If soaring consumer prices got you down, you may want to consider these value stocks under $20. Sure, the market may be booming during this unique post-pandemic cycle. Still, there’s always an opportunity to be discovered.
Basically, it comes down to simple math. I can’t nail down a specific number. But apparently, if you include the pink sheets – that is, the over-the-counter (OTC) securities – there are more than 10,000 publicly traded companies available for retail investors.
You’re telling me that no good deals exist? That can’t possibly be correct – you just gotta know where to look. Here are seven analyst-backed value stocks under $20 to consider.
Hudson Technologies (HDSN)
One of the lesser-known entities among value stocks under $20, Hudson Technologies (NASDAQ:HDSN) engages in the provision of solutions to recurring problems within the refrigeration industry. Per its public profile, the company mainly engages in the sale of refrigerant and industrial gas. It also provides refrigerant management services. Since the start of the year, HDSN stock slipped almost 14%.
Now, that doesn’t particularly sound encouraging. However, it could be a blip on the road to stronger returns. Over the past 52 weeks, shares gained nearly 49%. Right now, HDSN trades at a forward earnings multiple of 10.71X. In contrast, the sector median stands at 16.51X.
Last fiscal year, Hudson mostly beat expectations for earnings per share. During the time that it didn’t in the fourth quarter, the company matched the EPS expectation of 8 cents. Overall, the positive earnings surprise in 2023 came out to 11.45%.
Analysts rate HDSN stock a unanimous strong buy with an average price target of $15.50.
Lincoln Educational Services (LINC)
Lincoln Educational Services (NASDAQ:LINC), along with its subsidiaries, provides various career-oriented post-secondary education services to high school graduates and working adults. It operates in two segments: Campus Operations and Transitional. Mainly, Lincoln offers associate’s degrees and other certifications in various professional fields. Since the beginning of this year, LINC gained over 2% of its equity value.
One factor that makes LINC a candidate for value stocks under $20 is its trailing-year earnings multiple of 11.76X. That’s lower than the sector median 19.63X. Further, its enterprise-value-to-revenue multiple sits at 0.96X. To be fair, the company had some shaky performances last fiscal year. However, for 2024, analysts anticipate revenue to land at just under $415 million. If so, that would imply 9.8% growth from last year’s tally of $378.07 million.
For fiscal 2025, analysts believe sales could reach $435.6 million. And the high-side estimate calls for3 $449.1 million.
Notably, LINC carries a unanimous strong buy view. Further, the average price target hits $13.13, implying an upside potential of 35%.
VAALCO Energy (EGY)
An independent energy company, VAALCO Energy (NYSE:EGY) engages in the acquisition, exploration, development, and production of crude oil, natural gas, and natural gas liquids in Gabon, Egypt, Equatorial Guinea, and Canada. Per its corporate profile, Vaalco holds a 58.8% interest in the Etame production-sharing contract related to the Etame Marin block. This project covers an area of approximately 46,200 gross acres.
EGY makes the rounds for value stocks under $20 thanks to its PEG ratio of 0.28. That sits well lower than the sector median 0.99X. Also, EGY trades at a forward earnings multiple of 7.86X, below the oil and gas sector’s median value of 9.68X.
In fairness, Vaalco featured a very spotty earnings record in fiscal 2023. However, the company turned things around in Q4, posting EPS of 37 cents. The expectation called for only 12 cents.
Despite concerns about the hydrocarbon business looking ahead, analysts rate shares a unanimous strong buy. The forward-12-month price target stands at $8.54, implying over 39% upside potential.
Galiano Gold (GAU)
A precious metals miner, Galiano Gold (NYSEAMERICAN:GAU) engages in the exploration and evaluation of gold properties in Canada. However, according to its corporate profile, Galiano’s flagship asset is the Asanko Gold Mine, which covers an area of approximately 21,000 hectares. It’s located in Ghana, West Africa. Since the start of the year, GAU stock gained more than 21% of its equity value.
Galiano makes for an intriguing case for value stocks under $20 due to its trailing-year earnings multiple of 4.26X. That’s lower than nearly 87% of players in the metals and mining industry, which features a median ratio of 16.31. In addition, GAU trades at an EV-to-EBITDA ratio of 3.78, beneath the sector median 8.83X.
For full disclosure, the company’s earnings performance were all over the place last year. However, for the current fiscal year, experts believe that sales will hit $331.65 million. If so, that would be 29.3% up from last year’s tally of $256.54 million. Also, EPS should be 22 cents, above 2023’s print of 12 cents.
Analysts peg GAU as a moderate buy with a $1.78 average price target. That implies over 60% growth potential.
TransAlta (TAC)
Situated in the utilities sector, TransAlta (NYSE:TAC) ranks among independent power producers. Per its public profile, the company engages in the development, production and sale of electric energy. It operates through the following segments: Hydro, Wind and Solar, Gas, Energy Transition and Energy Marketing. Since the start of the year, TAC lost almost 23% of market value.
Naturally, this red ink makes TransAlta one of the riskiest ideas for value stocks under $20. However, for speculators, the metrics may be appealing. For example, shares trade at a PEG ratio of only 0.33. In contrast, the utilities subsegment carries a median ratio of 1.51X. Also, TAC trades at a trailing-year earnings multiple of 3.74X, below the sector median 15.55X.
Now, one of the forward-looking concerns is the erosion of projected erosion of growth. Analysts believe that sales will reach only $1.99 billion. That would mean a 19.6% decline from last year’s print of $2.48 billion.
Still, experts also believe that given the new realities, TAC remains a unanimous strong buy. The average price target stands at $11.19, implying over 77% growth potential.
Voyager Therapeutics (VYGR)
A biotechnology firm, Voyager Therapeutics (NASDAQ:VYGR) focuses on the treatment of gene therapy and neurology diseases. According to its corporate profile, the company’s lead clinical candidate is VY-TAU01, an anti-tau antibody program for the treatment of Alzheimer’s disease. Granted, this therapeutic focus can be brutal. Still, if Voyager hits it out of the park clinically, VYGR could easily skyrocket.
That’s what investors are anticipating, with shares up 15% since the January opener. Over the past 52 weeks, it gained 33%. Enticingly, shares trade at only 3.42X trailing-year earnings and 1.84X trailing-year revenue. Respectively, the median stats for the industry stand at 29.53X and 9.52X. So, what’s with the cheap multiple?
In terms of projections, 2024 could be a loss while revenue may only land at $39.82 million. That’s well off the pace of last year’s EPS of $2.97 and sales of $250 million. However, the wager comes down to the science.
Analysts peg VYGR as a unanimous strong buy, projecting the price per share to hit $16.33. If so, we’re talking about 76% upside.
iQIYI (IQ)
Based in China, iQIYI (NASDAQ:IQ), together with its subsidiaries, provides online entertainment video services. According to its public profile, the company offers various products and services, including online video, online games, online literature, animations and other products. Since the beginning of the year, IQ stock lost more than 13% of its equity value. Over the past year, it’s down 40%.
Obviously, IQ represents one of the riskiest ideas for value stocks under $20. With big questions surrounding the underlying Chinese economy, the matter heightens the risk profile. Right now, shares trade at a forward earnings multiple of 2.19X. That’s lower than the sector median value of 13.1X. Also, the PEG ratio sits at 0.9X, below the median value of 1.28X.
In Q2 and Q3, Iqiyi posted 5 cents and 7 cents for EPS, respectively. These metrics met the expected targets. However, Q4 began picking up the pace, with an EPS of 7 cents against a target of 6 cents. For 2024, per-share profits could jump to 41 cents, above last year’s print of 28 cents.
Finally, analysts rate shares a consensus strong buy with a $6.43 price target, implying almost 61% upside.
On the date of publication, Josh Enomoto 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.
