In doing my usual research over the weekend, I came across two cheap $2 tech stocks that most investors probably have never heard of and have had some challenging times recently. The first selection has been hit hard after missing earnings estimates each of the last two quarters. The second pick has been impacted by the weakness in flat panel sales. Both are extremely cheap by most valuation metrics and are still growing revenues and analysts expects sales growth for both to acclerate in FY2013. For aggressive investors, they merit consideration at these price levels.
"Multiband Corporation (MBND) provides contract installation services; voice, data, and video services; and design, engineering, and construction services in the United States." (Business description from Yahoo Finance)
4 reasons MBND is a good value at just over $2 a share:
- The stock is cheap at under 7 times forward earnings and just 14% over book value. The company has grown revenues at better than 50% annual clip over the past five years and sells for a five year projected of less than 1 (.79).
- Several insiders have been picking up shares since mid-September. MBND also sells at the bottom of its five year valuation range based on P/S, P/B and P/CF.
- Only two analysts follow the stock. Both have a $4 price target on the stock, roughly double the current price of the stock.
- The stock has recently bounced off long term technical support and stock was trading at $3.50 earlier in the year (See Chart).
Four reasons HIMX is a solid speculative play at $2 a share:
- Only two analysts that cover the stock have price targets of $3 and $4 a share, both substantially higher than the current price.
- The company has over $40mm of net cash on its balance sheet (over 10% of market capitalization) and yields a solid 3.2%.
- The stock is cheap at just 84% of book value and less than six times forward earnings.
- HIMX has a minuscule five year projected PEG (.40). The company is on track to post over 15% sales growth in FY2012 and analysts expect close to 25% revenue growth in FY2013.