Just because there is low-priced inventory does not mean its value. Stocks trading below US$5 do not have growth characteristics or represent value opportunities, and the value of this stock is not high. However, when you find stocks that do have growth potential in this price range, it is worth considering. Below are two such stocks, both of which are trading at $5 or less per share, and they are expected to soar this year and beyond.
LiveXLive: The leader in streaming content
A cheap stock to watch is LiveXLive media (Nasdaq stock code: LIVX). In the past year, the stock has soared about 147%, and so far this year has risen by about 24%. LiveXLive provides a platform for live and on-demand digital audio, video and podcasting. The platform can be accessed via the Internet or via a smartphone via the LiveXLive mobile application, and it also allows users to create their own custom music stations.
Like other competitors, LiveXLive offers free access levels supported by ads, as well as subscription services that do not include ads. About 53% of the company’s revenue comes from subscriptions, 39% of advertising and sponsorship, and 8% of pay-per-view concerts.
In the quarter ended September 30 (the second quarter of fiscal 2021), LiveXLive’s revenue increased by 52% year-on-year to $14.6 million, which was the company’s tenth consecutive record quarter. In addition, contribution gross profit (including income after fixed expenses) jumped from 11.8% to 29.3%. The number of subscribers has increased by 21%, and the current revenue is more than 1 million, which has promoted the growth of revenue. Both subscription and advertising revenues were boosted by LiveXLive’s booming live broadcast business.
LiveXLive has established a good niche relationship between artists and fans through events, interviews, album listening parties, podcasts, etc. In the past two quarters, LiveXLive has broadcast 103 concerts and other events, including Pitbull, Darius Rucker, K-Pop band Monsta X, Billy Joel, Billie Eilish and Bon Jovi, etc., and has received more than 95 million views frequency. In the same period last year, the company only streamed 22 events, generating more than 60 million views. During the pandemic, live concerts are rapidly accelerating as people seek alternative ways to participate in live performances. Since January 2020, the company has broadcast live broadcasts of more than 1,500 artists in various formats.
In addition, LiveXLive’s pay-per-view service was launched in May 2020 and has generated 8% of total revenue in just six months, and since live concerts are still dormant, it is expected to achieve a strong future increase.
The company expects revenue for fiscal 2021 to be between US$63.5 million and US$69.5 million, with an annualized contribution rate of 30% to 35%, and operating losses between US$2.5 million and US$5 million. This is a decrease from the operating loss of $7.1 million in the previous quarter. Although the company is currently unprofitable, as it continues to generate revenue, improve its profit margins and cash position, and place itself in the hands of CEO Rob Ellin (who owns approximately 20% of the issued shares) At the forefront, this situation should appear. Turn to live broadcast and will continue after COVID. ”
WisdomTree Investment: Growth through ETF
Wisdom Tree Investment (Nasdaq stock code: WETF) Is an asset management company specializing in exchange-traded funds (ETF). The company has nearly 70 different ETFs for every imaginable investment method and strategy, including domestic, international, emerging market and ESG equity, as well as fixed income, alternatives, asset allocation and themes. It manages US$68.7 billion in assets, including approximately US$40 billion in US ETFs and US$28 billion in international ETFs.
The company performed well in 2020, with a return on stock of 14%. Assets under management increased by approximately 8% during the calendar year, and adjusted net income increased by 3.7% year-on-year to 11 million U.S. dollars. The company’s operating profit margin is 23%.
WisdomTree is not only an ETF expert, but also an innovator in using proprietary methods to create customized, transparent ETFs based on earnings and dividends, including factors such as seeking “modern alpha” (which is a term for the company’s alternative weighting and active management). Try to beat the passive ETF strategy. Many of these innovative ETFs have outperformed the market and are among the best in their class, and as ETFs become more and more popular in the next ten years, they should be able to continue WisdomTree’s success.
Although ETF is the sole focus of WisdomTree, it is a niche market that is expected to continue to grow.Analyst’s report at the end of 2019 Bank of America It is estimated that by 2030 ETF assets will grow to US$50 trillion. The current assets are about 5 trillion US dollars.
Keep in mind that these are small stocks and usually take higher risks. However, both LiveXLive and WisdomTree Investments seem to be expected to continue to grow.