These days we talk about money in the billions and even trillions, numbers we really cannot conceive of in a practical sense. On the other end of the scale is the hundreds, a number most people easily understand. So when it comes to investing what can we do with $500? It doesn’t seem like much, especially in the stock market, but if you know where to look there are many opportunities to put that seemingly small amount of money to work. Here are five $5 stocks worth taking a look at as the year gets underway.
1. Pier 1 Imports
A once very popular company, Pier 1 (NYSE:PIR) has fallen out of favor over the past few years. It’s hard to muster up any enthusiasm for a stock that has lost 90% of its value in the last 5 years. The major culprit connected with this price plunge has been e-commerce. Though this virtual reality has hit many retail businesses it bashed Pier 1 because their target audience was average homeowners whose financial position was the middle of the road. In short, there was nothing to separate them from the online competition.
So why Pier 1? They have announced an interesting plan that covers 3 years and will take on the online competition in an omni-channel strategy. Will the plan work? Well, that is why it is on this list. But with the long term housing recovery comes the continuing demand for Pier 1’s major product lines. It also seems to have learned a valuable lesson: it is watching online searches for its brand. Those numbers have been scaling upward, and some analysts see the stock rising to $8 a share.
Speaking of online businesses, Groupon (NASDAQ:GRPN) has seen its share of online struggles recently. They were once a thing but now are apparently fading into no-thing. But people always will be coupon clippers, and like Pier 1 there will always be an underlying interest in what they have to offer. That interest has been increasing of late, with a 2% global popularity evident making it at the very least interesting. It has cut its overhead costs, always a good thing. But the real reason is it is likely ownership will put it up for sale, and a projected buyer’s price is about $12 a share.
We switch to the defense sector, and we’re not talking Boing here. The company (NASDAQ:ARTX) is benefitting from a hot defense sector, the result of the election of Donald Trump back in 2016. Either Arotech missed the boat or there is something that is lying underneath the company that has yet to catch fire. For new investors, this company is a lesson in basic stock analysis. A stagnant profit will result in a stagnant stock price. In the case of Arotech, there are signs of turning its profits around indicated by a slight bump in its dividend of $0.17 per share. Investing in this stock is really a matter of simply watching its profit and declared dividend.
4. Blink Charging
As much as Arotech is simply watching its dividend and profit numbers, Blink Charging (NASDAQ:BLNK) is on the other end of the spectrum. This is a volatile stock that if you decide to invest in can take you for a roller coaster ride. But what is a stock without risk? The past year has seen its stock price go from $30 a share to $5, then recover from $5 to $15. The stock’s volatility is as simple as its business sector: electric vehicle charging stations. If the company’s strategy of creating a global network of stations pans out, it will be $500 (or more) well-invested. If not, well at least you will have some losses to balance out your gains.
Gamers are very familiar with this company (NASDAQ:ZNGA) which is in what can be described mildly as a very competitive industry. Some analysts say that Zynga overreached when trying to compete with the sports games generally played on X-boxes and the like. The result was a download stock spiral that significantly hurt company profit margins. It learned its lesson and is now back to focusing on mobile app games, with some successful numbers generated. One of those numbers is an increase in mobile active daily users, meaning gamers are back to paying attention. Whether this is a trend or a plateau will determine the company’s future profit and stock price.