It’s safe to say the stock market is on fire right now, with multiple indices hitting record highs recently. However, with interest rates still up and inflation rates showing signs of stickiness, it’s best to be slightly cautious. Moreover, some of the biggest names in the investing punditry have discussed how current trends swing into bubble territory. Hence, in such a scenario, it’s prudent to consider the best $10 stock to buy.
In a bull market, wagering on undervalued stocks, specifically those under the $10 mark, provides a greater margin of safety and a more attractive capital appreciation. These stocks are typically overlooked or mispriced due to multiple factors, which makes them attractive picks during a bull run. With that said, three attractive stocks fit the bill, offering healthy upside potential ahead.
Nerdy (NRDY)
We’re a year into the artificial intelligence (AI) revolution, which has taken things up a notch or two for the stock market. Businesses with the slightest exposure to AI saw their stock prices soar in the past year. However, some companies, like AI-powered online learning platform Nerdy (NYSE:NRDY), weren’t so lucky. Though its fundamentals shined last year, the market hasn’t yet bought into NRDY stock’s AI story. For perspective, the stock shed 15% of its value last year and is ticking in the red year-to-date (YTD).
Nevertheless, its business continues to grow its top line at a healthy pace, with fourth quarter (Q4) sales of $55.1 million, up 32% YOY, beating estimates by $330,000. Moreover, its active members at the close of last year stood at 40,700, up a remarkable 101% YOY. Additionally, the company expects to deliver positive operational cash flows this year and roughly 24% YOY growth in sales at the midpoint. As a result, Tiprank’s analysts expect a massive 56% upside in price from current levels.
Arcadium Lithium (ALTM)
Arcadium Lithium (NYSE:ALTM) stock is an excellent value play in lithium mining, trading under five times trailing twelve-month earnings. It emerged as one of the largest integrated lithium producers in the world after the all-stock merger of Allkem and Livent earlier this year. Moreover, according to its CEO Paul Graves, the merger offers massive benefits in limiting risk for overlapping growth projects. Additionally, it enables quicker progress regarding capital efficiency improvements in its key mining areas in Argentina and Québec.
ALTM stock is cheap, and it has everything to do with the falling lithium prices. Though market estimates have differing views on a potential rebound in lithium prices, CEO Graves foresees a snapback. He feels that lithium expansion projects at current prices make little sense, and the likely demand/supply imbalance should lead to a major recovery. Tiprank’s analysts concur, assigning a ‘moderate buy’ rating expecting a 66% upside from current levels.
Blade Air Mobility (BLDE)
Flying car stocks have been trending for several months, but urban short-haul aviation company Blade Air Mobility (NASDAQ:BLDE) is flying under the radar. BLDE stock is down 28% YTD, trading for just 0.80 times forward sales estimates.
Despite its lackluster stock market performance, there’s plenty to like about BLDE. Firstly, it boasts a unique business model, providing air mobility alternatives to America’s congested ground pathways. However, its more adventurous venture in fast organ transportation is what I sold on it. Its Trinity Organ Placement Services (TOPS) attempts to leverage flying cars for fast organ transport, a potentially lucrative long-term market.
In its recently released Q4 report, we saw how revenues from organ transport rose an eye-catching 48% to $32 million. Moreover, the company made major additions to its aircraft fleet, acquiring eight dedicated sets for its organ transport business. Also, you can’t take the short-distance segment lightly either, as it posted a healthy 13.6% increase in sales to $10.7 million in Q4.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
