Some people think investing in stocks requires a substantial amount of start-up capital. But even small and regular investments can go a long way. That's especially so right now as some excellent companies look pretty cheap on a price basis. With $25, investors can acquire shares of promising stocks.
Here are two companies, Exelixis (EXEL 1.26%) and Adyen (ADYE.Y 3.24%), with shares changing hands for less than that right now. Let's look a bit deeper into these companies' businesses.
1. Exelixis
Exelixis is a mid-cap biotech company. What makes it exceptional is that it has managed to become a leader in a small niche of the oncology market. Cancer is one of the largest, most competitive therapeutic areas in biotech, attracting many of the biggest names in the industry. Still, thanks to its crown jewel Cabometyx, Exelixis is a leader in the treatment of some forms of kidney and liver cancers.
Exelixis generates most of its money from Cabometyx, whose sales generally increase as new indications are approved. In 2022, the biotech's revenue increased by about 12% year over year to $1.6 billion. While the company's reliance on Cabometyx could become a problem, its future largely depends on its approach to developing cancer medicines.
The company is seeking to replicate the success it has had with Cabometyx by targeting several forms of cancer in which there are unmet needs. Exelixis is currently running a pair of phase 3 clinical trials for its most advanced non-Cabometyx candidate, zanzalintinib, in targeting advanced renal cell carcinoma (the most common type of kidney cancer) and metastatic colorectal cancer.
Here's what both diseases have in common: When caught early, they are highly treatable, but their five-year survival rates drop substantially once they metastasize. Exelixis has several other candidates in early stage studies. It is also seeking new indications for Cabometyx, which is undergoing dozens of clinical trials.
Recently, the biotech announced a $550 million share repurchase program that lifted its stock price. However, Exelixis' stock remains down by 13% in the past year, and its shares are changing hands for just under $19 as of this writing. Given that Cabometyx is still going strong and the company has a knack for developing cancer medicines, investors should consider buying shares of Exelixis -- just like the company itself is doing right now.
2. Adyen
Based in the Netherlands, Adyen is a fintech company that has managed to attract the business of many top multinational corporations, including eBay, Spotify, Microsoft, and Uber, among others. What makes Adyen so successful is that it offers its customers solutions that facilitate payment processing across online and brick-and-mortar stores, various payment methods, and multiple countries, as well as risk management solutions, all in a single integrated platform.
Adyen's financial results are susceptible to economic challenges. Issues such as inflation that cause investors to rein in their spending could lead to lower processed volume and revenue for the company. Last year, Adyen's business was also impacted by the war in Ukraine. The fintech specialist generates much of its revenue from its European operations. Still, Adyen has managed to perform well.
In the second half of 2022, the company processed 421.7 billion euros ($458.4 billion) in payment volume, which increased by 41% year over year. Adyen's net revenue jumped by 30% year over year to 721.7 million euros ($784.5 million), and its net earnings per share of 9.08 euros ($9.9) came in 5% higher than the comparable period of the previous fiscal year. Adyen's bottom-line growth was not as impressive as its top line, primarily due to increased expenses. For instance, Adyen's wages and salaries costs nearly doubled for the year.
The fintech company is ramping up investments for the future. While the money it is putting back into the business today may be hurting the bottom line, long-term investors should take notice. Within the company's unified commerce payment solutions, a key aspect of its growth, it still sees plenty of room to grow in the U.S., where it generates less than half of its revenue. Also, in the second half of 2022, the company launched this service in Japan and Mexico, an example of its continued expansion into new regions.
Adyen still has plenty of opportunities to tap into the rapidly growing fintech industry, especially as e-commerce increasingly gains market share over brick-and-mortar retail sales worldwide. Adyen is solidly poised to benefit, given its existing position in the market and the company's focus on long-term growth. With its shares trading for just $15.57, now is a great time to initiate a position.
