The Federal Reserve raised benchmark interest rates by 75 basis points in September for the third time in 2022. The Conference Board has estimated a 96% chance of a recession in the United States within the next year. Moreover, the last quarter of 2022 and the first quarter of 2023 are likely to see negative real GDP growth rates.
In addition, Florida State University economist Jerry Parrish predicted last month that a recession will hit the country in the following nine months. He has questioned the Fed's ability to manage inflation without starting a recession.
However, these market uncertainties also offer bargain hunters a chance to buy up on stocks of strong companies at competitive prices. Some financial experts believe that this might be the time to make smart investments.
Given the backdrop, fundamentally sound stocks Rimini Street, Inc. (RMNI), Civeo Corporation (CVEO), Genie Energy Ltd. (GNE), Comcast Corporation (CMCSA), and The Kroger Co. (KR) might be wise buys under $50 right now.
Rimini Street, Inc. (RMNI)
RMNI provides enterprise software products, services, and support for various industries. The company offers software support services for Oracle and SAP enterprise software products.
On August 30, 2022, RMNI announced that Racing and Wagering Western Australia (RWWA), a national leader in racing and wagering entertainment, had switched to RMNI for better, more responsive support and advanced security for its Oracle database and Oracle technology landscape.
On August 2, 2022, RMNI announced that Lotte Mart, a large-scale hypermarket chain in South Korea, had switched to RMNI as its Oracle application maintenance support services provider. These developments underscore the company’s operative capability.
RMNI's revenues came in at $101.20 million for the second quarter that ended June 30, 2022, up 10.5% year-over-year. Its gross profit increased 12% year-over-year to $63.86 million. Also, its net income came in at $0.11 million as compared to a net loss of $4.85 in the previous-year period.
Analysts expect RMNI's revenue to increase 9.6% year-over-year to $445.61 million in 2023. Its EPS is estimated to grow 19% year-over-year to $0.50 in 2023. RMNI's shares have lost 2.2% intraday to close the last trading session at $4.80.
RMNI has an overall A rating, equating to a Strong Buy in our POWR Rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
It has an A grade for Quality and a B for Growth and Value. Within the Software – Application industry, it is ranked #2 out of 146 stocks. Click here to see the additional POWR Ratings for Stability, Sentiment, and Momentum for RMNI.
Civeo Corporation (CVEO)
CVEO provides hospitality services to the natural resource industry in Canada, Australia, and the United States. The company develops lodges, villages, and mobile accommodations.
In August, CVEO announced a renewed share repurchase authorization for the company to repurchase up to 5% of its total common shares outstanding through the facilities of the New York Stock Exchange. This reflects upon its shareholder return ability.
On July 29, 2022, Bradley J. Dodson, Civeo's President and CEO, said, "In the second quarter of 2022, Civeo’s focus remained on operating safely, generating free cash flow and reducing our debt balance.”
CVEO's total revenues came in at $184.95 million for the second quarter that ended June 26, 2022, up 20% year-over-year. Its net income came in at $9.10 million, compared to a loss of $0.47 million in the prior-year period. Moreover, the company’s EPS came in at $0.54, compared to a loss per share of $0.03 in the same period the prior year.
Street expects CVEO's revenue to increase 11.9% year-over-year to $664.99 million in 2022. Its EPS is estimated to grow 15% per annum for the next five years. Over the past nine months, the stock has gained 36.7% to close the last trading session at $27.22.
CVEO's strong fundamentals are reflected in its POWR Ratings. The stock has an overall A rating, which equates to a Strong Buy in our POWR Rating system.
It has an A grade for Growth and Sentiment and a B for Stability, Quality, and Value. CVEO is ranked first among 44 stocks in the B-rated, Outsourcing - Business Services industry. Click here to see the additional POWR Ratings for CVEO (Momentum).
Genie Energy Ltd. (GNE)
GNE supplies electricity and natural gas to residential and small business customers internationally. It operates in three segments: Genie Retail Energy (GRE); GRE International; and Genie Renewables.
On September 20, 2022, Genie Renewables (GREW), a division of GNE, announced its ownership of site rights to solar generation projects with an aggregate of 64 MW in New York and Pennsylvania. The project is expected to help the company create long-term shareholder value.
GNE's gross profit came in at $67.47 million for the second quarter that ended June 30, 2022, up 218.2% year-over-year. Its net income increased 578.3% year-over-year to $33.90 million. Also, its EPS increased 584.2% year-over-year to $1.30.
Over the past nine months, the stock has gained 61.8% to close the last trading session at $8.77.
GNE has an overall A rating, which equates to a Strong Buy in our POWR Rating system. It has an A grade for Value and Momentum and a B for Quality. GNE is ranked first among 66 stocks in the Utilities - Domestic industry. Click here to see the additional POWR Ratings for GNE (Stability, Growth, and Sentiment).
Comcast Corporation (CMCSA)
CMCSA operates as a media and technology company worldwide. It operates through Cable Communications; Media; Studios; Theme Parks; and Sky segments.
On October 5, 2022, CMCSA announced its plans to offer free and discounted internet in New Jersey Internet options through the federal government's Affordable Connectivity Program (ACP).
On the same day, CMCSA reported the Grand Opening of its new Xfinity store in Beaverton, Oregon. Jacob Mitchell, Comcast Oregon/SW Washington’s Vice President of Sales and Marketing, said, “A new, exciting physical location for our customers to come in and hear about our products is the right investment to make.”
CMCSA's revenue came in at $30.02 billion for the second quarter that ended June 30, 2022, up 5.1% year-over-year. Its adjusted EBITDA increased 10.1% year-over-year to $9.83 billion. Moreover, the company’s adjusted net income came in at $4.51 billion, up 14.3% year-over-year.
Analysts expect CMCSA's revenue to increase 4.5% year-over-year to $121.57 billion in 2022. Its EPS is estimated to increase 11.1% year-over-year to $3.59 in 2022. It has surpassed EPS estimates in all four trailing quarters. CMCSA's shares have lost marginally intraday to close the last trading session at $30.05.
CMCSA has an overall rating of B, which equates to a Buy in our POWR Rating system.
CMCSA has a B grade in Value and Quality. Within the Entertainment - TV & Internet Providers industry, it is ranked first among nine stocks. Click here to see the additional POWR Ratings for Sentiment, Stability, Growth, and Momentum for CMCSA.
The Kroger Co. (KR)
KR operates as a retailer in the United States. The company operates combination food and drug stores, multi-department stores, marketplace stores, and price-impact warehouses.
On September 16, 2022, KR announced the official opening of a new spoke in Birmingham, Alabama. The spoke is expected to operate as a seamless extension of the regional fulfillment center in Atlanta. The expansion should drive the company’s revenue while increasing its market penetration.
KR's sales came in at $34.64 billion for the second quarter that ended August 13, 2022, up 9.3% year-over-year. Its net income increased 56.5% year-over-year to $731 million. Also, its EPS increased 63.9% year-over-year to $1.
Analysts expect KR's revenue to increase 7.6% year-over-year to $148.40 billion in 2023. Its EPS is estimated to increase 10.3% year-over-year to $4.06 in 2023. It has surpassed EPS estimates in all four trailing quarters. Over the past year, the stock has gained 10.5% to close the last trading session at $43.72.
KR has an overall rating of A, which equates to a Strong Buy in our POWR Rating system. It has a B for Growth, Value, and Quality.
KR is ranked #7 out of 38 stocks in the A-rated Grocery/Big Box Retailers industry. Click here to see the additional POWR Ratings for KR (Stability, Sentiment, and Momentum).
RMNI shares were trading at $4.63 per share on Friday afternoon, down $0.17 (-3.54%). Year-to-date, RMNI has declined -22.45%, versus a -22.46% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
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