【new home construction cost per square foot ithaca】2 Beaten-Up Penny Stocks That Are Set for a Rebound
With the outbreak of the coronavirus,new home construction cost per square foot ithaca volatility has become a seemingly ever-present facet of the stock market. While the current economic landscape has spurred fear among investors, others view market volatility as a unique buying opportunity.
Opportunity is the key word – and sometimes the hardest thing for investors to see. To find names that can deliver solid returns and now come with a bargain price tag, investors will often turn to penny stocks, or those trading for less than $5 per share.
Sure, there could be a very good reason these tickers are so affordable, but should there be even minor share price appreciation, massive percentage gains could materialize, along with hefty profits for investors.
So, how are investors supposed to determine which names have what it takes to make a comeback? Follow the pros.
Using
TipRanks’ database
, we were able to pinpoint two promising penny stocks, according to the analyst community. Although each has fallen below $3, the Buy-rated tickers appear poised to take off on an upward trajectory, boasting colossal upside potential.
Xeris Pharmaceuticals (
XERS
)
Based on its innovative technology platform that enables ready-to-use, room-temperature stable formulations of injectable and infusible therapies, Xeris Pharmaceuticals provides solutions that simplify the process of administering important therapies. Even though its public offering prompted a serious sell-off on June 25, with the one-day loss coming in at 49%, the new $2.59 share price could allow investors to get in on the action before XERS blasts off.
Representing Piper Sandler, analyst
David Amsellem
believes that the Street is underestimating XERS. Pointing to the results from its Phase 2 proof-of-concept study evaluating XP-3924, its liquid-stable, ready-to-use (RTU) coformulation of pramlintide and insulin in adult patients with type 1 diabetes, the analyst is optimistic about the candidate’s prospects going forward.
The trial was designed as a randomized, open-label, 3-arm, cross-over study enrolling 18 adult participants, who were randomized to receive subcutaneous injections (SC) of XP-3924, regular insulin or co-administration of Symlin and insulin. It should be noted that Symlin is AstraZeneca’s product that needs to be injected separately from insulin, while Xeris' asset is given as a single injection.
Importantly, post-prandial treatment with XP-3924 resulted in a 62% decrease in hyperglycemia compared to treatment with insulin alone. Adding to the good news, Amsellem highlights that glycemic control associated with XP-3924 was in line with that of the co-administration of pramlintide-insulin, and that glucose variability, or the variation of all plasma glucose levels across the six-hour monitoring period, was lower in patients treated with XP-3924 versus insulin alone and the co-administration of insulin with Symlin.
Story continues
“We do not believe that meaningful value is being ascribed to this opportunity (or other pipeline shots-on-goal for that matter), given our bullish view of the opportunity for Gvoke in severe hypoglycemia rescue (i.e., peak U.S. sales of $250 million-plus are realistic),” Amsellem commented.
Looking ahead, Amsellem expects XERS to seek out a development partner, with management indicating “it could play a role in pramlintide-insulin commercialization with a partner given that the company already calls on endocrinologists in its support of Gvoke.” The analyst added, “As an aside, management also suggested that it would seek a partner for its injectable diazepam product for seizure clusters, though this is a relatively inexpensive development program focused on a concentrated prescriber audience, so in that vein, keeping full rights here would not be out of the question.”
To this end, Amsellem rates XERS an Overweight (i.e. Buy) along with an $11 price target. This target implies shares could climb 326% higher in the next year. (To watch Amsellem’s track record,
click here
)
Do other analysts agree with Amsellem? They do. Only Buy ratings, 4, in fact, have been issued in the last three months, so the consensus rating is a Strong Buy. At $12.50, the average price target puts the potential twelve-month gain at 373%. (
See XERS stock analysis on TipRanks
)
Avinger (
AVGR
)
Avinger is a medical device company that designs and develops the first and only image-guided, catheter-based system for the diagnosis and treatment of patients with Peripheral Artery Disease (PAD).
AVGR also tumbled recently on account of a $5.4 million public offering. Currently going for only $0.29 apiece, one member of the Street believes that now is the right time to snap up shares.
Aegis Capital’s
Nathan Weinstein
notes that its recent capital raise via equity financing, its $2.3 million PPP loan and cash and equivalents of $9.9 million as of March 31, as well as its efforts to trim operating costs “have helped strengthen the company's balance sheet and financial runway.”
Weinstein doesn’t dispute the fact that the current operating environment presents significant challenges including a pull-back in sales thanks to the pandemic, and a move to utilize virtual sales and marketing tools. That being said, AVGR’s clinical representatives continue to operate on customer sites when it’s possible.
Expounding on this, the analyst stated, “A lack of clarity regarding a ‘return to normalcy’ pervades markets broadly, and PAD procedures are no exception. With that said, our current outlook calls for a gradual return to normalcy in patient volumes and customer ordering activity as we move forward through the calendar.”
On top of this, there are several key catalysts on the horizon, in Weinstein’s opinion. These include the 510(k) submission for the Ocelaris image-guided CTO crossing catheter this quarter, the 510(k) submission for the L300 imaging console in 2H:20 and the completion of the INSIGHT IDE clinical study, which was designed to assess the safety and efficacy of Pantheris as a treatment for in-stent restenosis. Should the results be positive, they could support label expansion for Pantheris.
“While we think each of these on their own are important, when we step-back and view the overall portfolio being completely refreshed, we believe the salesforce will be well-positioned to capitalize on the large PAD-treatment opportunity, especially when case volumes return,” Weinstein commented.
In line with Weinstein’s optimistic take, he reiterates a Buy recommendation on AVGR. His $1.40 price target implies a twelve-month gain of 368% from current levels. (To watch Weinstein’s track record,
click here
)
AVGR has stayed relatively under-the-radar so far, with its Moderate Buy consensus rating breaking down into 1 Buy and 1 Hold. Additionally, the $1.40 average price target matches Weinstein’s. (
See Avinger stock-price forecast on TipRanks
)
To find good ideas for penny stocks trading at attractive valuations, visit TipRanks’
Best Stocks to Buy
, a newly launched tool that unites all of TipRanks’ equity insights.
View comments
(责任编辑:Hotspot)
- Apple's New Deal With Amazon Prime Video Is a Game Changer
- Oil's Recovery Could Take Decades, Not Years
- The Global Virtualization in Industrial Automation Market is expected to grow by $ 216.39 mn during 2020-2024 progressing at a CAGR of 4% during the forecast period
- Here's How Long It Took Apple To Reach A $100B Market Cap
- Asian Shares Lower as US-China Tensions Weigh on Investor Sentiment
- IMPORTANT INVESTOR NOTICE: The Schall Law Firm Announces the Filing of a Class Action Lawsuit Against Inovio Pharmaceuticals, Inc. and Encourages Investors with Losses in Excess of $500,000 to Contact the Firm
- Rackspace Technology Among the First to Support the Launch of Professional Services in AWS Marketplace, Announces New Professional Services & Solutions at AWS re:Invent 2020
- Livestock Diagnostics Market Worth $1.85 billion by 2027, Growing at a CAGR of 7.8% from 2019- Exclusive Report by Meticulous Research®
- S&P 500 Preview – Security Software and Retail Headline Tuesday’s Earnings
- AUD/USD Forecast: Bottomed At 0.6038, At Risk Of Losing The 0.6000 Level
- Recap: eXp World Holdings Q1 Earnings
- Managers’ transactions - 1
- 5%, led by a 17% increase in average ticket and a slight decline in traffic. Growth in the quarter reflected the impact of households stocking up on essentials like paper goods and cleaning supplies as the pandemic became a nationwide concern, along with strength in discretionary categories as the quarter came to a close and stimulus dollars and tax refunds were disbursed.
As shown below, the results in the quarter materially changed the trend in two-year stacked comps for each of the banners, along with a significant acceleration for consolidated comps.
The increase in consolidated comps was the primary driver of an 8% increase in revenues to $6.3 billion. The company ended the quarter with 15,370 locations, up less than 1% year-over-year. This reflects a 7% increase in Dollar Tree units, offset by a 4% decline in Family Dollar units.
The top-line results at each banner flowed through to their respective income statements, with Dollar Tree gross margins and operating margins declining year-over-year while Family Dollar gross margins and operating margins expanded year-over-year. On a consolidated basis, gross margins contracted by 120 basis points in the quarter to 28.5%, reflective of a shift to lower-margin consumables, tariff costs and the impact of markdowns from the Easter headwinds at the Dollar Tree banner. The company saw slight operating leverage on SG&A from higher comps, with the net result being an 80 basis point contraction in operating margins to 5.8%, with operating income declining 5% to $366 million. This is not adjusted for $73 million of pandemic-related costs, such as PPE supplies.
In the first quarter, the company opened 85 stores (net of closures) and completed 220 Family Dollar renovations to the H2 format. Importantly, comps at renovated Family Dollar stores continue to outpace the chain average by more than 10%. On the call, management indicated that they plan on reducing both the number of new store openings (from 550 to 500) and the number of H2 renovations (from 1,250 to 750) in 2020.
Personally, given the fact that Family Dollar is seeing material benefits to its business from the pandemic with new or lapsed customers coming into its stores, I think the company should try to get more aggressive with its renovation plans, not less. On the other hand, you could argue that renovations cause short-term disruptions and limit their ability to fully capitalize on the business momentum they are currently experiencing.
As a result of fewer new stores and remodels, management now expects 2020 capital expenditures to total $1.0 billion compared to previous guidance of $1.2 billion. In addition, the company has temporarily suspended share repurchases. At quarter's end, the company had $1.8 billion in cash on its balance sheet compared to $4.3 billion in total debt.
Conclusion
In recent years, Dollar Tree has been a tale of two cities. While its namesake banner has generally delivered impressive financial results, Family Dollar has been a persistent underperformer. This quarter, those results flipped, and given what we've seen in the weeks since quarter's end, there's a decent possibility that we will see something similar in the coming months. As the CEO noted, the second quarter is off to a very good start at Family Dollar.
Here's the important question: how useful is that information is in terms of making future predictions about the business? Will recent success at Family Dollar translate into long-term success for the banner? The optimistic take is that new or lapsed customers, especially those visiting the renovated stores, could become recurring business for the banner. The pessimistic take is that they have experienced short-term success out of necessity as people went to any store that was open to try and find essentials like toilet paper and hand sanitizer that were largely out of stock throughout the retail landscape. From that view, many of these customers could abandon the retailer when life returns to normal. As Philbin noted on the conference call, early on [during the pandemic], folks needed us. Will people still shop as much at Family Dollar when it's no longer a necessity?
Personally, I do not place too much weight on the recent results. I will need to see incremental data points that indicate that Family Dollar has truly won sustained business from these new customers. While I still believe that the Dollar Tree banner is a well-positioned retailer with attractive unit returns, I'm not yet willing to say the same thing for Family Dollar. For that reason, along with the recent run-up in the stock price, I plan on staying on the sidelines for now.
Disclosure: None
Read more here:
Under Armour: A Tough Start to 2020
Walmart: Continued Omni-Channel Progress
Match: An Impressive Start to 2020
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
This article first appeared on
GuruFocus
.
Warning! GuruFocus has detected 4 Warning Signs with DLTR. Click here to check it out.
DLTR 30-Year Financial Data
The intrinsic value of DLTR
Peter Lynch Chart of DLTR
View comments
- GREATERGOOD.ORG ANNOUNCES “THANK YOUR TEACHER” CHALLENGE ON THE NEW GIRLS’ VOICES AT HOME PLATFORM
- Waiting for passengers, American puts Boeing Max in the air
- Mortgage Rates Are Lowest Ever; 12.8M Should Refinance
- Global watchdog warns over financial staff curbs in pandemic
- Is Focus Financial Partners (FOCS) a Great Growth Stock?
- Read This Before Selling Altura Mining Limited (ASX:AJM) Shares
- Which Consumer Staples Stock Will Grow The Most By 2025?