Overview
The presenter responds to a community request by reviewing five stocks trading under $20 per share (without fractional shares), discussing their merits, risks, and personal views on each, while emphasizing that share price alone should not guide stock selection.
Investing Philosophy and Video Context
- Individual share price should not determine investment choices; focus should be on market cap and fundamentals.
- Low-priced stocks often have lower market caps, higher risk, and more volatility.
- This video covers a mix of relatively safer and riskier speculative stocks, chosen as if forced to buy five under $20.
Stock Picks Under $20
1. Global Self Storage (SELF)
- A small REIT trading under $5 with a $62 million market cap and only 13 properties.
- Operates in a stable, growing self-storage sector with over 10% of US households using such services.
- Consistently high occupancy (>92%) and positive revenue and FFO growth.
- Trades at a valuation 6% cheaper than the sector average and pays a dividend over 5%.
- Potential acquisition target due to sector consolidation, though not currently owned by the presenter.
2. SoFi Technologies (SOFI)
- Fintech platform trading under $20, growing sales and membership rapidly (>50% per year since 2020).
- Diversified offerings in banking, loans, cards, and investments with strong integration and upselling.
- Recently achieved GAAP profitability; valuation remains high (P/E > 50).
- Presenter is a current investor and platform user, citing positive personal and portfolio experience.
3. ADT Inc. (ADT)
- Home security leader trading near $8, with business performing steadily and a strong market position.
- Growth matches overall market, sustaining recurring, high-margin revenues.
- Faces competition from large tech firms but adapts through innovation and partnerships (notably with Google).
- Valuation is significantly lower than historical and sector averages; offers a dividend yield over 2.6%.
4. Recursion Pharmaceuticals (RXRX)
- Highly speculative biotech under $5, down 85% since IPO and lacking market-ready drugs.
- Operates the world’s most powerful biotech supercomputer, partnered with Nvidia, and large health data sets.
- Attracts partnerships (Roche, Merck, Sanofi) and investors but faces substantial bankruptcy risk.
- Price-to-sales ratio is high, but positive news could drive rapid gains.
5. Pfizer (PFE) [Note: Slightly Above $20]
- Global biotech giant trading just above $20 after a >60% post-pandemic decline.
- Remains profitable, with post-pandemic sales and pipeline bolstered by $70+ billion in acquisitions.
- Valuation is over 50% cheaper than peers; high dividend yield exceeds 7%.
- Included despite breaching $20 due to perceived unique opportunity.
Disclosures and Community Engagement
- Presenter encourages viewers to research stocks further and welcomes video topic suggestions.
- Invites feedback and alternative suggestions for stocks under $20 from the audience.