Unlike any of my other screens, this stock screen focuses on stocks trading under $10/share, and have a market cap of around $1 billion or less. As for the variables that I used in the screen, I focused on fundamentals, particularly companies that have a healthy balance sheet with little debt to speak of, with a strong prospect for rapid sales and growth in earnings, as well.
Now be aware, that these kinds of stocks carry huge risks to them. A simple downgrade, news event, or missed earnings target, can derail these small-cap stocks in a heart beat. But if you have some capital that you want to roll the dice with, these stocks will give you a good start in your research.
Back on 6/16/11 when we last ran this screen I said to pay close attention to Ariad Pharmaceuticals (ARIA) at $9.50, and since then it has ramped up 37% up to $13. Fuelcell Energy (FCEL) was the second one I said to consider buying one and it has basically been flat. However, the stock still looks like it is prime for a move higher, once it clears the 50-day moving average. Fibertower (FTWR) was the other one and has managed to move about 7% higher.
I’d also like to add Power-One (PWER) which is sporting a fancy triple bottom and could see a move into the $8’s as a result. A break below recent lows would be your sign to get out of the trade.
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