You can't get much for $5 anymore. But some promising stocks carry price tags of $5 or less, and despite their low share prices, some of them have already put in impressive performances. In particular, ImmunoGen (IMGN), Zynga (ZNGA), and Diana Shipping (DSX 0.69%) have all produced good gains in 2017 despite costing less than a fiver per share. Many investors believe that these stocks could have further to run, and so now might be your last chance to get in at current price levels.
ImmunoGen makes a splash
ImmunoGen has been a big winner so far in 2017, more than doubling yet still carrying a price of just over $4.50 per share. The biotechnology company has had a lot of success with its antibody-drug conjugates in treating various forms of cancer, and positive data from clinical trials have stoked greater interest in the stock this year. Anticipation of data releases led investors to get an early start in pushing ImmunoGen higher in late February, but the real moves higher came in the spring months.
In particular, ImmunoGen released two sets of data in May related to its mirvetuximab soravtansine candidate treatment. One study looked at the treatment as a monotherapy for fighting ovarian cancer, and phase 1 response rates were extremely encouraging. The second looked at the treatment in combination with other companies' drugs and came to similarly positive conclusions. With a pipeline that has plenty of other interesting candidate treatments, ImmunoGen looks like it might just be ramping up toward further gains.
Image source: Zynga.
Zynga gets a win
Zynga's gains haven't been as strong as ImmunoGen's, but they've come in a shorter time. The mobile game specialist has climbed by more than half since 2017 began, and almost all of those gains have materialized since the beginning of May.
The rise for Zynga began with favorable financial results, in which the company said that it limited its losses to just $0.01 per share and saw strong gains from its Zynga Poker game platform. The move comes amid a strategic shift for Zynga toward online multiplayer gaming and other less costly alternatives to full-fledged new title releases. Analysts liked the move, and general enthusiasm throughout the video gaming category has helped lift Zynga along with its peers. As mobile gaming continues to pick up steam and device capabilities improve, Zynga will have an even bigger opportunity to make the most of rising demand and its valuable experience in the industry, and that could lead to further gains from a share price that's still less than $4.
Diana is shipping it
Finally, Diana Shipping has managed to climb by about a third in 2017, with its stock moving just above the $4 per share mark recently. Favorable quarterly results in May helped provide much of the lift for the shipping company, as Diana brought in more revenue and managed to cut its losses from year-ago levels.
Looking more broadly at the company, Diana has been willing to commit resources toward growing its fleet, anticipating better overall global economic conditions that should contribute to a recovery in the shipping industry from a long downturn in recent years. The need to raise capital has led to brief downdrafts for Diana's share price, as have ongoing fluctuations in the Baltic Dry Index. Yet if trading activity does pick up in the years to come after a long dry spell, then Diana has put itself in a good position to reap the benefits.
Share prices below $5 don't automatically mean that a stock is cheap, because what really matters are the underlying fundamentals for a company's business. However, these three companies have seen big gains because of expectations of favorable times ahead, and that could bode well for Diana Shipping, Zynga, and ImmunoGen going forward.
