In the markets, sometimes the words “bargain” or “cheap” can be confusing.
A bargain stock can sell for $300 a share; an expensive stock could sell for $8 a share.
These seven stocks — Sequenom, Inc. (NASDAQ:SQNM), Array Biopharma Inc (NASDAQ:ARRY), Emcore Corporation (NASDAQ:EMKR), Advanced Semiconductor Engineering (ADR) (NYSE:ASX), Vonage Holdings Corp. (NYSE:VG), AU Optronics Corp (ADR) (NYSE:AUO) and Orexigen Therapeutics, Inc. (NASDAQ:OREX) — are both bargains (great values) and cheap (they’re all priced under $10 a share).
Each one has fashioned a special niche in a particular sector that has plenty of room for growth. These are more than single-stock stories and instead based on secular market trends, which means not only do these stocks have opportunities to grow their businesses, but they are also potential takeover candidates.
7 Bargain Stocks to Buy: Sequenom, Inc. (SQNM)
Share Price: $4.55
Sequenom, Inc. (NASDAQ:SQNM) is completely focused on sequencing the human genome.
That may not sound like a money-making enterprise, but what it really means is Sequenom develops test for genetic markers that have been determined to be precursors to cancer or other diseases.
These tests are especially important in the context of prenatal testing for genetic problems and testing adults for hereditary genetic abnormalities.
Also, as SQNM uncovers more information on the mysteries of DNA sequencing, it can build out testing and diagnostic equipment to look for specific markers.
This may seem like pretty crazy stuff, but it’s becoming more common every year; and SQNM is the genetic-sequencing leader.
7 Bargain Stocks to Buy: Array Biopharma Inc (ARRY)
Share Price: $7.34
Array Biopharma Inc (NASDAQ:ARRY) is a biopharmaceutical company focusing on cancer drugs. Right now, Array Biopharma has six Phase III trials underway with three of its potential drugs.
While ARRY has a $1 billion market cap, it’s in the middle of the biotech ‘Valley of Death,’ where it’s got money to fund the studies, but if the trials don’t go well, ARRY ends up in the middle of the valley dying of thirst when funding dries up.
That’s the risk, but Array Biopharma didn’t get to the size it is now by luck. ARRY has very promising drugs and has built six solid trials.
So, the odds favor a good outcome in the trials and a lot of opportunity for ARRY. Plus, if the trials work out, ARRY is a prime candidate for a takeover at a huge premium from a big pharma.
7 Bargain Stocks to Buy: Emcore Corporation (EMKR)
Share Price: $5.50
Emcore Corporation (NASDAQ:EMKR) is in two of the most dynamic sectors in the world today — telecommunications and renewable energy.
Emcore operates two divisions: fiber 0ptics and photovoltaics. But EMKR isn’t selling fiber optic cable and solar panels. Emcore makes and sells the equipment that goes into making these technologies work.
Emcore is like high tech hardware store for telecom and solar builders, installers and manufacturers, and it goes without saying that there’s plenty of room for growth in both sectors.
Companies are replacing copper cable as quickly and cost effectively as possible to increase bandwidth and data speeds to businesses and consumers. Both consumer and commercial solar installations are growing by double digits year after year.
EMKR is a key player that is showing its value.
7 Bargain Stocks to Buy: Advanced Semiconductor Engineering (ADR) (ASX)
Share Price: $7.38
Advanced Semiconductor Engineering (ADR) (NYSE:ASX) is a world leader in the more arcane — yet crucial — aspects of chip technology: testing and packaging.
Yes, those aspects seem trivial, but given the reliability we expect from our devices (practically 100% reliability at all times), making sure they’re all working properly before they’re installed is pretty important.
And once you’ve made sure they all work properly, you need to be able to ship them, so they don’t get damaged in the process. Given how powerful chips have become and how small, shipping them around the world in massive quantities is no mean feat.
ASX will have plenty of work moving forward.
7 Bargain Stocks to Buy: Vonage Holdings Corp. (VG)
Share Price: $4.88
Vonage Holdings Corp. (NYSE:VG) is the only consumer-facing company on our list today, but VG’s technology is 100% geek.
Vonage is the pioneer of voice over internet protocol (VOIP) communications, which, in simpler terms, means being able to use the internet to make phone calls.
This was a highly disruptive sector when it launched, but Vonage’s value was diminished when other VOIP players, which major companies owned, began to compete against VG. While Microsoft Corporation (NASDAQ:MSFT) had more going than Skype, VG only had its VOIP business. Verizon Communications Inc. (NYSE:VZ) sued VG just after it went public, in an attempt to kill the initial public offering and Vonage.
But business is better these days, and VG has not only survived but grown into a real player. Vonage remains a solid stock and interesting takeover play.
7 Bargain Stocks to Buy: AU Optronics Corp (ADR) (AUO)
Share Price: $5.28
We’re increasingly becoming a screen-driven people.
So, what company is better to invest in that AU Optronics Corp (ADR) (NYSE:AUO), one of the world’s leading makers of flat screens, curved screens and handheld screens.
Like makers of mobile phones, each major screen company doesn’t necessarily build its own HDTVs. It ships out the specs to a manufacturer, who makes the HDTVs to its clients’ specifications. AUO is the manufacturer of the world’s screens for leading tech brands.
From huge HDTVs to small smart phones, there’s a good chance there’s at least one or two devices in your house that was built by AUO, and there’s an even better chance there will be more AUO products in your house in coming years.
7 Bargain Stocks to Buy: Orexigen Therapeutics, Inc. (OREX)
Share Price: $7.55
Juan Ponce de León became a legend for his quest for The Fountain of Youth. The modern day corollary to that Quixotic pursuit is the quest for a “fat pill” — a pill that can help prevent or remedy obesity.
Orexigen Therapeutics, Inc. (NASDAQ:OREX) is very close to making that pill a reality. OREX’s two drugs, Contrave and Mysimba, are both available by prescription.
Mysimba is only available in Europe at this point, but Contrave is approved in the U.S. for specific levels of obesity. The real money will come in when Contrave comes off prescription and is available over the counter.
Given the need, especially in the U.S., there is a very good chance the Food and Drug Administration will move quickly getting Orexigen products to as many people as possible, as soon as possible.
Once the long-term data on patients starts rolling in, OREX may well be a takeover target or have huge upside growth potential on its own.
Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.