One of the best things about investing in financial markets is that there is always a deal to be found. New opportunities present themselves every single day, especially if you are buying and selling stocks. With that said, investors need to put in the work that is required to find companies that are undervalued. This can be even harder if you are an investor hunting for bargain-priced stocks at under $50 a share. The adage “you get what you pay for” can be true in the stock market, but that doesn’t mean you should avoid buying lower-priced companies entirely.
Here are 3 stocks currently trading below $50 per share that are worth looking into at this time. Each one of these companies offers investors something different and could deliver long-term earnings growth, so keep reading below to learn a little more about each one of them.
We will start this list off with a more conservative stock pick that should interest value investors. NRG Energy is a company that sells energy, services, and products to residential, small business, and industrial customers all over the United States. The company generates the majority of its revenue by providing energy to retail consumers, but NRG also has a diversified power generation portfolio with approximately 23,000 MW of fossil fuel, nuclear, and renewable generation capacity at 32 different plants.
It’s a stock that was hit hard during the pandemic, particularly since commercial and industrial businesses slowed down. That means it’s trading at very reasonable levels at this time, with a very attractive forward P/E of 7.71. The company’s recent acquisition of Direct Energy should provide some 2021 earnings growth, as the transaction will add over 3 million new customers across 50 states. With a 3.55% dividend yield and strong free cash flows, investors that are looking for a utility stock with upside should be interested in NRG Energy.
Palantir Technologies (NYSE:PLTR)
Next on our list is a more speculative investment that could generate strong returns in 2021. Palantir Technologies is a software company that specializes in big data analytics, which is an area that has tons of growth potential over the next few years. Palantir operates commercial and government business segments, with the majority of the company’s revenue coming from government contracts. This tells us that that Palantir is attracting clients in high places. The software that the company has created helps data analysts do their jobs better by bringing the data to life for human-driven analysis.
Palantir stock has been incredibly strong since its debut in September and is up over 180% year-to-date. The company just announced that the U.S. Army’s Program Executive Office for Enterprise Information Systems is moving forward with a second year of the Army Vantage program for $113.8 million. The fact that major government entities are using Palantir’s software and renewing their contracts tells us that the company is doing something right. Palantir is forecasting 2021 year-over-year revenue growth of over 30% and saw Q3 revenue rise by 52% year-over-year to $289.4 million.
SunPower Corporation (NASDAQ:SPWR)
The last stock on our list is poised to benefit greatly from a Joe Biden presidency and the continued focus on renewable energy sources. SunPower Corporation is a company that provides solar power components like panels and system components to residential, commercial, and utility customers all over the world. Thanks to SunPower’s proprietary technologies, it can claim that it has the highest conversion efficiency of sunlight into electricity available for the mass market. The company also offers storage products that could play a key role in getting more people to consider solar power.
Joe Biden has already proposed a plan to use $2 trillion in subsidies to fund renewable projects, which tells us that the clean energy industry has a ton of growth potential going forward. Sales for the company should also bounce back in 2021, especially with the new home solar mandate in the California region. With an improving balance sheet and plenty of market tailwinds working in its favor, SunPower is a nice option for investors looking for exposure to renewables at under $50 a share.
Before you consider NRG Energy, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and NRG Energy wasn't on the list.
While NRG Energy currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
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