By Nancy Zambell of InvestorPlace

Unless you've been living under a rock, by now you know that August was characterized by a spate of merger and buyout action across Wall Street -- particularly in the tech sector. That's because corporations are sitting on a boatload of cash and equity prices are relatively depressed, making the time ripe for a takeover or acquisition.

As we enter September after the Labor Day weekend, many investors are rolling up their sleeves and getting into the business of buying, too. If the first few trading months are any indication, we could have a nice rally ahead of us.

So how can you share in the action? A good place to start is to look at affordable stocks that not only have low share prices but also strong outlooks that make them likely targets for significant gains. After all, it's hard to believe that Apple ( AAPL) will double from $250 a share to $500. But a stock that's at $5 or $7? Well, a double doesn't seem that impossible.

Here are five affordable targets that make great acquisitions for investors in September.

Cheap Stock #1 - Activision

Activision Blizzard ( ATVI) is the cream-of-the-crop when it comes to video game stocks. Last year, four of the top 10 best-selling video games in the world belonged to ATVI, including Guitar Hero on Tour, the number one title in dollars on the Nintendo DS, and its Guitar Hero III: Legends of Rock version was the first video game to ever pass $1 billion in sales from just a single title! I expect the company to continue its torrid growth in 2010 -- especially as folks find themselves spending less money on outside entertainment and more time at home in this recession. Activision has record sales and earnings, consistently beating analysts' estimates, and $3 billion in cash with no debt. That gives Activision incredible room to grow.

Cheap Stock #2 - Ballantyne Strong

Ballantyne Strong ( BTN) is a leader in the transition to digital and 3-D, and also finds itself handsomely profiting as the transition takes hold across the industry. The company is expected to be integral to the digital transition for both Regal Entertainment ( RGC) and Cinemark Holdings ( CNK). Digital products have already grown to 39% of the company's sales, up from 23% at the end of 2008. But digital is just in its infancy. The expansion of the industry will create breathtaking profitability opportunities for BTN. It's also worth noting that less than 30% of its shares are held by institutions, but the company has just received coverage from one Wall Street analyst, with anticipation of another on his heels, so attention is coming to the stock.  

Cheap Stock #3 - Education Realty Trust

Education Realty Trust ( EDR), created as a REIT in 2004, is one of the largest owners and operators of collegiate student housing in the United States. This makes it a stable but potentially lucrative investment, with 65 properties in 21 states. First, due to SEC regulations for real estate investment trusts, EDR returns a hefty portion of its profits via dividends -- a 2.9% yield as of this writing. Secondly, the numbers show a big upside for shares. According to the U.S. Labor Department, college enrollment hit an all-time high last year, with more than 70% of high school graduates opting for college rather than trying their luck in a recession-heavy economy. But the big upside of Education Realty Trust is that the profits don't rely on student loans like shady for-profit education stocks that have been in the news in recent months. The majority of the company's revenues (86.9%) are derived from its student housing leasing. EDR's preleasing is 3.1% ahead of last year at this time, and net rental rates are 1.9% ahead of last year. Those numbers point to future growth and make this stock a good buy.

Cheap Stock #4 - Craft Brewers

Founded in 1981, but already the eighth-largest U.S. brewer based on domestic shipments, Craft Brewers Alliance ( HOOK) offers craft beers under the Widmer Brothers Beers, Redhook Beers, Kona Brewing and Goose Island brand names to restaurants, bars and liquor stores. The simple pleasure of a great brew is one of the few expenses consumers are stomaching these days, and thanks to strong earnings report at the beginning of the month HOOK has been on a tear lately with a +48% gain since Aug. 1! HOOK caught the eye of Anheuser-Busch InBev ( BUD) -- owner of Budweiser -- which now owns 36% of the company and is its distributor. That has paid big dividends and allowed HOOK to expand rapidly, which it continues to do.

Cheap Stock #5 - Exide

Exide Technologies ( XIDE) is one of the world's largest producers, distributors and recyclers of lead-acid batteries, which account for about one-half of the rechargeable battery market. The company also produces lithium ion batteries via the company's 2008 acquisition of the principal assets of the Canadian company Mountain Power. Its total production capacity is some 1.5 million batteries annually. Exide has recently received some very favorable attention from Wall Street, with Wedbush Morgan's initiation of coverage, with an outperform rating, as well as Thomas Weisel Partners' upgrade to overweight. I think we will see more of this kind of attention as the renewable energy sector heats up, and I think Exide will be the stock to own as the push for alternative energy vehicles results in funding from federal and state coffers -- not consumers. Trading at one-half what it's worth, the company's shares are on the move so buy now.