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James Dennin, Kapitall: Here are 6 stocks under 10 bucks that also have low valuations and pay dividends.
As some of our readers have pointed
out, the stock screens we publish with equities all priced below $5 don't always do so well.
Read more from Kapitall: 3 Rallying, Outperforming Stocks with High Employee Ratings
But this is sort of expected. Stocks in this price range are often so volatile that most institutional investors won't even consider them. And while these lists often yield a big winner or two, the gains made by one are rarely enough to yield a well-performing list as a whole.
So we decided to tweak the formula behind our "Deal or No Deal" column a bit. It's still important to us to search for small caps and growth plays that you may not have heard of – but we also wanted to try more ways to weed out some of the duds.
With that in mind I decided to add a couple new screens with longer-term investments in mind. So I raised the price limit to stocks under $10, the limit used by many professional investors. I also added a limit to market capitalization, to make sure I was only looking at companies with a market cap of $100 million or more.
For this screen in particular I added some positive indicators that value investors like because they lend themselves to longer holding periods. These included a positive dividend yield and a low price of profit (forward P/E) below 15.
Dividend yields are particularly useful to consider when you plan on holding stocks for a long time, because you can re-invest your dividend payments, allowing your holdings to gather value faster.
My screen turned up six stocks under 10 dollars.
Click on the interactive chart below to view data over time.
Do you see investing opportunities in any of these moderately priced dividend stocks? Use the list below to begin your own analysis.