Uncovering affordable breakthrough stocks under $10 in the portfolio can lead to high-price return opportunities. Here, the focus is on three such stocks, each demonstrating strong fundamentals that signal high upside potential.
The first company’s top prospects include continued revenue growth, significant improvements in gross margins and successful strategic expansions. These position the company for robust future performance in the environmentally sustainable carbon products sector.
On the other hand, the second one has made remarkable strides in Europe. It has grown notable sales and secured important market access and reimbursement approvals.
The third company stands out for its improved credit performance and effective expense management. This reflects the company’s focus on operational edge and financial stability.
Learning the fundamentals behind these stocks is vital to capitalizing on undervalued opportunities with promising fundamentals. These companies’ core strengths and strategic advancements make them top picks for a progressive investment strategy.
Arq (ARQ)
Arq (NASDAQ:ARQ) produces activated carbon and other environmentally efficient carbon products for purification and the application of sustainable materials.
In Q1 2024, Arq posted revenue of $21.7 million, up 4% on the previous year as a function of enhanced contract terms, despite a 6% reduction in volumes due to increased average selling prices and positive changes in product mix.
Moreover, the strategic activities taken by Arq have drastically improved its financial performance, as evidenced by an increase in gross margin to 37% from 17% in the prior year. This strengthens the message that the Company is focused on profitability over volume and is managing operational costs effectively.
Arq hit a crucial strategic milestone with the execution of the first supply contract for its GAC product, totaling a forecast of 5 million pounds per year at excellent pricing. This contract is approximately 20% of the nameplate capacity of Arq’s Red River facility, and deliveries under the contract are expected to commence in Q1 2025.
All in all, such strong revenue growth and incredible expansion in gross margins make Arq a great player in environment-friendly carbon products and a solid addition to the list of breakthrough stocks under $10.
Amarin (AMRN)
Amarin (NASDAQ:AMRN) is a biopharmaceutical company specializing in cardiovascular disease treatments.
In Q1 2024, Amarin attained a 65% increase in in-market sales in Europe against Q4 2023. This is with notable contributions from Spain and the UK. In Spain, the number of patients on VAZKEPA therapy boosted by 91% from Q4 2023 to Q1 2024.
Meanwhile, patient numbers grew by 28% in the UK during the same time frame. The high sales growth in Europe and patient uptake increases in Spain and Britain mark Amarin’s progressive market lead and expansion efforts.
These numbers indicate a growing acceptance and demand for VAZKEPA, supporting its potential for further commercial success.
Moreover, Amarin’s ongoing efforts to secure pricing and reimbursement approvals across European markets may bring solid top-line growth. The company is actively working on pricing and reimbursement approvals in Italy, France, Germany, Greece and Portugal.
Positive outcomes in these markets may derive additional revenue. Further, European net product revenue grew by 35% from Q4 2023, indicating successful market access and reimbursement efforts.
Amarin’s solid sales growth and progress in securing pricing and reimbursement approvals make it a top pick among breakthrough stocks under $10.
Oppfi (OPFI)
OppFi (NYSE:OPFI) is a financial tech company offering credit products to underserved consumers. The company has shown a big improvement in credit performance.
The net charge-off rate measures the percentage of loans that may be uncollectible. This is decreased by 1.1 percentage points annually to 47.9% of total revenue in Q1 2024. This decrease in the net charge-off rate points to improved credit quality and better risk management.
Further, the recoveries of previously charged-off loan balances increased by 33.5% annually. This improvement in recoveries demonstrates OppFi’s enhanced ability to recover funds from previously written-off loans, contributing to its overall financial health.
Certainly, OppFi has made strides in managing its expenses. Hence, total expenses as a percentage of the consolidated top-line increased by 1.1% annually (to 45.5%).
However, excluding one-time expenses and other adjustments, this percentage dropped by 2.7% annually to 40.6%. This reduction in the adjusted expense ratio highlights OppFi’s focus on operational edge and cost control, which may bring rapid bottom-line uplifts.
Overall, OppFi’s focus on operational efficiency makes it a high candidate on the breakthrough stocks under $10 list.
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.