Three Stocks Under $10 That May Skyrocket

TH Stock Analysis

Let’s be brutally honest: cheap stocks under $10 falls under a category that starts with the letter “C” — and no, I’m not referring to “commendable” or “celebrated.” Quite the opposite, actually. However, under the right circumstances, they can offer serious bang for the buck.

Generally speaking, you want to be ultra-prudent regarding the acquisition of cheap stocks. Think of this asset class as running a football play out of the shotgun formation. The defense knows that more often than not, you’re attempting to execute a passing play. It will be ready, meaning that the chances of successful conversion are low — wildly low, in arguably most cases.

That said, there are some choice reasons why an investor may consider cheap stocks. Primarily, the motivating catalyst centers on asymmetric upside potential. Low-priced securities offer the potential to deliver multi-bagger returns with relatively small price movements. Real quickly, a stock rising from $5 to $10 represents a 100% return. On the other hand, a blue chip moving from $500 to $1,000 will consume more capital and (probably) more time.

Another element that may favor cheap stocks under $10 is the concept of the institutional blind spot. Many hedge funds and mutual funds have policies — whether written or unwritten — against buying securities that fall below critical price thresholds. Therefore, certain enterprises could truly be undervalued as opposed to just being cheap.

Finally, there’s always the possibility that lightweight securities could be picked up for takeovers or acquisitions. Such high-level strategies could easily represent a bonanza for investors entering before the wave. With that in mind, below are compelling cheap stocks under $10 to consider.

Target Hospitality (TH)

TH Stock Analysis

To follow in the vein of brutal honesty, Target Hospitality (NASDAQ:TH) probably won’t rank highly among investors seeking cheap stocks. The naming probably doesn’t help, with possibly most folks confusing TH with the similarly titled big-box retailer. Nevertheless, Target Hospitality is incredibly relevant thanks to the second Trump administration.

Because Trump 2.0 is such an outspoken supporter of fossil fuels, this fact should bolster Target’s core business of providing modular accommodations and hospitality services, primarily supporting the U.S. government and natural resource sectors. Since the services are tied closely to the energy industry (particularly oil and gas), TH stock could ride the coattails of Trump’s vision for America, which includes gas stations, not necessarily electric-vehicle charging posts.

To be fair, part of the reason why TH ranks among the cheap stocks under $10 is that prior to Trump 2.0, the prospects for continued fossil-fuel development looked dim. Notably, in the third calendar quarter last year, TH stock traded for a multi-year low in terms of the price-to-sales ratio at 1.68X trailing-year revenue.

Right now, the metric has moved up to 2.27X. However, this ratio could still represent a tremendous deal long term thanks to the radical paradigm shift that Trump imparted. That’s a huge positive that could send TH stock marching higher.

Palladyne AI (PDYN)

PYDN Stock Analysis

Speculative doesn’t even begin to describe Palladyne AI (NASDAQ:PDYN). Back a few short months ago in November, PDYN stock could be had for less than two bucks. Now, it stands on the cusp of breaking above $8. That’s not exactly comforting because at any moment, the rug could be pulled out of new investors, leaving them to hold the bag.

Still, Palladyne might attract extreme speculators for specializing in artificial-intelligence software for robotic applications. Originally founded in the early 1980s as Sarcos Research Corporation, the company rebranded to Palladyne (smart move) in March of last year to emphasize its focus on AI-driven solutions. Therefore, it’s possible that as more people become attuned to the opportunities in machine intelligence, PDYN stock could ride coattails.

Fundamentally, what’s most attractive about the enterprise is its AI platform, which is designed to enhance the autonomy and intelligence of robotic systems. According to Grand View Research, the global AI in robotics market size was worth $12.77 billion in 2023. By 2030, the sector could command a valuation of $124.77 billion, implying a compound annual growth rate (CAGR) of 38.5%.

While PDYN ranks among the cheap stocks under $10 that could latch onto this immense growth story, the equity is expensive. Right now, shares trade for almost 26X trailing-year revenue. Still, as a long shot, PDYN offers a tempting proposition.

Lucid Group (LCID)

LCID Stock Analysis

To be 100% transparent, the idea of presenting an EV company like Lucid Group (NASDAQ:LCID) as one of the cheap stocks under $10 to buy is super risky. Sure, if former President Biden won reelection via proxy through former Vice President Kamala Harris, then it’d be EVs all day, every day. But with Trump 2.0? I’m not going to get political, but this is not exactly an administration lauding green energy.

Still, what I appreciate about Lucid on a fundamental level is the underlying social cachet. Lucid is a brand that’s trying to be the next luxury must-have for the wealthy. It’s not just four wheels powered by electricity. No, this is an experience equivalent to what only the Germans and Italians can provide — but without the guilt and greenhouse emissions of gas guzzlers.

Of course, it must be said that LCID stock has struggled to resonate with the investing public. Since making its public market debut, the equity has tumbled more than 70%. Still, the valuation could be wildly low right now. Currently, shares trade hands for 8.85X trailing-year revenue. Back in the third quarter of 2024, this metric stood at 12.14X.

Moving forward, analysts anticipate fiscal 2025 sales to hit $1.7 billion. If so, that would be a projected leap of 117.27% above the prior year’s estimated sales of $780.9 million.

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