While we tend to spend most of our time looking at and discussing large-cap stocks, it would be a big mistake to ignore the potential of small and mid-cap stocks.
Small-cap stocks have higher risk because the companies tend to be very young and have yet to prove they can navigate the growing pains that every new company must overcome. Mid-cap stocks, on the other hand, have already dealt with a lot initial hurdles of growing a business and can put their focus more on the future as opposed to the present.
Mid-cap stocks are those that trade with a market between $2 billion and $10 billion, and those are the stocks we want to take a closer look at this week. Here are 4 mid-cap stocks that are trading under $30 that deserve a closer look.
Juniper Networks (JNPR)
Juniper Networks (JNPR) is a mid-cap stock with a current market cap of $9.5 billion. The company makes communication equipment, and the stock has traded sideways for the last four months, currently sitting at $27.37. Juniper has shown earnings growth of 7% per annum over the last five years, and looking ahead analysts expect to see earnings rise at an annual rate of 13.2% over the next five years. The stock is attractively priced with a forward P/E of 13.7 which supports a lot of upside potential should the company manage to consistently hit its estimates moving forward. The company has a good earnings track record with positive earnings surprises in each of the last five quarters. Analysts have an average price target of $27.54 on the stock, but the targets will revise upward if the company is able to extend its streak of positive earnings surprises when it next reports earnings on April 25.
JNPR gets an overall score of 57 on the Stock Score Report.
Under Armour (UAA)
Athletic apparel and accessories company Under Armour (UAA) has a market cap of just over $9 billion. Under Armour took a big hit in December with the overall market, but the stock rebounded strong at the start of the year, and was helped by better than expected top and bottom line Q4 numbers in February. The company continues to grow at a blistering pace, with profits up 22% per annum over the last five years and profits are forecast to rise at an annual rate of 37% over the next five years. The stock is a little expensive with a forward P/E of 44, but Wall Street has already traded the stock at a high valuation, and the valuation should not keep the stock from rising if the company is able to keep pace with the strong growth estimates analysts have set. UAA is currently trading at $21.56 and analysts have an average price target of $21.89 on the stock.
UAA gets an overall score of 53 on the Stock Score Report.
Western Union (WU)
Western Union (WU) is in the money transfer business. The stock has a market cap of $8.3 billion, and after hitting a 52-week low of $16.42 in December the stock has rebounded nicely to $19.20. The company’s earnings growth is weaker than we like to see, but positive. Profits are up 6.2% per annum over the last five years, and are expected to climb just under 3% annually over the next five years unless its quarterly numbers are consistently better than expected. The valuation is low with a forward P/E of just 9.6, which given the modest earnings growth estimates prices the stock reasonably. The company will report its next set of quarterly numbers on May 9 and analysts have an average price target of $19.72 on the stock.
WU gets an overall score of 54 on the Stock Score Report.
Brown & Brown (BRO)
Brown & Brown (BRO) is an insurance broker. The stock has a market cap of $8.4 billion and is currently trading in the upper end of its 52-week range at $29.75. BRO sold off in the final months of 2018 with the overall market but started to recover in January and is currently testing a solid resistance level at $30. If the stock is able to break through the $30 barrier it should extend its recent gains to a new all-time high which is currently $31.55. The company has shown solid earnings growth of 10.2 percent per annum over the last five years and analysts expect a slightly higher annual growth rate of 12% for the next five years. The valuation remains reasonable with a forward P/E of 20, and analysts have an average price target of $28.71 on the stock. BRO will next report earnings on April 22.
BRO gets an overall score of 63 on the Stock Score Report.