The perfect stock can be hard to find. There are just so many questions to answer, and so many boxes to check. Does it have a reliable history of share appreciation? Is it resilient in hard times? What do insiders think of it, or hedge funds? The forest of possible questions is intimidating, even for experienced investors. It’s part of the reason why successful stock investing is sometime seen as more art than science.
The Investing Insights platform aims to change that, bringing science to bear on the art. The platform collates and categorizes the raw data, making visible the trends in new fewer than 6 informative categories – all of which have been shown to predict stock performance. Distilling the results down to a single-digit score, the tool makes investors a quick reference guide to judge their stock picks.
The results can be interesting. Big-name stocks may turn out to have, according to the data, a low score – and sometimes, the high-scoring stocks are some of the ones you’ve never heard of. Here are three of the latter, some stocks that maneuver under the radar but deserve a closer look.
Lazydays Holdings (LAZY)
Social distancing may have hurt the economy, but some sectors – even some obscure sectors – found it to be an opportunity. Recreational vehicles are one such. With an RV, individuals and families can go on vacation, without breaking the social distancing restrictions so many states have put in place. Lazydays (NASDAQ:), a holding company, inhabits the RV market. Through its subsidiaries, the company sells and leases RVs, and offers essential repair and maintenance services.
LAZY’s Q2 results showed a 27% revenue gain year-over-year, despite the recessionary pressures of the corona crisis. RV unit sales, sales of individual RVs, were up 41%. Overall, the second quarter showed a solid foundation for the company. Since the start of the second quarter, LAZY shares have grown a whopping 673%.
Steven Dyer, 5-star analyst with Craig-Hallum, notes of LAZY that “July EBITDA has already surpassed all of Q3-19 ($5.3M).” He goes on to add, “We believe that LAZY is in the early innings of a multi-year growth period through the consolidation of the highly fragmented RV dealer market. With a robust pipeline of acquisition candidates, we expect the company will continue in its consolidation strategy. We believe this strategy will drive significant shareholder value…”
Dyer’s Buy rating is backed with an $18 price target, implying a 20% one-year upside potential for the shares. Dyer’s is the only recent review on record for this stock. (See LAZY stock analysis)
Airgain, Inc. (AIRG)
How any of you have ever really noticed a cell tower? We’ve grown so used to wifi that we barely ever think about it. But the infrastructure behind our compulsively connected world is a major business, and the first stock on our list holds an important place in it. Airgain (NASDAQ:) produces antenna systems for a range of wireless technologies, especially mobile. The company’s products are used in emergency responder vehicles, IoT applications, and car rental fleets, to name just a few applications.
Mobile connectivity has become essential, even for basic functioning of the modern economy. Even the recent shutdowns could not change that. So, whole AIRG reported steep earnings losses in both Q1 and Q2, when business was forced to a halt due to social lockdown policies, the shares have continued to rise. AIRG is now trading at a net gain of over 30% year-to-date.
Writing on the stock for B. Riley FBR, analyst Craig Ellis sees several routes forward for the company’s profitability: “First, we are pleased large multi-quarter next-gen US and Int’l Carrier programs are back on track with legs well into CY21, albeit with some typical 1Q seasonality. Second, the Enterprise market is rebounding in 3Q20… Third, Auto, Enterprise and next gen Connected Home design win activity appears to be the strongest we recall in four-plus quarters…”
The analyst concluded, “Overall, we believe AIRG is significantly upgrading revenue quality and growth potential and design win conversion to revenues seem to be gaining steam, auguring well for long-term growth and EPS leverage.”
Ellis sets a price target of $20, implying a robust upside potential of 46% and fully supporting his Buy rating.
Overall, with 2 recent Buy ratings, Airgain has a Moderate Buy rating from the analyst consensus. Shares are selling for $13.77, and at $21.50, the average target indicates room for 56% growth in the coming year. (See Airgain stock analysis)
Last on our list of ‘perfect 10’ stocks today is CleanSpark (NASDAQ:). This company is both a software maker and a green/clean energy company, offering software and control systems for microgrid and distributed energy resource systems. In short, Cleanspark offers the control technology needed for off-the-grid, cleaner and greener energy systems.
Cleanspark stock has been listed on NASDAQ since the end of January this year, and in that time it has nearly doubled in price. The market turndown in February/March hurt the share price, but only temporarily. Since hitting bottom in early April, CLSK has bounced back an astounding 830%. The stock’s recent gains have pushed the price up high, and its recent performance has dramatically outpaced even the NASDAQ’s strong gains.
When a stock surges like this, it’s no wonder that it also earns a perfect Smart Score. For Cleanspark, that score is resting mainly on investor and news sentiment. Investors have been buying up the shares – of course, that shows by the gains – and so the weekly investor sentiment measure is positive. But news coverage of the stock is also good – 100% bullish. Cleanspark benefits here from being a ‘clean energy’ company, providing services in a sector that is ‘politically correct.’
From H.C. Wainwright, 5-star analyst Amit Dayal writes of Cleanspark, “[The] company’s software offering pipeline at $10.0M remains healthy, with wins like the $300K contract announced on July 29, 2020, continuing to come through. CleanSpark’s shift away from lower margin construction aspect of deployment to higher margin energy storage, controls, and related software offerings remains in place and positions it, in our opinion, for better long term profitability…”
Dayal puts a Buy rating here, supporting it with an $18 price target that suggests room for strong 76% growth in the next year. Dayal’s rating is the only one on file for Cleanspark at the moment. (See Cleanspark stock analysis)
To find more ideas for stocks trading at attractive valuations, visit Investing Insights.