A share price under $10 can be an appealing buy for a lot of smaller investors, offering the chance to purchase shares in a company for a smaller total investment. However, all too often low share price also means small market cap and higher risk. That doesn’t mean that there aren’t some large companies with high market caps that still maintain a low share price. Here are five companies that have a market cap over $10 billion and a share price under $10. While there’s no guarantee that these companies are a bargain, they might offer the stability of a large cap company for the price of something much less.
Bank of America (BAC)
So unless one was living under a rock for the last year or so, the troubles at Bank of America must already be well known. However, for all the trouble at Bank of America, there’s still some reason to see the crashing share prices as a buying opportunity. Warren Buffett did, buying up $5 billion in preferred shares in August of last year. With a market cap over $75 billion and a share price of about $7.25, Bank of America certainly provides an intriguing opportunity for anyone willing to risk the bank’s long term financial health.
Xerox Corporation (XRX)
Xerox has fallen off considerably over the last half decade, losing almost half its share value since early 2007. However, the share price of just under $8.75 for a company with a market cap of over $12 billion might catch one’s eye. Throw in a number of other strong valuations, and some might see Xerox as a solid buying opportunity despite the changing marketplace. Xerox features a P/E ratio of 11.80, a PEG of 0.72, a P/S of 0.53, a P/B of 0.92, and a P/FCF of 10.20 (and here’s a previous article for those of you who have no idea what those mean). All told, this gives some reason to believe that Xerox could be looking at brighter days ahead.
Like many of the companies on this list, Japanese company Panasonic has been in a bit of a slide. The company lost almost 40 percent of its share value last year, and is down nearly 60 percent over the last five years. One might look at these numbers and say that Panasonic would be a good stock to stay away from (and they could very well be right), but another interpretation would be that the time is right to get in on the company. With the stock currently trading at just over 5 percent above its 52-week low and with a P/S of 0.19, a forward P/E of 8.02, and a P/B of 0.59, Panasonic might have reason to expect a turn around.
Gerdau S.A. (GGB)
What? You mean you don’t closely track the Brazilian steel industry? Well how does one even respond to that? Well, for those not in the know, Gerdau is a maker of long rolled steel based out of Porto Alegre, Brazil. The company is the largest American producer of long steel with mills operating throughout North and South America for a combined installed capacity of 26 million metric tons per year. With a share price just over $9.50 and a market cap of over $16 billion, Gerdau is a big company being offered at a real discount.
ING Groep (ING)
So the decision about whether or not to invest in a European investment bank is not one that should be taken lightly in this day and age. ING Groep is most likely not exception to this rule with its long-term financial health clearly tied to the ability of the eurozone to work out all of its problems in the long term. However, anyone thinking that Europe’s worst days are behind it should probably give ING a second look. The company’s valuations are strong (PEG of 0.54, P/E of 8.01, P/S of 0.50, P/B of 0.58, and P/C of 1.09) and the share price of just under $9.21 comes despite a market cap exceeding $35 billion.