For retail investors, momentum and trends can be drivers of investment decisions and interest. The stocks that analysts and other investors are talking about most may hold a special appeal (although timing the market and ensuring that you buy in at an appropriate time are difficult challenges). But many of the most popular stocks—companies including Apple Inc. (NASDAQ: AAPL), Amazon.com Inc. (NASDAQ: AMZN), and NVIDIA Corp. (NASDAQ: NVDA)—trade for well over $100 per share, making them inaccessible to some investors.
Investors looking for lower-priced shares of companies with solid growth potential might consider a pool of inexpensive stocks under $20 per share. These are distinct from ultra-cheap penny stocks, often plagued by low liquidity and high volatility, but are nonetheless more affordable for many retail investors.
NU: Efficient Latin American Digital Banking Platform
Brazilian financial services company Nu Holdings Ltd. (NYSE: NU) is the parent of Nubank, a digital banking platform rapidly expanding throughout Latin America. It has also been a favorite of legendary investor Warren Buffett, who has flagged the company as one to watch for many investors.
Nu is part of the highly competitive fintech space, and its performance over the last several years stands out among better-known firms like Block Inc. (NYSE: SQ). Most of these firms soared to lofty heights in 2021 and have fallen since then. Nu shares have climbed more or less steadily in the last year, nearly doubling.
With no physical branches, Nubank is a streamlined operation that keeps expenses low. The platform's member base has recently surpassed 100 million customers and is growing at a mid-20% rate year-over-year. Notably, each new member generates profit for the company almost immediately, as it costs Nu under a dollar per user per month for service charges. Monthly average revenue per active customer as of the latest quarter was $11.20. The company has also recently expanded operations into Mexico and Colombia.
BIOX: Bargain Price for a Long-Term Growth Opportunity
Bioceres Crop Solutions Corp. (NASDAQ: BIOX) aims to develop products and tools to help make crops resistant to drought and climate change and to increase yields. The company has struggled in recent quarters to overcome a bear market in agricultural commodities and to drive profitability while controlling its debt load, prompting a stock decline of more than 28% in the last year.
However, in mid-September, the firm released its latest quarterly report, and the data prompted several Wall Street analysts to reiterate a "buy" rating even as they lowered their price targets. Fourth-quarter revenues climbed by 18% thanks in large part to sales of genetically modified HB4 wheat. This is solid if it is below the expectations of many analysts. Sales of HB4 at lower margins did contribute to relatively flat gross profit and EBITDA.
But there is also reason for optimism: Bioceres announced changes to its approach to HB4 to a more stable, if slower, growth model. Notably, a shift in regulations in the U.S. has opened the door for increased domestic business, which could also have a seismic impact on top-and bottom-line performance. However, it will likely take time to roll out commercialization. This suggests that investors willing to stick with BIOX shares may see significant longer-term growth.
NXE: AI Power Shifts to Nuclear
Nuclear energy is increasingly popular among companies with significant power needs for AI and data center applications. Companies like Microsoft Corp. (NASDAQ: MSFT) and others have announced plans to harness nuclear power for these purposes going forward. NexGen Energy Ltd. (NYSE: NXE) is a leading exploration and development company focused on uranium, a key component of clean nuclear energy.
With the Fed's recent rate cut, oil could be poised for a new bull market. Other energy firms like NexGen will likely get pulled along with it. This, coupled with the secular shift toward renewable energy solutions and increasing demand for nuclear AI power, has prompted analysts to assign an average price target of $11.00 for NXE shares, nearly two-thirds higher than current levels.
Inexpensive Doesn't Always Mean Growth
Just because a company's shares are trading at a bargain relative to other firms does not necessarily mean that those stocks have outsized growth potential. In some cases, as with BIOX above, growth opportunities may be strongest over the long term.
