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3 Growth Stocks Under $5 I’d Buy Today

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If you don’t want to break the bank investing and are looking for stocks that have a lot of room to grow in share price, then looking at low-priced stocks could be a great way to accomplish that. Below are three stocks that are under $5 but that have terrific potential to grow.

Roots Corp (TSX:ROOT) is trading at over $4 a share and really hasn’t had the success that may have been expected of the clothing apparel company, especially given how well Canada Goose Holdings Inc has done since listing on the TSX.

It’s been a little more than a year now that Roots started trading on the TSX, and its share price has dropped significantly since then, losing around 60% of its value.

While the company has struggled to turn a profit, there haven’t been big alarm bells that should have sent investor into a panic, although the stock took a deep dive after releasing its Q2 results that showed little growth.

Trading below book value and at a price-to-earnings multiple of just 11, Roots is a very good value buy that could achieve a lot more growth. Canada Goose is proof that Canadian-branded clothing has appeal in other parts of the world.

Westport Fuel Systems Inc (TSX:WPRT)(NASDAQ:WPRT) is trading near $3 per share, and year to date it has struggled as well, dropping by 40%. While like Roots, it has struggled with profitability, in recent quarters Westport has come closer to breaking even.

The appeal of the company is its focus on low-emission engines and fuel systems that could have a lot of potential in the future as many countries around the world look for cleaner and more efficient options for their vehicles.

It may take some time to see that growth, however, as Westport saw its sales rise by just 8% in its most recent quarter. Last year, the company’s top line increased by less than 10% as well, and investors may have been hoping for more progress by now.

But with a price-to-book ratio of less than four and the stock having a market cap of less than $400 million, it’s still a fairly low-priced stock. Westport looks to be one big development or one big customer away from its share price taking off.

The Green Organic Dutchman Holdings Ltd (TSX:TGOD) was off to a flying start early in the year when it appeared poised to be the next big pot stock. However, things have changed significantly since then as its share price is now 15% lower than when it first started trading on the TSX.

The hype around cannabis-infused beverages has seemed to calm down and investors have sold off the gains they’ve achieved on pot stocks like Green Organic. It’s an interesting trend that we’ve seen that after legalization many investors started selling their holdings in cannabis, perhaps in expectation that the industry would fall short of expectations.

However, at over $3, Green Organic is a cheap buy that could soar once we see more movement on cannabis beverages. We haven’t seen many deals between beverage makers and cannabis stocks, and once that starts up again, we could see a lot more excitement around this stock.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor David Jagielski has no position in any of the stocks mentioned.

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