Contributor, Benzinga
Updated: December 7, 2022

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Vasta Platform (XNAS:VSTA)

Vasta Platform Ltd operates as an education company in Brazil, engaged in providing end-to-end educational and digital solutions that cater to all needs of private schools operating in the K-12 educational segment. Its business segments are Content and EdTech Platform, and Digital Platform. The Content and EdTech platform derives its results from educational content solutions through digital and printed content, including textbooks, learning systems and other complementary educational services. The Digital Platform enables private schools to aggregate multiple learning strategies and helps them to focus on education, through the Business’ physical and digital e-commerce platform and other digital services.

Vasta Platform
(NASDAQ:VSTA)
$3.88
-0.14[-3.48%]
Last update: 12:52PM (Delayed 15-Minutes)
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Day Range3.84 - 4.0252 Wk Range- - 6.53Open / Close3.96 / -Float / Outstanding- / 82.6M
Vol / Avg.7.3K / 16.5KMkt Cap320.5MP/E-50d Avg. Price4.9
Div / Yield-Payout Ratio-Total Float-EPS-

Mesoblast (XNAS:MESO)

Mesoblast Ltd is a clinical-stage biotechnology company. It develops and commercializes innovative allogeneic cellular medicines to treat complex diseases resistant to the conventional standard of care. Its portfolio of Phase 3 product candidates comprises remestemcel-L for the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD), and for moderate to severe acute respiratory distress syndrome (ARDS) and others.

Mesoblast
(NASDAQ:MESO)
$3.15
-0.25[-7.35%]
Last update: 12:58PM (Delayed 15-Minutes)
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Day Range3.09 - 3.3652 Wk Range2.14 - 6.77Open / Close3.36 / -Float / Outstanding- / 147.3M
Vol / Avg.58K / 77.4KMkt Cap464MP/E-50d Avg. Price3.11
Div / Yield-Payout Ratio-Total Float-EPS-

Tempo Automation Holdings (XNAS:TMPO)

Tempo Automation Holdings Inc is a software-accelerated electronics manufacturer, transforming the way top companies innovate and bring new products to market. Tempo’s unique automated manufacturing platform optimizes the complex process of printed circuit board manufacturing to deliver unmatched quality, speed and agility. The platform’s all-digital process automation, data-driven intelligence, and connected smart factory create a distinctive competitive advantage for customers to deliver tomorrow’s products today.

Tempo Automation Holdings
(NASDAQ:TMPO)
$2.88
-0.46[-13.77%]
Last update: 1:01PM (Delayed 15-Minutes)
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Day Range2.69 - 3.4252 Wk Range3.22 - 15.15Open / Close3.42 / -Float / Outstanding- / 26.4M
Vol / Avg.129.1K / 172.5KMkt Cap76MP/E-50d Avg. Price5.25
Div / Yield-Payout Ratio-Total Float-EPS-

Telos (XNAS:TLS)

Telos Corp offers technologically advanced, software-based security solutions that empower and protect the world’s security-conscious organizations against rapidly evolving, sophisticated and pervasive threats. Its portfolio of security products, services and expertise empower customers with capabilities to reach new markets, serve their stakeholders more effectively, and successfully defend the nation or their enterprise. The company’s customer base consists of the U.S. federal government, large commercial businesses, state and local governments, as well as international customers. It derives a substantial portion of revenues from contracts and subcontracts with the U.S. Government.
Telos
(NASDAQ:TLS)
$4.265
0.045[1.07%]
Last update: 1:04PM (Delayed 15-Minutes)
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Day Range4.15 - 4.3652 Wk Range3.35 - 17.28Open / Close4.18 / -Float / Outstanding- / 67.2M
Vol / Avg.259.8K / 903.9KMkt Cap286.7MP/E-50d Avg. Price7.47
Div / Yield-Payout Ratio-Total Float-EPS-

SNDL (XNAS:SNDL)

SNDL Inc, formerly Sundial Growers Inc is engaged in producing and marketing cannabis for the adult-use market. Some of its products are Lemon Riot, Daydream, Zen Berry, Twilight, Tropical Bliss, Pillow Talk, Citrus Punch, and others. The company’s primary focus is on producing and distributing inhalable products and brands (flower, pre-rolls, and vapes). some of its brands include Sundial, Top Leaf, Palmetto, and Grasslands. Its three reportable segments: are cannabis operations, retail operations and investments.

SNDL
(NASDAQ:SNDL)
$2.735
-0.09[-3.19%]
Last update: 1:05PM (Delayed 15-Minutes)
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Day Range2.66 - 2.852 Wk Range0.29 - 6.9Open / Close2.79 / -Float / Outstanding- / 236M
Vol / Avg.1.7M / 4.1MMkt Cap645.5MP/E-50d Avg. Price2.41
Div / Yield-Payout Ratio-Total Float-EPS-

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Searching for quality stocks under $5 is a lot like bargain hunting. Low prices allow you to buy these stocks in large quantities without stretching your wallet. The payoffs can be huge, but so can the volatility. This is why the best stocks to buy now cheap must be monitored carefully. This is not a “set it and forget it” scheme. Do some research and start with the stocks listed below.

Overview: Stocks Under $5

Stocks that trade under $5 are considered cheap stocks. But unlike stocks under $10 or stocks under $20, stocks under $5 are in a separate category. The Securities and Exchange Commission (SEC) considers stocks that trade under $5 to be penny stocks. Yes, these are often the best cheap stock to buy even if they’re called “penny stocks”. When you do your research, a term like penny stock shouldn’t scare you.

For example, Costco (NASDAQ: COST) is a discount retailer that hosts customers in large warehouses. Even so, it’s stock regularly trades for several hundred dollars per share and the company is one of the largest retailers in the world. While this is an extreme example, it shows that terminology only paints a small part of the picture.

Let’s say you invest $300 for 100 shares of a stock trading at $3. If that stock price goes up by only $3, you will have made 100% in profit, or $300. Huge payoffs for little upfront capital is what makes cheap stocks an attractive investment. 

However, you must understand that cheap stocks are very close to 0 or being delisted. This does not mean that all cheap stocks will lose value, but a stock that isn’t all that expensive could easily plummet overnight, leaving with tough decisions to make.

A strategy for spotting potential in stocks under $5 is to look out for undervalued companies. Companies that have suffered a crisis might see stock prices dip into the low single digits. Executive mismanagement, high debt, pricing pressures and increased competition are some of the factors that spook investors and send a company’s stock sinking. 

But the company might be able to turn things around. Management can change, debt can be restructured or the market could shift in the company’s favor. Everyone loves a comeback — especially if you’ve scooped up that stock for a bargain.

Another way to spot a potential winner is by looking at companies that have major growth potential. A stock could trade under $5 because the company is small. But that small company could also be rapidly growing.

Take a look at how the market is performing. These strategies are just the beginning. Always do your due diligence when investing in stocks under $5. Finding cheap stocks to buy right now doesn’t mean you should buy them all. Pace yourself to see the best results.

Best Online Brokers for Stocks Under $5

The right online broker can help you execute your investment strategy and make trading cheap stocks seamless. Take a look at some of Benzinga’s favorites. You have found stocks to buy now cheap, but you need a partner that makes the process simple.

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Features to Look for in Stocks Under $5 

Here are some things you may want to consider as you gather stocks under $5 into your basket:

  • Earnings per share: A great way to get a sense of a company’s profitability is by looking at its earnings per share (EPS). You can find a company’s EPS by subtracting the preferred dividends from net income and then dividing the difference by outstanding stockholder shares. If you spot a stock with EPS that has been growing, it can signal growth potential. 
  • Trading volume: A stock’s trading volume will tell you how many shares are traded during the day. If the trading volume isn’t high enough, you may not be able to sell your position. Stocks that have a trading volume of at least 1 million tend to be safer. Keeping an eye on the trading volume will also help you spot stocks that may be on the uptick. 
  • Management: A management team that is set on turning the company around can be the reason a stock under $5 enjoys a boost. A company’s focus on capitalizing on a growing market is another sign of potential. Look into the company’s strategic business plan to understand the mindset of management.

Weigh Risk for Stocks Under $5

When you find a few cheap stocks to buy right now, they carry both growth potential and their fair share of risks. Even the best stocks to buy under $5 are notorious for major upswings and selloffs. Your risk for loss is also higher if the company hits a difficult roadblock. It’s not unheard of for companies with shares trading under $5 to go under and leave investors with nothing. 

Avoid putting all your money into these stocks and diversify with safer assets like blue-chip stocks or bonds. The best cheap stocks to buy can be a valuable addition to your investment portfolio with your due diligence and diversification. Stocks to buy now cheap can become a lovely addition to your portfolio, so long as you return to Benzinga often to research each new security.