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In loads of previous Seeking Alpha articles I have warned against the allure of the low-priced stock. I am not, however, a blanket statement kind of guy. At day's end, so many sub-$5 jobbers dot the universe that you're going to find some winners here and there. Heck, Amazon.com (AMZN) debuted at $1.50 and got pumped all the way past $100, only to fall back down into low-priced territory before rising again.

In this article, I discuss my thoughts on several sub-$5 stocks, along with ways you can play them (or not). In some instances, I offer options trades that help decrease your exposure.

Speculative Buy: Nokia (NOK). The other day, I logged into my DRIP (Dividend Reinvestment Plan) account for the first time in a while. I keep this one on auto-pilot in long-term heritage stocks so I choose to, for the most part, ignore it. I am glad, however, that I checked in.

I noticed that I have a small position in NOK, left over from 1999-2000. Thankfully, I sold a majority of the position back then, leaving me with only a few leftover shares.

This discovery coincided with NOK hitting my radar screen. I am an AT&T (T) customer, who owns a Blackberry, but I am now eligible to upgrade one of my lines. I also just purchased a new Sony (SNE) Vaio laptop. When it arrived, I realized I should have waited a few months for the release of Microsoft's (MSFT) Windows 8.

It should be quite clear to most Windows' users that Microsoft has been "stealing," for want of a better word (maybe "borrowing?"), from Apple (AAPL) for years.

I owned a Macbook several years ago, but gave it up and shifted back to a Windows laptop. It was incredibly frustrating to not be able to drag and drop as frequently and effectively on Windows as you could using a Mac. Fast forward to today and, at some level, there's little distinction between the two. Skip ahead to tomorrow and Windows 8 promises to make a splash with touchscreen features and inclusion not only on computers, but tablets and, possibly, smartphones.

All of this hype, much of it generated by Nokia's marketing campaign, caught my eye. Last weekend, I tried to upgrade to a Lumia, but they were sold out at AT&T. Yesterday, I had one in my cart, but thought twice about spending $142 to give my life away to AT&T for more than two more years.

No matter how it all shakes out, Nokia has something Research in Motion (RIMM) does not in its battle for number three behind Apple and Android - a well-heeled, innovative backer that's coming back from hibernation at the right time. Between the two companies, Nokia represents the safer play, as its aggressive move into the smartphone market via Lumia appears to hold promise for the future. Nokia is not dead, despite its swooning stock price.

Now, I am not going all-in with NOK; instead, I will just send a $50 check to my DRIP each month. Given the price of the stock and the fact that Nokia, for now, pays a dividend, I should be able to accumulate a halfway decent size position over the next year or two as the stock continues to flounder and/or stay range-bound. NOK has long-term and highly speculative written all over it.

Turnaround Play: Wendy's (WEN). While speculative, I do not consider Wendy's quite as risky as Nokia. That said, it's still a risk and not for the faint of heart. I have written somewhat extensively on the stock for Seeking Alpha. While it's disappointing to see WEN unable to sustain above $5.00, I'm not too concerned.

Wall Street wants to see results. It does not simply want to hear about a multi-year turnaround plan. I see this two ways.

One, as a long-term investor, you can accumulate a solid, but not overwhelmingly large, position in what might just be the next Domino's (DPZ). Two, you might see some near-term upside if Wendy's reports strong sales and progress in its makeover throughout the year.

With that in mind, I would allocate 80% of a speculative kitty into the common stock, which pays a small dividend, and the remainder into WEN January 2013 call options.

Sell: Sirius XM (SIRI). This one is pretty straightforward. This stock rises and falls on noise. Debt upgrades. Rumors of buybacks. Takeover talk. A relatively meaningless FCC filing. Howard Stern losing a lawsuit. Most of this stuff has very little, if anything, to do with the long-term viability of satellite radio, a medium that looks more like the dog days of AM Radio than anything else.

Sirius XM reports earnings before the market May 1. As I am not a big fan of playing stocks, particularly with a directional bet, prior to earnings, I will have my eye on SIRI January 2013 $2.50 puts shortly after the open on May 1st. If SIRI breaches $2.00, there's not much of a floor until $1.83 followed by $1.70, $1.65 and $1.45.

If we hear more of the same from CEO Mel Karmazin on the call - dashboard penetration, free cash flow, returning capital to shareholders - expect the market to turn on the stock once again. Sirius XM runs in an innovative, hyper-growth industry - new media - yet it fails to act with even an ounce of innovation and aggression.

Coming in my next X stocks under $5 article: Radio Shack (RSH). (That's not a joke).

Source: 3 Stocks Under $5 To Consider