In Tuesday's IBD Screen of the Day, the focus is on top stocks under $10 that have hit new highs on their Composite Ratings. The most current list has 164 names, including at least two top stocks: digital commerce company Payoneer, which broke out of its cup base this week, and VOC Energy, which is poised to break out from a consolidation base.
Payoneer is a digital commerce company which provides solutions to businesses including payments and cross-border payments. It cleared its buy point of 7.36 on Monday and remained in its buy zone Tuesday. It is trading comfortably above its 50- and 200-day moving averages. Its relative strength line just hit a new high, according to its MarketSmith chart.
The 98 RS Rating has moved up steadily from 32 just three months ago.
The stock sports a 92 Composite Rating. Payoneer's 78 EPS Rating means its recent quarterly and annual earnings growth are outpacing 78% of all stocks.
Top Stock Payoneer To Join S&P SmallCap 600
In August, Payoneer posted second-quarter earnings of 1 cent per share, beating analyst forecasts for a loss of 6 cents, according to FactSet. Revenue of $148.2 million beat estimates of $131.5 million.
The company also raised its revenue outlook for the full year to $580 million to $590 million, from prior guidance of $550 million to $560 million. It plans to announce Q3 earnings Nov. 10.
"This reflects our latest views on the evolving broader macro-economic and geopolitical environment, the diversity of geographies and industries that we serve, and the strength of our operations," Michael Levine, chief financial officer of Payoneer said in the company's news release. "It also includes our improving outlook on our business in Ukraine given the resilience of its people despite the ongoing war, along with the contribution from interest income in a rising rate environment."
Payoneer got a boost last week when it announced it will join the S&P SmallCap 600. The commerce technology company will replace Lantheus Holdings, which will shift to the S&P MidCap 400.
Recent analyst updates have also reflected a positive view on Payoneer.
This month, Goldman Sachs upgraded its price target to $9.50 from $8.50 while maintaining its buy rating. In August, Needham analyst Mayank Tandon wrote in a research note that he remains upbeat on the company "given management's consistently strong execution in rolling out new, high-margin products, adding new customers, and expanding into new, high-growth markets."
Tandon also maintains his buy rating on the stock.
VOC Approaches Buy Point
Meanwhile, VOC stock continues to build its base and is approaching a 8.54 buy point. The oil and gas royalty trust is trading above its 50- and 200-day lines and has a rising relative strength line, although shares fell 2.8% Tuesday.
VOC Energy holds a strong 97 Composite Rating after its Q2 earnings grew 133% above last year's quarter. Its revenue growth is impressive as well, climbing 122% from a year ago.
Follow Michael Molinski on Twitter @IMmolinski
