Finding promising, affordable stocks can yield substantial returns while making investments. Here, the focus is on three bargain stocks under $15, poised for considerable growth by 2026. These stocks present opportunities for capital appreciation based on resilient business models capable of navigating dynamic market conditions.
Understanding the fundamentals of these companies becomes crucial for potential high returns on modest investments. The fundamentals behind these companies may shoot their market valuation by a multifold jump in the mid-term.
Each company excels in distinct sectors, from power solutions to data management and healthcare services, leveraging strategic advancements to enhance profitability and expand market reach. As these stocks trade below $15, they offer accessible entry points for investors looking to diversify their portfolios with growth-oriented assets.
Capitalizing on these companies’ operational efficiencies, market expansion and strategic initiatives may bring higher value to portfolios. These top stocks present an opportunity to align high financial goals with their fundamental growth prospects.
Power Solutions (PSIX)
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Power Solutions (OTCMKTS:PSIX) operates in engines and power systems for industrial, agricultural and energy markets. The company’s fundamental ability to boost its profitability against market adversities. For instance, during Q1 2024, the company experienced a sharp uplift in its bottom line. Specifically, there is a critical improvement in Power Solutions’ gross margin. For the quarter, Power Solutions’ gross margin was 27%, representing an increase of 6.8 percentage points against 20.2% a year ago. Hence, this signifies Power Solutions’ capability to expand its profitability through core operations.
Additionally, Power Solutions’ net income was $7.1 million, a 91% increase from $3.7 million in Q1 2023. Power Solutions’ increasing EPS further indicates the bottom-line expansion. It rose from 16 cents in Q1 2023 to 31 cents in Q1 2024, an increase of 15 cents per share. This indicates that the company generates more profit per share, potentially leading to higher stock valuations.
To conclude, Power Solutions is on the bargain stocks under $15 list due to its solid bottom-line performance and potential for growth in the power solutions sector.
Data Storage (DTST)
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Data Storage (NASDAQ:DTST) provides data protection, recovery and cloud solutions. The company has demonstrated sharp revenue growth. In the first quarter, the company enjoyed a near-20% boost in top-line sales, which hit $8.2 million from $6.9 million in Q1 2023. This indicates the company’s expanding market presence and effectiveness in securing new contracts. The growth here is primarily based on infrastructure, disaster recovery cloud services, equipment and software sales.
Further, the company’s gross profit surged by 42% annually during the period. This considerable increase in gross profit points to the scalability of Data Storage’s business model. Moreover, the gross profit margin uplifted to 36% from 30% in Q1 2023. Hence, this margin expansion signals the company’s extended fundamental ability to sharply transform its top line into profits. Data Storage had net income of $357,000 versus $50,000 last year. Indeed, this shift to profitability reflects Data Storage’s progressive strategic initiatives and operational edge.
In short, Data Storage is included on the bargain stocks under $15 list for its sharp revenue growth, profitability and business model.
SelectQuote (SLQT)
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SelectQuote (NYSE:SLQT) excels in the insurance marketplace. The company’s healthcare services segment surpassed expectations, with membership exceeding 75,000 in Q3 fiscal 2024, well above initial forecasts. This growth demonstrates solid market penetration and boosts immediate cash flow benefits. The embedded profit potential in this segment underscores its strategic importance and contribution to SelectQuote’s overall financial health. SelectQuote has made considerable strides in improving funding costs and leverage through the securitization of receivables, amounting to over $1 billion.
Moreover, this financial strategy aims to enhance cash flows by accelerating receivable payments. Thereby, it is improving cash efficiency and overall returns on capital. The potential benefits also include debt repayment and extensions of loan maturities. Indeed, this collectively strengthens the balance sheet and reduces financing costs.
The Medicare Advantage business has a solid operational edge. There is a nearly 30% reduction in operating expenses per policy over the past two years (against 2021). It is driven by strategic shifts towards more efficient core senior agents. Hence, this operational focus improves cost structures with solid customer satisfaction and policyholder retention.
Overall, SelectQuote stands out in the bargain stocks under the $15 list for exceeding membership expectations and sharp operational performance.
On the date of publication, Yiannis Zourmpanos did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Yiannis Zourmpanos is the founder of Yiazou Capital Research, a stock-market research platform designed to elevate the due diligence process through in-depth business analysis.
