Related topics: growth stocks, transportation, mortgage, stock market, technology
Why do people gamble? The thrill of winning big, the chance to make a fortune by putting up just a little bit of money. Well, you can do the same with stocks, and if you pick the right ones, your odds are a lot better than they would be in a casino.
Here are some of the best low-priced stocks to consider. Each is trading below $7 per share.
Horizon Lines
Horizon Lines (HRZ, news) ships containers filled with building supplies, food and consumer goods to and from the continental United States, Alaska, Hawaii, Guam and Puerto Rico.
The steady resurgence in shipping demand, coupled with Horizon's improving financials, suggests that the worst of the economic downturn is over for the Charlotte, N.C., company.
The stock is up about 37% over the past six months and could continue moving higher -- data show that more goods are being manufactured, and they need to be shipped. Horizon will be a big beneficiary of that.
Investors should consider buying the stock on pullbacks below $5 a share.
Local.com
Local.com (LOCM, news) is a specialist in paid-search advertising. Its search website, Local.com, attracts about 20 million unique visitors a month. It also operates a local syndication network of some 750 regional media sites, as well as a sales and advertiser services operation for its 50,000 direct monthly subscribers. The Irvine, Calif., company, one of the three fastest-growing companies in local online advertising, works with partners to offer daily online deals, coupons and retail offers.
The company swung to a profit in its fiscal third quarter as sales grew by 48% to $22.5 million and adjusted net income increased 249% to $4.6 million. That translated into some very nice margins, with adjusted net income margin coming in at 20%.
Local.com is growing at roughly twice the rate of its competition and is in a prime spot for one of the behemoths in the industry, such as Yahoo (YHOO, news) or Google (GOOG, news), to take a bite.
Investors should consider buying the stock under $6.70 a share, which is slightly below where it traded earlier this month before a big sell-off that dropped the price to $4.11 on Jan. 20.
Tii Network Technologies
Tii Network Technologies (TIII, news) makes surge-protection devices used by telecommunications companies to protect their equipment during lightning strikes and power surges.
Large telecommunications companies like Verizon Communications (VZ, news) are among its biggest customers. Other customers include DirecTV (DTV, news) and TE Connectivity (TEL, news).
As Verizon and other wireless carriers invest to upgrade to 4G networks, Tii's sales should remain strong.
Investors should consider buying the stock under $3. Because shares are thinly traded, it's worth considering use of a limit order within 10 cents of the previous day's closing price.
PMI Group
PMI Group (PMI, news) is one of the nation's largest providers of residential mortgage insurance, which protects lenders in case of borrower default.
Shares in the Walnut Creek, Calif., company could break out if the housing market improves. There has been some improvement in mortgage applications and housing inventory; interest rates remain low; and banks are starting to lend again.
