Speculators love toiling away in low-priced stocks, but there is an opportunity for more dedicated investors to cash in if they’re willing to do the research. Most stocks trading below $5 are there for a reason, and they’ll probably stay that way. However, sometimes a stock breaks out of Mr. Market’s doghouse.
Qutoutiao (NASDAQ:QTT), Trivago (NASDAQ:TRVG), and Fitbit (NYSE:FIT)are some of the out-of-favor investments that could break the $5 ceiling this year. Let’s see why these five low-priced stocks could bounce back in the coming months.
Qutoutiao — $4.47
The Chinese mobile content aggregator has been a wild ride for investors since going public at $7 last summer. The shares would go on to more than double by the springtime of this year, but a secondary offering in early April nipped the rally short. The stock has shed more than of its value since the secondary offering priced at $10 three months ago.
The good news for investors is that Qutoutiao is still one of the fastest-growing publicly traded companies. Revenue soared 373% in its latest quarter. Qutoutiao’s mobile platform leans on artificial intelligence to serve up customized feeds consisting of articles and short video clips. The stickiness is undeniable, as its 37.5 million daily active users spend an average of more than an hour a day on the platform.
Qutoutiao announced a $50 million share buyback authorization in late May. It may seem like an odd move for a company that had just raised $31 million in a secondary offering nearly two months earlier, but the move makes sense with the stock having fallen so hard in that time. Qutoutiao is in the market’s doghouse right now, but scintillating growth has a funny way of changing that condition.
Trivago — $4.11
The state of Trivago’s business depends on which side of the income statement you want to focus on when sizing up the online hotel portal. Revenue has declined for five consecutive quarters, including a nearly 20% plunge in its latest report. The news is thankfully kinder on the bottom line, as Trivago has now rattled off three straight quarterly profits.
The top-line slide is by design. Trivago got burned when it…
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