While most of Wall Street focuses on large-cap and mega-cap stocks, as they provide a degree of safety and liquidity, many investors are limited in the number of shares they can buy. Many of the biggest public companies, especially the technology giants, trade in the hundreds, all the way up to over $1,000 per share or more. At those steep prices, it is difficult to get any decent share count leverage.
Many investors, especially more aggressive traders, look at lower-priced stocks as a way not only to make some good money but to get a higher share count. That can really help the decision-making process, especially when you are on to a winner, as you can always sell half and keep half.
Goldman Sachs is the premier investment bank in the world, so we screened its outstanding research database and found five stocks trading under the $10 level that could provide investors with upside potential ranging from over 125% to 400%. For those leery of low-priced shares, just remember that Amazon and Apple at one time traded in the single digits. Zynga, a stock we have featured over the years, recently was purchased by Take-Two Interactive Software.
While all five are rated Buy at Goldman Sachs, they are much better suited for very aggressive investors. It also is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Farfetch
This stock traded in the $50s a year ago and now has a huge upside. Farfetch Ltd. ( NYSE: FTCH ) provides an online marketplace for luxury fashion goods in the United States, the United Kingdom and elsewhere.
Besides operating Farfetch.com, an online marketplace, and the Farfetch app for retailers and brands, the company also offers web design, build, development and retail distribution solutions for retailers and brands. As of December 31, 2021, operated two Browns retail stores; two Stadium Goods retail stores; and 12 New Guards Off-White stores, three Ambush stores, two Palm Angels stores and three Off-White outlets. In addition, it operates approximately 60 New Guards franchised retail stores and four seasonal stores under various brands.
The $45 Goldman Sachs target price is well above the $30.58 consensus target. The shares closed on Friday at $7.86, so hitting the Goldman Sachs target would be a 475% or so gain.
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Kronos Bio
This microcap biotech may be the biggest winner of all the Goldman Sachs Buy-rated stocks under $10. Kronos Bio Inc. (NASDAQ: KRON) is a clinical-stage biopharmaceutical company focused on the discovery and development of novel cancer therapeutics.
The company's product engine focuses on dysregulated transcription factors and the transcriptional regulatory networks that drive oncogenic activity. Its lead product candidate is entospletinib, which is an orally administered, selective spleen tyrosine kinase inhibitor for acute myeloid leukemia patients.
The company’s planned registrational Phase 3 clinical trial of entospletinib in combination with induction chemotherapy in acute myeloid leukemia patients with NPM1 mutations. It is also developing KB-0742, an orally bioavailable inhibitor of cyclin-dependent kinase 9 for the treatment of MYC-amplified solid tumors, which is in Phase 1/2 clinical trial.
Goldman Sachs has set a price target of $35 per share, and the consensus target is even higher at $40.25. Hitting the Goldman Sachs target would be a more than 800% gain from the recent friday share price close of $3.81.
Lyell Immunopharma
This microcap biotech also could be a huge home run aggressive traders. Lyell Immunopharma (NASDAQ: LYEL) is a T cell reprogramming company engaged in developing T cell therapies for patients with solid tumors.
The company develops therapies using technology platforms, such as Gen-R, an ex vivo genetic reprogramming technology to overcome T cell exhaustion, and Epi-R, an ex vivo epigenetic reprogramming technology to generate a population of T cells with durable stemness.
Lyell Immunopharma’s pipeline includes LYL797, a T cell product candidate for the treatment of non-small cell lung cancer and triple negative breast cancers; LYL845 for multiple solid tumors; and NY-ESO-1 for synovial sarcoma and other solid tumor indications.
The Goldman Sachs price target is $21, while the consensus target is $22. The shares closed trading at $4.11 on Friday, hitting the Goldman Sachs target would be a gain of about 450%.
Taysha Gene Therapies
This company went public in 2020 and was trading close to $30 a share before it was clobbered. Taysha Gene Therapies Inc. (NASDAQ: TSHA) focuses on developing and commercializing adeno-associated virus-based gene therapies for the treatment of monogenic diseases of the central nervous system, including the following:
TSHA-120 for the treatment of giant axonal neuropathy TSHA-102 for the treatment of Rett syndrome TSHA-121 for the treatment of CLN1 disease TSHA-118 for the treatment of CLN1 disease TSHA-105 for the treatment of SLC13A5 deficiency TSHA-101 for the treatment of GM2 gangliosidosis
Goldman Sachs has a $27 target price. The $25.50 consensus target is also well above the final share price of $2.77 seen on Friday. The Goldman Sachs target represents about a 790% gain.
ALSO READ: Goldman Sachs Has 6 ‘Strong Buy’ Dividend Stocks That Can Weather a Certain Coming Recession
Zevia PBC
This is another micro-cap idea with incredible upside potential. Zevia PBC (NYSE: ZVIA) is a beverage company that develops, markets, sells and distributes various carbonated and non-carbonated soft drinks in the United States and Canada.
Its products include soda, energy drinks, organic tea, mixers, kidz beverages and sparkling water under the Zevia brand name. The company offers its products through various retail channels, including grocery distributors, national retailers, warehouse club and natural products retailers, as well as e-commerce channels.
The company is focused on addressing the global health challenges resulting from excess sugar consumption by offering a broad portfolio of zero sugar, zero calorie, naturally sweetened beverages. All Zevia beverages are made with a handful of simple, plant-based ingredients, contain no artificial sweeteners and are Non-GMO Project verified, gluten-free, Kosher, vegan and zero sodium.
The $14 price target at Goldman Sachs compares with an $11.27 consensus target and Friday's closing share price of $1.99. Hitting the Goldman Sachs target would be a 550% gain.
These are five stocks for aggressive investors looking to get share count leverage on companies that have sizable upside potential. While not suited for all investors, they are not penny stocks with absolutely no track record or liquidity, and major Wall Street firms have research coverage.
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