margin, rising by 0.14% to 68%, underscores the efficiency and profitability of BlackBerry’s cybersecurity offerings.
Coda Octopus (CODA)
Coda Octopus (NASDAQ:CODA) has established an exemplary track record of profitability. The company has boasted consistent profitability in 45 out of the last 50 quarters and has maintained profitability for the last 12 consecutive years. Such an extended period of sustained profitability highlights the company’s robust operational efficiency and adaptability.
Furthermore, Coda Octopus has invested in developing innovative underwater products and solutions. The Echoscope PIPE and the Diver Augmented Vision Display System (DAVD) are significant strengths driving the company’s growth potential. Over the past four years, the company has dedicated substantial resources to advancing these cutting-edge technologies. Hence, these investments align them with its growth strategy and market demands.
The Echoscope PIPE, a real-time 3D imaging sonar, caters to emerging defense and underwater vehicle market requirements. Favorably, its unique capabilities in providing high-resolution, real-time imaging have garnered attention from defense entities, positioning Coda Octopus as a frontrunner in offering advanced sensor technology for underwater applications.
On the other hand, the DAVD is transitioning from the Navy’s research and development (R&D) phase to its field adoption phase. This progress signifies a crucial milestone for the company. The successful implementation and training events with entities like the Southwest Regional Maintenance Center (SWRMC) and the Underwater Construction Team (UCT) demonstrate this technology’s operational integration and usability within critical defense operations.
Notably, there are positive feedback and adoption intentions from European offshore service providers and Japanese companies. This underscores the market’s recognition of the DAVD’s potential to enhance safety and efficiency in underwater operations.
Overall, by further refining and expanding the capabilities of its Echoscope and DAVD solutions, the company can capture a larger market share and penetrate new segments.
As of this writing, Yiannis Zourmpanos held a long position in GPRO. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
