It is well known that low-priced stocks generate the biggest returns in the market. Stocks under $5 tend to be smaller companies, but as we have seen during this last recession, plenty of big companies are trading under $5 per share, as well.
Whatever your preference, large or small, you can do well riding the momentum of inexpensive stocks. It is far easier for a sub-$5 stock to double in value than it is for a $500 stock to do the same. All that is needed is a reasonable valuation and strong earnings growth.
The larger extent to which companies trading under $5 serve monster markets, the better. It is that potential that is likely to be bid up. Prove that potential with demonstrated earnings growth, and away you go.
Here are five of my favorite stocks trading for under $5 per share.