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15 Cheap Dividend Stocks Under $15

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25.09.2020

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Many investors look at expensive stocks like Amazon.com (AMZN) or Google parent Alphabet (GOOGL), and they wonder why they should bother with an investment so pricey they can only buy one or two shares. Instead, they target cheap stocks they can buy for just $20, $15, $10 … or even less.

However, it's important to remember that one share worth $1,000 is really the same as 1,000 shares at $1 – it's just sliced up differently.

Still, it's undeniable that many investors simply aren't interested in shares that trade for hundreds or even thousands of dollars. That's particularly true for income-oriented investors, who see plenty of high-priced stocks like Amazon that don't even pay a penny in dividends.

If you're looking for cheap dividend stocks and frustrated by the lack of options, check out the following list of 15 picks under $15. All are cheap dividend stocks that offer 3% yields or better at current prices, and have a decent amount of potential despite their relatively low profiles.

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Founded in 1895, South Africa-based DRDGold (DRD, $11.72) is a mining company that focuses on gold "tailings" businesses in the region. Tailings are minerals that exist in small amounts across other ores or even in otherwise useless rocks unearthed in the mining process, and require rather unconventional means of extraction. These include pulverizing the mining materials into powders and chemical processes that concentrate minerals and draw them out.

Clearly, this is a specialized business and not the normal old way of digging for gold. But it's a consistently profitable business for DRD nevertheless. That's particularly true in 2020, as gold prices are up 23% year-to-date, to $1,867 per ounce, and at one point reached $2,070 per ounce – driving DRDGold's shares 129% higher.

The yield, at 3%, is on the low end for these cheap dividend stocks, but still well above the 1.8% average on the S&P 500. Just note that the dividend is variable – it sometimes is paid only once a year, sometimes more, and the amount tends to change depending on profitability. But the stock, and the income potential, should continue to be good as long as gold prices remain elevated.

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United Microelectronics (UMC, $4.29) is a semiconductor wafer "foundry" that operates internationally but mainly in Asian markets including Taiwan, Singapore and China. Unlike many of the higher-profile companies that make their own branded chips, UMC is content to be the factory for semiconductors rather than research new cutting-edge designs and applications.

There are admittedly much lower margins in creating someone else's hardware. However, UMC makes up for these margins with a broad customer base that includes electronics companies but also fast-growing solar energy and LED industries. And back in July, when semiconductor giant Intel (INTC) hinted it might exit chip manufacturing altogether and just stick to designs, firms including United Microelectronics surged higher on the promise of winning more business in the future.

UMC is still one of the cheapest dividend stocks on this list, on a per-share basis, despite trading at roughly double its 52-week low. It also pays a generous dividend for the tech space. But like DRD, it's based on a variable dividend – one that's paid out only once a year, no less.

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Rather than creating the hottest new social app or creativity suites, American Software (AMSWA, $13.79) is a lesser-known IT firm that creates supply chain management and enterprise software solutions. It operates via subsidiaries Logility, Demand Solutions, NGC Software and The Proven Method.

2020 has been an up-and-down year for AMSWA shares, which are off 7% year-to-date.

Still, William Blair sees hope in the company's recently reported fiscal first-quarter earnings, which saw subscription revenues gain 43% year-over-year to $200,000, and adjusted profits hit 9 cents per share to easily beat estimates.

"With regard to the pipeline, management stated that the total dollar value, number of transactions, and average size of transactions are trending positively and that in the last few weeks, sales activity has increased," note William Blair's analysts, which rate AMSWA at Outperform (equivalent of Buy). "In addition, there are more seven-figure deals in the pipeline than ever before."

AMSWA's dividend has remained level at 11 cents per share for years, but that currently translates into a 3%-plus yield that puts it on this list of cheap dividend........

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