Stocks Under $10: 3 to Buy, 2 to Avoid

Investing in stocks priced under $10 can offer significant upside potential for investors seeking high returns on a modest budget. These low-priced stocks, often tied to emerging or recovering companies, can yield substantial gains if their growth trajectories align with market opportunities. 

However, the low price often reflects inherent risks, such as financial instability, poor fundamentals, or high volatility. Many such stocks are speculative, with unproven business models or shaky balance sheets, making them prone to sharp declines. Thin trading volumes can amplify price swings, increasing the potential for sizable losses. Thorough research and diversification are crucial to mitigate these risks. 

The following five stocks include three under $10 that offer compelling value and growth prospects, backed by strong fundamentals or market potential, and two to avoid due to persistent challenges or weak performance.

Stock to Buy No. 1: Joby Aviation (JOBY)

Trading around $9 per share, Joby Aviation (NYSE:JOBY) is a compelling under-$10 stock with growth potential. The electric vertical takeoff and landing (eVTOL) pioneer is advancing urban air mobility, backed by a $100 million investment from SK Ecoplant. Recent analyst upgrades, like H.C. Wainwright’s $13 target,implying 44% upside, reflects optimism about its FAA certification progress and Trump administration support for air travel innovation. 

With a market cap of $7.1 billion, JOBY’s scalability in a nascent industry offers significant upside, though risks include regulatory delays. For investors, its low entry point and disruptive potential make it a buy, especially if monitored for milestone updates.

Stock to Buy No. 2: Arcos Dorados (ARCO)

Arcos Dorados (NYSE:ARCO), priced at about $7.50 per share, is a solid under-$10 pick as the largest McDonald’s (NYSE:MCD) franchisee in Latin America. Its stable revenue from over 2,300 restaurants, coupled with a 3.2% dividend yield, provides income and growth. Expansion into digital ordering and delivery, along with a recovering Latin American economy, drives optimism.

Analysts see a $12 per share one-year price target, citing its undervaluation, such as trading at less than 12 times earnings. Risks include currency fluctuations, but its brand strength and regional dominance make ARCO a good deal for patient investors seeking steady gains.

Stock to Buy No. 3: IAMGOLD Corporation (IAG)

Gold miner Iamgold (NYSE:IAG) trades near $7.40 per share and offers growth potential in the precious metal sector. Its Cote gold mine in Ontario, bolstered by a $1.05 billion royalty deal with Franco-Nevada (NYSE:FNV), positions it for production growth. 

Analyst upgrades, like National Bank’s “strong buy” rating, highlight rising gold prices and operational improvements. With a market cap of $811 million, IAG’s low price reflects past struggles, but Cote’s potential to become the world’s third-largest gold mine and Iamgold’s exploration upside make it attractive. Risks include gold price volatility, yet it’s a buy for those diversifying into metals with a long-term view.

Stock to Avoid No. 1: Coursera (COUR)

Coursera (NYSE:COUR), hovering around $8.50, is a stock to avoid despite its edtech appeal. Growth has stalled, with declining enrollments and a stock essentially treading water this year due to competition from free platforms. Revenue growth slowed to 6% in the first quarter, and its $1.4 billion market cap hides a lack of profitability. Risks include oversaturation and reliance on corporate clients, making it vulnerable to economic downturns. Investors should steer clear unless evidence of a significant turnaround emerges.

Stock to Avoid No. 2: Peloton Interactive (PTON)

Home connected fitness stock Peloton Interactive (NASDAQ:PTON) is the second under-$10 stock to avoid. Trading around $7.30 per share, PTON’s fitness empire has faltered, with a 16% stock decline in 2025 amid declining subscriptions (down 6% in the fiscal third quarter) and high debt and operating lease obligations (some $1.4 billion). Sales fell 13%, reflecting post-pandemic demand drops.

Its $2.9 billion market cap masks operational inefficiencies, while competition from cheaper fitness options adds pressure. Rather than starting a lasting trend, Peloton tapped into a very niche market, and the risk of further losses outweighs its low price, making it a risky bet for all but the most speculative investors.

The post Stocks Under $10: 3 to Buy, 2 to Avoid appeared first on 24/7 Wall St..