FRD - Investing $1500 in These 3 Stocks Would Be a Smart Move

The Dow Jones Industrial Average and S&P 500 futures inched slightly higher today as investors remain optimistic about the continued economic recovery as COVID-19 cases decline in the United States. Moreover, the Federal Reserve’s recent indication of no immediate removal of monetary stimulus has boosted investors’ confidence.

Also, as investors bet that the Chinese authorities will not allow real estate developer Evergrande Group to fail, the major indices are expected to remain upbeat in the near term.

Given this backdrop, if one has $1,500 in disposable cash we think one should consider investing in TransGlobe Energy Corporation (TGA), Educational Development Corporation (EDUC), and Friedman Industries, Incorporated (FRD). These stocks possess robust growth attributes and are expected to continue gaining.

TransGlobe Energy Corporation (TGA)

Headquartered in Calgary, Canada, TGA is a cash-flow-focused international oil and gas company. Its current activities are concentrated in the Arab Republic of Egypt and Alberta, Canada. The company also holds interests in four production sharing concessions: Gharib, West Bakr, NW Gharib, and South Ghazalat, Egypt.

TGA’s revenue increased 334.7% year-over-year to $50.63 million for the second quarter, ended June 30, 2021. The company’s net earnings came in at $7.72 million, versus a $13.37 million net loss  in the prior-year quarter. Its EPS amounted to $0.11 for the quarter, compared to a $0.19 loss per share in the second quarter of 2020. Also, the company’s cash and cash equivalents grew 26.5% from $34.51 million as of December 31, 2020, to $43.64 million as of June 30, 2021.

A $145.77 million consensus revenue estimate for its fiscal period ending December 2021 represents a 27.1% increase year-over-year. Its EPS is expected to grow 363.2% next year. Furthermore, the company has an impressive earnings surprise history; it beat the consensus EPS estimates in three of the trailing four quarters. TGA’s stock has soared 104% in price over the past nine months and 415% over the past year.

TGA’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall A rating, which equates to a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.

Also, the stock has an A grade for Momentum and Quality, and a B grade for Growth. We’ve also graded TGA for Stability, Sentiment, and Value. Click here to access all TGA’s ratings. TGA is ranked #2 of 50 stocks in the A-rated Foreign Oil & Gas industry.

Educational Development Corporation (EDUC)

EDUC is a children’s books publishing company that operates through publishing and the home business division. The Tulsa, Okla.-based company’s books are sold nationwide through independent consultants, and its retail division markets books to bookstores, toy stores, specialty stores, museums, and other retail outlets throughout the country.

During its fiscal first quarter ended May 31, 2021, EDUC’s net revenues increased 6.6% year-over-year to $40.81 million. The company’s net earnings grew 78% from their year-ago value to $3.44 million. Its EPS rose 78.3% from the prior-year quarter to $0.41. Also, the company’s EBIT increased 76.3% year-over-year to $4.66 million. EDUC’s stock has gained 4% in price over the past month.

EDUC’s POWR Ratings reflect this promising outlook. The stock has an overall A rating, which equates to a Strong Buy in our proprietary rating system. Also, the stock has a B grade for Quality, Sentiment, and Growth.

In addition to the POWR Rating grades I’ve just highlighted, one can see EDUC’s ratings for Value, Stability, and Momentum here. The stock is ranked #1 of 11 stocks in the A-rated Entertainment – Publishing industry.

Friedman Industries, Incorporated (FRD)

Incorporated in 1996, FRD in Longview, Tex., is a provider of steel products and steel processors. It operates in two segments—the Flat Roll Division, and the Tubular Division. The company serves railroad transportation, steel buildings, containers & tanks, OEMs, steel & pipeline distributors, and other industries.

FRD’s net sales increased 180.2% year-over-year to $65.92 million for its  fiscal first quarter, ended June 30, 2021. The company’s net earnings came in at $11.31 million, compared to a $858,000 net loss in the prior-year quarter. Its EPS amounted to $1.64, compared to a $0.12 loss per share in its  fiscal first quarter of 2020. Also, the company’s EBIT came in at $14.27 million, versus a  $14 million loss before income tax in the prior-year period. FRD’s stock has surged 73.1% in price over the past nine months and 105.4% over the past year.

It’s no surprise that FRD has an overall A rating, which equates to a Strong Buy in our POWR Rating system. Also, the stock has an A grade for Growth, Value, and Momentum.

Click here to see the additional POWR Ratings for FRD (Quality, Stability, and Sentiment). FRD is ranked #10 of 33 stocks in the A-rated Steel industry.

TGA shares were trading at $2.06 per share on Monday afternoon, down $0.00 (0.00%). Year-to-date, TGA has gained 114.27%, versus a 19.55% rise in the benchmark S&P 500 index during the same period.

About the Author: Priyanka Mandal

Priyanka is a passionate investment analyst and financial journalist. After earning a master's degree in economics, her interest in financial markets motivated her to begin her career in investment research.

More...