DBD’s sub-$2 shares price the firm at only 1.3X forward earnings, making it one of the cheapest firms on the entire U.S. Still, the 84% collapse in Diebold’s stock price in 2022 will likely prove transient. In November, the firm revealed that revenue from its banking products segment declined by a stunning 15.4% in constant-dollar terms from the prior year. And supply chain issues have dented ATM and other banking revenues. A decline in the euro’s value shaved off $76.3 million in revenue during Q3 2022. Of course, DBD shares trade at a significant discount. It could ship as many as 134,000 point-of-sale terminals in 2023. The firm also has growth potential from its self-checkout machine business and electric vehicle charging stations. Diebold’s management plans to ship 60,000 ATMs and 35,000 self-checkout units in the coming year, up from prior-year figures of 52,000 and 25,000 units, respectively. The company has generated positive cash flow in all but four years since 1987, and its recent string of losses has more to do with depreciation and amortization charges than with significant operational losses.ĭiebold Nixdorf (NYSE: DBD) also has a strong backlog, with 80% of its 2023 product revenue already fulfilled. The maker of ATMs and currency processing systems runs a surprisingly stable franchise. Although these penny stocks have a better-than-average chance of success, not all, obviously, will perform. That’s why investors need to carefully consider these stocks for both their positives and negatives. And promising startups like Lidar firm Quanergy (OTCMKTS: QNGYQ) would falter after its moonshot bets failed to pay off. Storied brands from L’Occitane to Revlon (OTCMKTS: REVRQ) have ended up bankrupt after taking on too much debt. Of course, not every firm with these elements will succeed. Firms working on “moonshot” technologies with the potential to dominate markets. Companies with solid underlying performance or valuable brand assets. Top scorers are then analyzed from a bottom-up perspective. To narrow down the search for companies that could rise 500% in 2023, I first run my quantitative Profit & Protection system on all stocks below $5. Though earnings estimates may prove too high, investors have far more room for things to go wrong in 2023 than with growth stocks, which are trading at 2019-level valuations. And markets are pricing cyclical consumer stocks such as Beazer Homes (NYSE: BZH) at 3.2X forward P/E. Energy firms including CONSOL Energy (NYSE: CEIX) and Northern Oil and Gas (NYSE: NOG) now trade for less than 3 times forward earnings. According to data from Thomson Reuters, the median penny stock (defined as stocks trading under $5) now has a forward P/E ratio of only 9.8X, compared to 12X a year ago.Īmong cyclical firms, the pattern is even stronger. Investing in 2023: A Divergence of Winners and Losersįortunately, 2023 is shaping up to be a promising year for cheaper stocks. Penny stocks face such long odds of success, so we need enormous winners to offset the hundreds of other duds. These are firms with “special sauce,” often some advanced technology or strong product. When you’re investing in penny stocks, it’s the average profit that’s the focus, not your hit rate.Īnd that’s why it’s important to tilt the odds in your favor by focusing on stocks with the fundamental potential to go 2X… 5X… even 10X. My other three picks went nowhere, and plenty of my other Moonshot picks since have done the same. Of course, these penny stocks are still laced with risk. On average, the portfolio did double in value, and then some. And energy services firm Enservco (NYSE: ENSV) would jump 180% by the following March after Russia’s invasion of Ukraine. Shares of biotech firm Longeveron (NASDAQ: LGVN) would skyrocket 800% that month after receiving a Rare Pediatric Disease (RPD) designation for a key drug. Nevertheless, my five-stock portfolio did land winners.
0 kommentar(er)
