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Investing in small-cap stocks can be a gateway to high returns, mainly when these companies exhibit strong growth fundamentals and strategic market positioning. Here, the focus is on three stocks to buy under $10. The fundamentals behind these companies may diversify portfolios with high potential. These companies’ financial performance and strategic initiatives explain why these small-cap stocks are poised for high gains.
The first one has consistently demonstrated impressive top-line growth, driven by its diversified financial services. The second one improves healthcare equipment. Its sales strategies have been refined to achieve solid domestic and international revenue increases. Finally, the third one advances its innovative drug pipeline while securing significant financial support. These companies represent different sectors but share a common thread of solid fundamentals and strategic growth. These factors make them sharp investments in the small-cap space.
SoFi Technologies (SOFI)
SoFi Technologies (NASDAQ:SOFI) offers loans, banking and investment services. In Q1 2024, SoFi reported adjusted net revenue of $581 million. This means a 26% year-over-year (YoY) increase. Here, that growth trend has been consistent.
The company attained over 25% growth for 12 consecutive quarters. This sustained growth points to a solid business model capable of scaling and adapting to market demands. The increasing contribution of the financial services segment to SoFi’s overall revenue marks a notable trend. The Financial Services segment grew its top line by 86% YoY, resulting in $151 million in Q1 2024.
Further, this progress points to solid operating leverage, with only an 8% increase in expenses driving high revenue growth. SoFi Money has solid growth, with 3.9 million accounts, up 61% YoY. The average account balance and transaction volume also increased, with debit transaction volume exceeding $1.9 billion, up over 150% YoY. Direct deposit members drive high-quality deposits with a median FICO score of 744, which presents ample cross-selling opportunities.
Finally, the company’s solid top-line growth, constant quarters and strategic expansion solidify its presence on the top stocks to buy under $10.
Inogen (INGN)
Inogen (NASDAQ:INGN) leads the creation and promotion of cutting-edge respiratory treatment. The business has made considerable efforts to enhance its rental and sales tactics, with progressive outcomes. The company’s $78 million Q1 2024 top line represents a 3% sequential gain and an 8% YoY increase. This expansion shows how Inogen’s initiatives are being implemented successfully and that market demand has grown high for its products.
Domestic business-to-business revenue increased by 31.3%. It grew from $12.6 million to $16.5 million. Increased demand from current resellers and acquisition of new clients mainly drove this expansion. Further, this highlights successful efforts to expand market presence and strengthen partnerships.
Moreover, international business-to-business revenue had a high 37.2% increase to $26 million from $19 million in Q1 2023. This reflects the company’s success in global market penetration. Indeed, the higher sales volumes to existing customers reflect strong ongoing relationships and customer satisfaction. For Q2 2024, Inogen expects total sales to be between $81 million and $84 million, indicating continued positive momentum and the execution of strategic priorities.
Overall, Inogen’s progressive refinement of sales and rental strategies makes it a top mark on the list of top stocks to buy under $10.
Scynexis (SCYX)
Scynexis (NASDAQ:SCYX) is a pharma business. Phase I trials for SCY-247 will begin later in 2024, indicating that the business is managing its drug development pipeline well. The National Institute of Health’s financial backing further validates the drug’s potential efficacy and the company’s capacity to obtain non-dilutive financing sources.
Clinical study findings for the CARES, FURI and NATURE studies are scheduled to be delivered to GSK (NYSE:GSK) by the middle of 2024. A $10 million payment to Scynexis will be made in response to this milestone. This demonstrates the company’s fundamental capacity to hit important development goals.
Moreover, a strong cash position of $94.2 million ensures that Scynexis can sustain its research without the immediate need for additional funding. The ability to generate revenue through strategic licensing agreements (like $1.4 million from GSK) points to a diversified and stable revenue model. The company achieved an EPS of 1 cent per share in Q1 2024, against a negative EPS of 71 cents in Q1 2023. This turnaround from a significant loss to a modest profit reflects sharp operational improvement.
Overall, the company’s pipeline advancement into Phase I trials, strong cash position and strategic licensing agreements support its presence among top stocks to buy under $10.
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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.
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