Cheap stocks are plentiful. Cheap stocks that also offer real long-term growth potential are tougher to find. When you set a price of $20 or less and you expect to see performance, there’s no sector where you’re more likely to find the stocks to buy. They could be anywhere, so you need to cast a wide net.
This list of seven top stocks includes companies in the technology sector, construction, real estate development and mining. There’s even a department store chain in the mix — something that would have been unheard of in 2020, with retailers collapsing from the effects of the pandemic.
In fact, the ongoing recovery from the lockdowns and the worst of the pandemic plays a large role in the recommendation of some of these stocks.
- Cemex (NYSE:CX)
- Himax Technologies, Inc. (NASDAQ:HIMX)
- Macy’s Inc (NYSE:M)
- Newmark Group Inc (NASDAQ:NMRK)
- United Microelectronics Corp (NYSE:UMC)
- Vedanta Ltd (NYSE:VEDL)
- Wipro Limited (NYSE:WIT)
Each of these stocks has several elements in common. Each is performing strongly and on a growth trajectory. In addition, each is highly rated in Portfolio Grader. And, of course, each currently trades for $20 or less.
Stocks to Buy: Cemex (CX)
Cemex is a multinational company based in Mexico that is focused on building materials. Especially concrete and aggregates. The company’s global footprint in terms of ready-mix cement plants, aggregate quarries and cement grinding plants numbers in the thousands of locations.
In the U.S. alone, Cemex operates 10 cement and grinding plants, 335 ready-mix plants, 60 aggregate quarries, 35 distribution centers and 11 marine terminals. The company just bought four more plants in Texas, looking to take advantage of its rising U.S. sales.
Do you know what is going to really goose that U.S. business? The trillion dollar Infrastructure Bill that was just passed by the Senate. A big part of that spending is earmarked for replacing crumbling highways and bridges — structures that require a lot of concrete. Over the past year, CX stock (which currently trades for $7.89) have delivered a return of 128%. With the U.S. and other countries looking at infrastructure spending to kickstart their economies, the demand for concrete is going nowhere but up. The same is likely to hold true for CX stock.
At the time of publication, CX stock earned an “A” rating in Portfolio Grader.
Taiwan’s Himax is a fabless semiconductor company that specializes in display drivers. These are chips that are used in everything from TVs and laptops, to smartphones and the smart touchscreen displays that are now found in virtually every new car and truck. In other words, these chips are virtually everywhere these days.
That means the company’s chips are in high demand, and that demand continues to grow. In its latest quarter, Himax reported that revenue, gross margins and earnings-per-share all hit new record highs. That’s despite the fact that the company continued to struggle with shortages across all its business segments. HIMX stock is currently priced at $12.71 and has posted gains of 213% over the past 12 months.
The current Portfolio Grader rating for HIMX stock is “A.”
Stocks to Buy: Macy’s (M)
Macy’s could easily have become one of the pandemic’s retail victims. Several of the country’s best-known department store chains filed for bankruptcy in 2020. Macy’s — which also owns Bloomingdale’s in addition to the Bluemercury skincare and spa chain — was forced to permanently close 30 stores in 2020. In January, it announced plans to shut down another 45 underperforming locations.
However, with a leaner operation (that still includes 512 locations), a thriving e-commerce operation (it brought in 37% of the company’s sales in Q1) and shoppers beginning to return to stores, the Macy’s recovery is well under way.
With shares currently just sneaking under that $20 ceiling at $18.50, M stock is a great choice if you want an investment that will take advantage of the pandemic recovery.
One of the reasons Macy’s is among the top stocks to buy in August is the Portfolio Grader “A” rating for M stock.
Newmark Group (NMRK)
New York’s Newmark Group is another bet on the post-pandemic recovery, especially in cities and urban areas. The company is focused on the commercial real estate market including development, management services and mortgage brokerage. At this time last year, Newmark was feeling the pandemic’s effect and it wasn’t pretty.
The company tried to re-assure investors in its Q2 earnings report: “Newmark is well-positioned to benefit from periods of market disruption and its recovery due to the strength of our platform and the significant amount of talented professionals that have joined the Company over the past several years. Our professionals’ creativity, inventiveness, and drive provide us with a competitive advantage as economic activity accelerates.”
A year later, Newmark reported record revenue and earnings, and also upped its 2021 full-year guidance. Currently trading at $12.79, NMRK stock is up 197% over the past year.
NMRK stock currently earns an “A” rating in Portfolio Grader.
Stocks to Buy: United Microelectronics (UMC)
One of the biggest stories of 2021 has been the global shortage of semiconductors. The tiny chips are found in a huge range of products. That was already causing a demand increase. That’s been spiking as consumers open up their wallets. Add in the reality that there are very few foundries globally (one of which was damaged in a fire in Japan last year) and new plants cost billions of dollars to build. It’s estimated that the auto industry alone is looking at a $60 billion hit this year with car production lines are shutting down because of a lack of chips.
That brings us to United Microelectronics. It’s not the biggest player, but UMC is one of those few companies that operates chip foundries. It manufactures semiconductors under contract for other companies. It’s a semiconductor stock, and that means growth. Over the past 12 months UMC stock has delivered a return of 160.75% and that demand for its chips is unlikely to level off any time soon. At $10.42, UMC is among the most affordable stocks to buy if you want to make the most of the chip shortage.
At the time of publication, the Portfolio Grader rating for UMC stock was “A.”
Vedanta Resources (VEDL)
Vedanta Resources is a natural resources extraction and processing company. It deals with a wide range of minerals including iron ore, gold, silver, copper and aluminum, as well as oil and natural gas.
I want to look at aluminum in particular at the moment. Recently available in surplus, it’s on fire this year. Infrastructure projects and an effort to cut emissions by making products lighter is driving global demand for aluminum to new heights. At the start of August, prices had increased 30% so far in 2021 and were nearing a decade high.
Vedanta Resources shares are priced at $15.44, but they were worth less than half that only a year ago. At this point, VEDL stock is up 129% over the past 12 months.
VEDL stock was rated “A” in Portfolio Grader at the time of publication.
Stocks to Buy: Wipro (WIT)
The final entry on this list of stocks to buy under $20 in August is Wipro. Just $8.98 will buy you a share in this India-based, multinational IT company.
Despite many companies still having staff working remotely, Wipro’s business is thriving. The quarter ending June 2021 was its best ever. In addition to year-over-year EPS growth of 41%, Wipro reported signing a number of big U.S. clients, ranging from the telecommunications sector, to oil field services, and a health insurance company.
Wipro isn’t sitting still, recently announcing a $1 billion investment in its cloud computing business. WIT stock isn’t sitting still either. It’s up 110% over the past 12 months.
The “A” rating in Portfolio Grader for WIT stock is another reason why this company made the list of top stocks to buy for under $20 in August.
On the date of publication, Louis Navellier had a long position in CX, HIMX, UMC, and VEDL. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article. InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
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