In this article, we will discuss: 10 Best One Dollar Stocks To Buy Now.
The upward trend in the stock market has resumed, supported by strong first-quarter and second-quarter results that have relieved investor concerns about inflation. The US economy had a very strong year in 2023. Economic activity increased steadily, job creation was high, unemployment was low, real earnings rose, and inflation declined. Furthermore, the Federal Reserve maintained high interest rates throughout this time in an attempt to control inflation. June recorded a market increase of more than 10%. The large-cap market of the 500 biggest companies has already surged over 17% so far this year as analysts look forward to reduced interest rates in the second half of 2024, along with higher earnings growth and lower inflation.
Historically, since 1928, July has been the strongest month of the year for stocks in terms of performance. The market rose by 1.7% in July. Given that the market posted gains in May and June despite notable economic uncertainty, investors remain bullish that the market can sustain its positive trend.
In a May speech to the Foreign Bankers’ Association, Federal Reserve Chair Jerome Powell recognized the difficulty of bringing inflation down to the desired level. Powell stated that it could be essential to keep interest rates at their present levels for a longer period of time. Interest rates have been fluctuating between 5.25% and 5.5% since July 2023.
Amid concerns over an impending recession brought on by higher interest rates, the US labor market still remains stable. According to the Labor Department, the US economy created 175,000 new jobs in April, although this was less than the 240,000 jobs that economists had predicted. The US labor market maintains a low unemployment rate of 3.9%, while US wages have risen 3.9% YoY. Nonetheless, recession fears are maintained by the historical recession predictor, the inverted U.S. Treasury yield curve, and the New York Fed’s model, which projects a 50% chance of a recession within the next 12 months.
The second quarter of 2024 saw a gain of more than 3% in the US stock market. Under the hood, tech companies continued to lead the artificial intelligence trade, which showed no signs of slowing down throughout the quarter. One striking trend in the stock market this year has been the outperformance of the biggest companies. The large-cap market of the 500 biggest companies gained 4.4% in Q2, bringing its 2024 return to more than 15%. By comparison, the small-cap market had a decline of 3.3%, resulting in a reduced 2024 return of 1.6%.
With over half of 2024 already gone, the US stock market is expected to see significant increases for the second year in a row.
According to DataTrek Research co-founder Nicholas Colas, the 2024 stock market surge is about more than just this year; it also includes the outlook for 2025 and 2026. Colas stated:
“Markets are convinced that U.S. large cap companies will see many years (not just one) of improving earnings. Earnings for 2024 only have to come through slightly better than last year, and nothing occurs on the macro side (economic growth, geopolitics) to derail further earnings growth in 2025 and 2026.”
Investor confidence is supported by historical trends and recent earnings performance. The stock market does well in election years, according to historical statistics, especially when the president is serving his first term, as is the case with Joe Biden.
With that said, here are the 10 Best One Dollar Stocks To Buy Now.
Stocks
Methodology:
In this article, we first used a stock screener, Finviz, to list down all stocks trading under $1.5 and above $0.85 (as of the writing of this article) with over 40% institutional ownership. From the resultant dataset, we chose 10 stocks with the highest number of hedge fund investors, using Insider Monkey’s database of 920 hedge funds in Q1 2024 to gauge hedge fund sentiment for stocks. We have used the stock’s Revenue Growth Rate (year-over-year) as a tie-breaker in case two or more stocks have the same number of hedge funds invested. We only considered stocks that received “buy” or “strong buy” recommendations from analysts.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here)
10. CarParts.com, Inc. (NASDAQ:PRTS)
Number of Hedge Fund Investors: 12
CarParts.com is an online retailer that specializes in aftermarket vehicle parts and accessories. It is based in Torrance, California. PRTS provides a variety of products, such as performance accessories, mechanical and electrical components, and replacement parts, to individual customers via its online marketplaces and e-commerce websites. Automobile body and repair shops are another target market for CarParts.com. The company, along with its subsidiaries, distributes aftermarket car parts and accessories in the United States and the Philippines.
During the COVID-19 pandemic lockdowns, the company and its shares saw tremendous growth, with a share price peaking at $19.50 in 2021, which is similar to the trend observed in many online companies. Sales increased in the second, third, and fourth quarters of FY2020 by 60% to 90% year over year. Nevertheless, when these pandemic-driven tailwinds faded, CarParts.com encountered difficulties, as seen by the stock’s poor performance over the last three years. The stock price has decreased by over 93% since 2021, as of July 16.
CarParts.com reported sales of $166.29 million for the first quarter of 2024, which was higher than the analyst consensus expectation of $160.20 million but represented a 5.24% drop from the same period the previous year. The company reported a $6.5 million net loss, which is an increase from the $1.1 million loss during the same time last year. Due to higher outbound transportation costs and selling price compression, gross margins fell by 3.22%, and adjusted EBITDA dropped to $1.1 million from $9.4 million. In spite of these difficulties, the company released a mobile app in 2023, which is significant for PRTS because it currently accounts for more than 8% of PRTS’s overall eCommerce sales.
Analysts urge investors to “buy” PRTS, which is now trading for $1.12. With an average price objective of $3.00, the company presents investors with a 169.06% potential upside. With no revolver debt, the company has about $46.0 million in cash and marketable securities. As of the end of the first quarter of 2024, 12 hedge funds out of 920 hedge funds had a stake in CarParts.com, Inc. (NASDAQ:PRTS), according to Insider Monkey’s data. AQR Capital Management, managed by Cliff Asness, owns 1,846,142 shares of the firm, valued at $2.10 million.
Analysts predict that revenue will rise to $175.38 million in Q2 2024. The revised outlook by the company is bleaker, however, since net sales estimates have been reduced from $662-$688 million to $600-$625 million for 2024. On the other hand, the rise in projected gross margin from 31% to 33% is a positive indication of increased profitability. However, we are concerned about the company’s weak or negligible sales growth and persistent profitability issues and recommend caution.
In order to stand out from the competition in the online car parts business, CarParts.com must improve both its customer experience and operational efficiency. The company’s strategic goals, which include the release of the mobile app with more organic downloads, higher ASPs, repeat sales, and continuous attempts to control costs, are intended to increase sales and boost profits. In Q1 2024, headcount reductions were made to mitigate the impact of gross margin drops by reducing the workforce, showing operational efficiency. CarParts.com has had financial problems recently, but it still has enough cash on hand to fund its expansion plans and weather market turbulence. The company also received 38% of its e-commerce income from loyal, returning clients, and its website had over 100 million views in Q1 2024, demonstrating the strength of its online presence.
David Meniane, CEO, stated:
“We are well positioned to capture the tremendous and growing opportunities within the highly fragmented and underserved four hundred-billion-dollar aftermarket auto parts industry.”
In conclusion, CarParts.com’s solid cash position and positive valuation measures suggest that the company may rebound, but investor trust depends on profitability. Notwithstanding the need for the company to increase sales and boost profitability, analysts are generally cautiously hopeful.
9. Oatly Group AB (NASDAQ:OTLY)
Number of Hedge Fund Investors: 13
OTLY is the world’s first and one of the largest oat beverage companies. Its only focus for more than 25 years has been on gaining knowledge about oats, a crop of great worldwide importance with natural qualities that are beneficial to both human health and the environment. The company’s focus on oats has led to technological improvements that have expanded its dairy offering, including alternatives to milk, ice cream, yogurt, cooking creams, and spreads. Globally, its Oatly brand is accessible in over 20 countries, with its headquarters being in Malmo, Sweden.
The 7 Wall Street analysts with 12-month forecasts for OTLY stock have an average price target of $2.11, maintaining a “Buy” rating. This average price target predicts an upside potential of 91.82% from the current stock price of $1.10. At the end of Q1 of 2024, Oatly Group AB (NASDAQ:OTLY) was held by 13 hedge funds, with Jeffrey Tannenbaum’s Fir Tree holding the largest stake of 4,736,083 shares valued at a total of $3.53 million.
Oatly’s (NASDAQ:OTLY) present market capitalization of $635.73 million is based on steady GAAP net loss quarters and operating cash burn as compared to a balance sheet with decreasing liquidity. The oat milk company has created plant-based products that are actually in demand. During the first quarter of fiscal 2024, revenue of $199.16 million was generated, 1.8% higher than the same quarter in the previous year and $1.49 million beating the consensus estimate. Both the Europe & International and North America sectors had strong growth in Q1, which contributed to the rise in revenue. The company projects that its revenue will grow by 5% to 10% on a constant currency basis for the entire fiscal year 2024. This would indicate that for the entire year 2024, revenue would be at least $822 million.
Oatly’s North American and European & International operations rose by 4.6% and 7.7%, respectively, in the first quarter of 2024 from the same quarter last year on a constant currency basis. As a result of SKU reductions to increase manufacturing efficiency, sales in Greater China fell by 26.8% in the same quarter. Oatly’s cash burn from operations decreased to $39.1 million from $71.2 million in the first quarter of last year, while the company’s net loss for the first quarter was $45.8 million, down from $75.6 million. Including capital expenditures, the company’s cash runway is less than six quarters, since it completed the quarter with $209 million in cash and $453.8 million in total debt.
Considering that Oatly’s financial runway, including capital expenditures, is less than five quarters, the company’s primary risk is rapid cash burn. Though the projection for negative adjusted EBITDA of $35 million to $60 million in 2024 suggests persistent difficulty, the company is still aiming for profitable growth. Oatly faces competition from other oat companies, such as Alpro and supermarket generics, despite solid expansion in the plant-based sector.
Although Oatly has made significant strides toward reducing losses, the business must act quickly to turn a profit before depleting its cash reserves. Oatly’s significant capital burn and constrained liquidity continue to be concerns, even as the market as a whole continues to trend toward plant-based goods. Nonetheless, given the company’s global reach and standing as a pioneer in oat beverages, investors continue to have high hopes for its development potential.
8. Adaptimmune Therapeutics plc (NASDAQ:ADAP)
Number of Hedge Fund Investors: 14
Adaptimmune Therapeutics plc (NASDAQ:ADAP) is a biotechnology company. It develops treatments for cancer. Their pipeline includes Afami-cel, which has demonstrated positive results in solid tumors, as well as Lete-cel, which targets soft tissue sarcoma. ADAP is one of the best one-dollar stocks to buy now, since ADAP has received a “buy” recommendation from analysts. Adaptimmune Therapeutics plc (NASDAQ:ADAP) has an average Wall Street analyst price target of $4.29, indicating a possible 253.09% upside from the company’s current $1.22 price. As of the end of the first quarter of 2024, 14 hedge funds out of the 920 funds reported having stakes in Adaptimmune Therapeutics plc (NASDAQ:ADAP). The company’s main investor is Matrix Capital Management which is managed by David Goel and Paul Ferri and has 38,974,185 shares worth $61.58 million.
Afami-cel, the flagship product of ADAP, is an engineered cell treatment guided by MAGE-A4 that targets soft tissue sarcomas. The FDA is now reviewing its application for a biologics license, and an action deadline of August 4, 2024, is set. Clinical evidence demonstrates notable action in a range of solid tumors, indicating a critical juncture for ADAP. Second, at an ASCO presentation, Lete-cel, a NY-ESO1-targeted T-cell therapy, showed a 40% response rate in 45 patients with synovial sarcoma and myxoid/round cell liposarcoma. Concerns about cytokine release syndrome and toxicity persist despite the encouraging operations. Thirdly, phase 2 trials for Uza-cel are targeting platinum-resistant ovarian cancer, while phase 1 trials are still underway for malignancies of the bladder and head/neck. The big news is that its development is supported by a partnership with Galapagos that might be valued at $500 million.
In cash and equivalents, ADAP has $140.7 million as of the most recent earnings report. Due to the end of the Astellas cooperation and $55 million in operating expenses, the firm recorded $5.7 million in revenue, an 88.07% decline from the same quarter last year. This translated into a $48.5 million net loss. A runway of around three quarters is implied by the cash burn rate of 12.34% from the same quarter the previous year. Nevertheless, the Galapagos agreement extends the runway until late 2025 with an upfront payment of $100 million and a $125 million loan from Hercules Capital to assist with the successful launch of the lead asset, afami-cel for synovial sarcoma.
The diverse ADAP pipeline, including lete-cel, uza-cel, and afami-cel, lessens reliance on a single product and highlights the company’s strong development approach. Its strategic partnership with Galapagos expedites product development and fortifies its financial position even further.
However, approval from authorities is still pending, especially for afami-cel. Stock value may be greatly impacted by a negative FDA ruling. Even with recent financial gains, as seen by its annual revenue growth over the years, long-term viability still depends on successful product launches, mainly because of the high cash burn rate over the years. Hence, the company’s strong cash burn indicates how much its financial health depends on favorable regulatory decisions.
The company is confident in the approvability of the lead assets, afami-cel and lete-cel, as well as the timely authorization of afami-cel on/by the 8/4 PDUFA. If the FDA’s impending ruling on Amfami-cel is favorable, the value might rise dramatically. Regulatory and financial hazards persist despite advancements in clinical practice and business alliances. Investors should evaluate the possible benefits against these risks, keeping in mind the large negative impact if regulatory permission is not received. If the FDA rules in favor of ADAP, the stock would become more competitive, and risk-averse investors would be justified in maintaining a “Strong Buy” rating.
7. Ur-Energy Inc. (NYSE:URG)
Number of Hedge Fund Investors: 18
Ur-Energy Inc. (NYSE:URG) is involved in the purchase, exploration, development, and operation of uranium mineral properties. Ur-Energy (NYSE: URG) is a strong competitor in the uranium industry, with a unique opportunity to capitalize on the current state of the market right now. Given its strategic emphasis on in-situ recovery (ISR) uranium mining in the United States, the company is pioneering an expanding industry that is being pushed by both supply limits and growing worldwide demand. Having been established in 2004, the firm has been producing uranium for little more than a decade.
The increasing recognition of nuclear energy as a dependable, clean substitute for fossil fuels has propelled a notable upswing in the uranium market. The IEA expects global nuclear generation to be almost 10% higher in 2026 compared with 2023. Since starting operations, the company has produced and packed about 2.7 million pounds of U3O8 from Lost Creek, while 2.2 million pounds per year are allowed for the processing plant, Ur-Energy takes advantage of this trend. This plant, in operation since 2013, demonstrates the company’s capacity to continue producing at a low cost and turn a profit despite changes in the price of uranium. The company holds interests in 12 projects located in the United States.
Analysts have given URG a “strong buy” rating. The average Wall Street analyst price target for Ur-Energy Inc. (NYSE:URG) is $2.65, which presents a 97.03% upside potential from the current price of $1.35. According to Insider Monkey’s Q1 2024 database, 18 hedge funds made investments in this company. With 14,584,181 shares worth $23.33 million, Daren Heitman’s Azarias Capital Management held the largest stake in the company.
Significant advancements have been announced by the firm in its Q2 2024 reports. Despite guiding to the lower end of their 2024 target of 550,000 to 650,000 pounds, Lost Creek operations showed a quarter-over-quarter rise in output, with 70,679 pounds collected, 64,170 pounds dried and packaged, and 70,390 pounds transported.
The engineering and construction work at Shirley Basin is progressing, and the placement of monitor wells is proceeding as planned. The CEO, John W. Cash, stated in his latest letter to shareholders that in Q1 2026, Ur-Energy hopes to have the Shirley Basin project operational, tripling its operations and increasing capacity to 2.2 million pounds annually. The strategy of the satellite plant will reduce expenses and improve profits, resulting in an increase in cash flow.
With a gross profit margin of around 32%, the company made $4.6 million in revenue by selling 75,000 pounds of U3O8 for $61.65 per pound. Hence, revenue visibility is provided by recent contracts and sales agreements, with an anticipated increase in output. Ur-Energy projects $33.1 million in sales revenue for 2024. In 2025, 730,000 pounds of U3O8 will be delivered as part of future obligations; additional agreements will guarantee up to 100,000 pounds a year between 2026 and 2029. These commitments, together with projected price rises for uranium, put Ur-Energy in a favorable position for increased revenue growth and shareholder value.
URG celebrated an incredible yearly revenue increase, surging by 92947.37% to 17.68 million from $0.02 million in 2023. Ur-Energy’s existing manufacturing base in the United States, low operating costs, and capacity to rapidly scale up supply put it in a favorable position to profit from this market. With $61.3 million in cash and cash equivalents as of Q2 2024 and no debt at the end of the quarter, URG continues to maintain a strong balance sheet. Since 2022, the company has signed six multi-year sales contracts, and management is still aggressively looking to sign more deals. Solid demand for US-sourced items is expected, potentially at a premium over foreign materials.
Ur-Energy is a reputable, low-cost manufacturer with an appeal to US jurisdiction. This means that the Ur-Energy Company has demonstrated its capacity to manufacture uranium at a cheap cost, enabling it to maintain a profit even in the event that uranium prices decline. With an average cost per pound sold of $28 and an average price per pound sold into term contracts of $60.45 over the final two quarters of 2023, the average gross profit per pound sold came to $32.41, with an average gross profit margin of about 54%. Ur-Energy’s U.S. assets are also appealing to consumers looking for dependable domestic uranium sources in the face of supply chain issues, which makes its production even more appealing. This is especially true in light of the current international conflicts affecting Russian uranium supplies.
The operational difficulties that come with scaling up production and outside factors that affect uranium prices and market dynamics are among the risks. Ur-Energy’s potential as a strategic investment in the nuclear energy sector is highlighted by its proactive approach to handling risks and utilization of its operational strengths.
In summary, for investors looking to gain investment in the uranium industry, Ur-Energy is an excellent pick. Ur-Energy has the opportunity to take advantage of the rising demand for nuclear energy due to its sound operations, good financial health, and strategic positioning. This presents significant long-term growth potential in the clean energy industry.
