11 Undervalued Stocks for Less Than $50 in April 2024

Neuroscience-focused biotechnology firm Pasithea Therapeutics Corp. (KTTA) tops the list of undervalued non-penny stocks that trade below $50 per share for April 2024, with a price-to-book ratio of only 0.38.

Value investors look to the price-to-book ratio as a key measure of whether a company is undervalued compared to other stocks within its industry or sector. In this article, we examine companies across sectors with the lowest price-to-book ratios for April 2024. In our screen we include stocks listed on the New York Stock Exchange (NYSE) or the Nasdaq that trade for under $50 and that have a positive one-year trailing total return. We do not include penny stocks in our screen.

The data below are as of April 7, 2024.

• Price-to-book ratio: 0.38
• Price: $8.50
• Market capitalization: $8.9 million
• Sector: Healthcare
• 1-Year total return: 9.0%

Pasithea is a biotechnology firm developing treatments for central nervous system disorders. Since February, the company has sought enrollment for clinical trials of its PAS-004, a potential treatment for neurofibromatosis type 1.

• Price-to-book ratio: 0.40
• Price: $34.06
• Market capitalization: $2.1 billion
• Sector: Communication services
• 1-Year total return: 12.5%

Joyy is a Singaporean social media company that provides platform services, such as Bigo Live for livestreaming, Hago for social networking, Likee for videos, and more. Although Bigo’s revenue climbed by 3.1% year-over-year for the fourth quarter of 2023, companywide net revenue declined by about 6% to $569.8 million for that period.

• Price-to-book ratio: 0.45
• Price: $13.53
• Market capitalization: $62.6 million
• Sector: Industrials (transportation)
• 1-Year total return: 32.2%

TOP Ships is a Greek shipping company that owns a fleet of eco tanker vessels used for the global transportation of crude oil, petroleum products, and bulk liquid chemicals.

• Price-to-book ratio: 0.49
• Price: $7.04
• Market capitalization: $138.4 million
• Sector: Consumer discretionary
• 1-Year total return: 18.5%

Motorcar Parts manufactures, remakes, and distributes aftermarket automotive parts for passenger vehicles, light trucks, and heavy-duty vehicles. In February, the company announced additional product offerings for its Quality-Built brake pad and brake rotor program. More than 20 new part numbers cover an additional 7 million vehicles in operation.

• Price-to-book ratio: 0.52
• Price: $7.38
• Market capitalization: $168.9 million
• Sector: Financials
• 1-Year total return: 21.7%

Security National Financial is a financial company providing life insurance products, funeral and cemetery/mortuary services, and mortgage services. For the full-year 2023, after-tax earnings from operations decreased by 44% relative to the prior year, while revenues declined by 18%. For 2023, the company reported a loss of more than $17 million for its mortgages business.

• Price-to-book ratio: 0.67
• Price: $55.77
• Market capitalization: $401.5 million
• Sector: Consumer staples
• 1-Year total return: 9.0%

Seneca Foods is a fruit and vegetable processing company that is primarily involved in food packaging. The company sources its produce from approximately 1,400 farms across the U.S.

• Price-to-book ratio: 0.73
• Price: $10.10
• Market capitalization: $131.0 million
• Sector: Information technology
• 1-Year total return: 2.6%

Universal Electronics is a technology firm that designs, develops, and sells wireless universal control solutions for home entertainment and smart home devices. For the full year 2023, the company reported net sales of $420.5 million, compared with $542.8 million for the prior year.

• Price-to-book ratio: 0.75
• Price: $13.42
• Market capitalization: $483.4 million
• Sector: Real estate
• 1-Year total return: 119.6%

Landsea Homes is a residential homebuilding firm that develops master-planned communities in the northeastern part of the U.S. and California.

• Price-to-book ratio: 0.79
• Price: $8.23
• Market capitalization: $856.2 million
• Sector: Materials
• 1-Year total return: 11.2%

Algoma is a Canadian producer of hot and cold rolled steel products. It serves customers throughout North America. The company’s most recent dividend of $0.05 per common share was paid in late March.

• Price-to-book ratio: 0.87
• Price: $8.69
• Market capitalization: $663.3 million
• Sector: Energy
• 1-Year total return: 6.0%

Berry is an independent upstream energy company engaging in exploration and production, well servicing, and abandonment services. The company primarily focuses on reserves in the western U.S. On April 5, Berry completed the acquisition of hot runner injection and high-volume compression molding company F&S Tool Inc. for an undisclosed sum.

• Price-to-book ratio: 1.43
• Price: $16.81
• Market capitalization: $35.9 billion
• Sector: Utilities
• 1-Year total return: 1.4%

Pacific Gas & Electric is a holding company providing utility services for customers across northern and central California through its subsidiary.

How We Selected Undervalued Stocks

In screening for undervalued stocks, we included firms listed on either the NYSE or the Nasdaq trading between $5 and $50 per share and that had positive total returns over the prior 12-month period. We then ranked those firms by the lowest price-to-book ratio, determined by dividing market price per share by book value per share for each company. We then selected the top company in each GICS sector.

Value investors use price-to-book ratio as a way of gauging whether a stock is undervalued compared to its peers and the wider market. Companies with price-to-book ratios lower than 1 are often thought to be undervalued. Price-to-earnings ratio is another key metric often used in making this determination.

Value investors aim to buy stocks trading below their actual values in order to see gains when those stocks later rise in value when the market corrects the price gap. This investing strategy can be an accessible one for many investors, particularly with firms trading at under $50 per share. Fortunately, many online brokers make it easy to search for undervalued stocks using these and other metrics.

Still, there are risks associated with value investing. Using just a single metric, such as price-to-book ratio, provides a helpful but incomplete picture of whether a stock is undervalued or overvalued. Further, there is no guarantee of whether the market will correct the price of an undervalued stock or when that correction may occur.

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As of the date this article was written, the author does not own any of the above stocks.