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7 ‘Buy’ Rated Stocks Trading Under $10

Who says you need to spend a fortune to get a decent stock? In this volatile economy, there are lots of stocks priced under $10 a share that analysts are recommending to buy. Our list includes two banks, two discount airlines, two technology companies and an energy company. Let’s see who is buying these hidden gems:

FAIRHOLME (FAIRX) Bruce Berkowitz

Bank of America Corp (BAC) has a mean recommendation of 2.3 on a scale where 1.0 indicates a strong buy and 5.0 a sell. BAC is currently trading at $6.62 a share. It has a $67.49 billion market cap and offers a 0.60% dividend yield. BAC is down more than 52% for the year. Bruce Berkowitz keeps over 8.4% of his Fairholme (FAIRX) fund invested in BAC, after increasing his position in the bank by 8% during the second quarter 2011 (check out Bruce Berkowitz’s top picks).

Southwest Airlines Co. (LUV) gets a mean 2.2 on a scale of 1.0 (Strong Buy) to 5.0 (Sell). It recently traded at $8.36 a share. LUV has a market cap of $6.71 billion and a P/E ratio of 12.62. LUV offers a dividend yield of 0.22%. LUV is down over 37% YTD. Paul Reeder and Edward Shapiro, the managers for Par Capital Management, are bullish about LUV. They may have decreased Par Capital’s position in the company by 56% last quarter, but they still left more than $147 million in the company, or approximately 6% of the Par Capital fund portfolio (see more of Paul Reeder and Edward Shapiro’s favorite stocks).

TiVo, Inc. (TIVO) is rated a buy at 2.1. It is currently trading at $9.90 a share. TIVO has a market cap of $1.2 billion and P/E ratio of 25.37. TIVO is up 14.48% YTD. Stuart Peterson is a fan of TIVO. His Artis Capital Management has a position worth over $99 million in the company after increasing his holding by 75% during the second quarter 2011. The stake represents over 4.5% of the Artis Capital portfolio.

SandRidge Energy, Inc. (SD) is rated at 2.0. SD recently traded at $6.57 a share. It has a market cap of $2.72 billion. SD is down nearly 11% for the year. Ex-oilman turned hedge fund manager T. Boone Pickens is bullish on SD. It is his BP Capital fund’s sixth largest position at its current value of $20.8 million (see what else T. Boone Pickens likes).

Delta Airlines, Inc. (DAL) is rated a buy at 1.9 on scale of 1.0 (Strong Buy) to 5.0 (Sell). It recently traded at $8.43 a share. DAL has a market cap of $7.13 billion and a P/E ratio of 27.35. DAL is down almost 35% for the year. Several fund managers are bullish about this airline, including John Griffin. He bought a new position in the company for his Blue Ridge Capital fund during the second quarter 2011. It was valued at over $113 million at the end of June and represented 1.71% of the Blue Ridge Capital portfolio.

Lloyds Banking Group Plc (LYG) gets a 1.5 mean recommendation on a scale of 1.0 to 5.0, where 1.0 indicates a strong buy and 5.0 a sell. Lloyds last traded at $2.25 a share. It has a market cap of $47.67 billion. LYG is down approximately 46% so far this year. Fund manager David Costen Haley is a fan of LYG. He increased his HBK Investments fund’s position in LYG by 31% in the second quarter, bringing his position to a value over $870,000 (check out David Costen Haley’s other top picks)

Panasonic Corp (PC) is currently rated as a strong buy, with a mean recommendation of 1.0 on a 1.0 to 5.0 scale where 1.0 is a strong buy and 5.0 means sell. It is currently trading at $9.73 a share and has a market cap of $22.50 billion. PC also offers a dividend yield of 0.61%. PC is down just over 32% for the year. Jim Simons has over $21.3 million of his Renaissance Technologies fund invested in PC (see billionaire Jim Simons’ favorite picks).

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