5 Cheap Stocks That Just Got a Little Cheaper

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The Silver Lining to the Sell-Off

Sale TagsFollowing news that Japan had raised the alert level on its nuclear crisis and a less-than-stellar start to the earnings season with Alcoa Inc. (NYSE: AA) reporting disappointing sales, the Dow Jones Industrial Average fell more than 100 points on Tuesday. Falling oil prices also contributed to the market’s drop, dragging down energy stocks.

The bright side of a day like today, though, is that it gives investors the chance to buy stocks for a better price. The stock picks on this list were already trading at attractive prices, but it never hurts when a cheap stock gets even cheaper.

Metalico (MEA)

Metalico (AMEX: MEA) Hilary Kramer, Editor, Breakout Stocks Under $5

Metalico (AMEX: MEA) recycles scrap metal and makes lead products used in everything from nuclear energy to stained glass windows to balance systems in planes. Demand for ferrous scrap metal continues to grow steadily driven by increasing electric arc furnace production capacity, and the company is also benefiting from the higher prices for ferrous scrap, which have increased dramatically. The scrap industry remains poised for further consolidation, and Metalico is right in the thick of it.

The stock has caught some momentum recently, following a surprise dip after reporting better-than-expected fourth-quarter earnings in early March. I believe first-quarter earnings will also surprise to the upside given continued firmness in scrap metal prices and increased steel production. Shares fell almost 4% today, giving investors a nice opportunity to pick the stock up around $5.70 for a target of $10.

Powerwave Technologies (PWAV)

Powerwave Technologies (NASDAQ: PWAV) Nancy Zambell, Editor, Buried Treasures Under $10

Powerwave Technologies (NASDAQ: PWAV) operates in the wireless communication arena, targeting both enterprise and commercial customers around the world for its technologically advanced end-to-end wireless infrastructure solutions. The company’s indoor/outdoor wireless coverage systems offer better signal quality and reduced network congestion, giving users faster access and longer battery life and support mission critical communications for government, law enforcement and public safety agencies worldwide.

PWAW is making money, attracting positive analyst attention in the form of upgrades, and its estimates are trending up. Currently trading just above $4 after a near 5% pullback today, I think shares could easily go to $7.50.

Tii Network Technologies (TIII)

Tii Network Technologies (NASDAQ: TIII)Louis Navellier, Editor, Emerging Growth

I see Tii Network Technologies (NASDAQ: TIII) as being one of the major beneficiaries of the 4G revolution. The company helps protect expensive telecom equipment with its overvoltage surge protection devices. This is especially useful during lightning strikes and power surges.

Naturally, large telecom carriers like Verizon Communications (NYSE: VZ) are big customers, accounting for 34% of sales. With Verizon and other cellphone providers upgrading to 4G, the company’s sales should remain very strong. After a 3.5% pullback today, shares are currently trading for about $2.75.

LJ International (JADE)

LJ International, Inc. (NASDAQ: JADE)Hilary Kramer, Editor, Breakout Stocks Under $5

Jewelry retailer LJ International (NASDAQ: JADE) is a direct play on the rapid growth and increased spending of China’s consumers. As China’s middle class earns more and spends more, it is also adopting Western spending traditions — such as buying diamond engagement rings and gold jewelry for anniversaries and special occasions.

The company’s strong fourth-quarter earnings announcement at the end of March was thanks in part to recent success of its ENZO jewelry. JADE is adamant about expanding the chain with an aggressive but confident strategy that should continue to boost revenues. Shares have been cheap, selling at only about 9 times 2011 EPS estimates, and today’s sell-off put them at about $3.80. My target is $9.

First Busey Corp. (BUSE)

First Busey Corp. (NASDAQ: BUSE)Nancy Zambell, Editor, Buried Treasures Under $10

I think small regional banks are set to make a comeback, and in this space I like Illinois-based First Busey Corp. (NASDAQ: BUSE). The bank has had its share of problems, as Illinois was one of the largest hubs of banking problems in the nation during the financial fallout. And BUSE borrowed $100 million TARP funds, which it hasn’t yet paid back in total, but it is making great progress toward that goal.

The company beat estimates in the last four fiscal quarters, and institutions are ramping up their ownership. Additionally, the stock appears to be breaking out technically, and pays a nice little dividend of almost 3%. As the regional baking sector recovers, I think BUSE will be a leader. Shares fell slightly today to around $5.37, and my initial target for the stock is $9.


Article printed from InvestorPlace Media, https://investorplace.com/2011/04/cheap-stocks-to-buy-mea-jade-tiii-pwav-buse/.

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