Sometimes it's a mistake to judge a stock merely by the size of its price tag. There may very well be a good reason for a stock being out of favor or just not pinging on Mr. Market's radar. The risks are going to be greater with those trading for less than $5, but the same can also be said about the potential rewards. 

Pandora Media (NYSE:P), Glu Mobile (NASDAQ:GLUU), and Blue Apron (NYSE:APRN) are three names that are currently trading in the low single digits. Two of them have fallen out of favor, and one nearly doubled in 2017, but there are catalysts in play that could send all three stocks higher in 2018. Let's go over why they may be among the top stocks under $5. 

A family pieces together a Blue Apron meal kit.

Image source: Blue Apron.

Pandora Media 

It's rough to be a shareholder of the streaming music pioneer. Pandora reportedly rebuffed a buyout offer at $15 two summers ago, and now it's trading for less than a third of that price. The problem here is that Pandora was too early for one revolution but, unfortunately, too late for the other. Pandora was streaming music long before the mobile revolution made the niche cool, but now the hot trend is for premium on-demand offerings and Pandora is falling behind Spotify and tech giants with heady ambitions. 

The good news for investors is that Pandora isn't a third of the company it was when satellite radio reportedly came knocking in 2016. It continues to command a huge audience, and while the crowd is thinning out, it's doing so gradually. Most companies would love to have the 73.7 million active listeners consuming more than 5 billion hours of quarterly content that Pandora is serving.

Pandora still managed to grow its ad revenue slightly in its latest quarter, and the number of premium subscribers is inching higher since diving into the on-demand market last year. Whether Pandora gets bought out or gains traction with its evolving product line, it could bounce back in 2018.

Glu Mobile

The one stock in this group that had a monster 2017 was Glu Mobile. Shares of the mobile game publisher soared 88% last year, and they're trading higher so far in 2018. Glu Mobile became a market darling briefly in the summer of 2014 when Kim Kardashian: Hollywood raced up the app charts, and last year's big hit was home-decorating simulator Design Home.

Tastes can be fleeting in this niche, but we've seen Glu Mobile's full-year revenue guidance grow from between $215 million and $225 million to as high as $314.2 million as 2017 played out. Sustaining the positive momentum won't be easy. Taylor Swift-backed The Swift Life rolled out late last year, and download metrics show it isn't living up to the hype. However, Glu Mobile's pipeline is full of releases that will be swinging for the fences. 

Blue Apron

It was easy to take shots at Blue Apron last year. The best-known meal-kit provider went public seven months ago at $10, and it has shed more than two-thirds of its value. The arrival of big-name competition, weak retention trends, and a slump in sales doomed Blue Apron to the island of broken IPOs. 

Everyone seems to hate Blue Apron, but that could also set the stage for a turnaround of its stock price in 2018. The brand remains valuable for potential acquirers wanting a bigger footprint in this niche. It can also go the other way and become an acquirer to take advantage of its expanded production facility. The next few quarterly reports will be ugly, but analysts see sales picking back up again in the latter half of this year. Blue Apron burned investors last year, but if it does bottom out in the coming months, there's a lot of upside to the depressed stock price.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.