The $100 per share price point is a magical threshold for many investors and companies. Stocks priced below that amount are considered affordable while those above it are “expensive.” It is why when many companies announce a stock split the ratio applied is typically sufficient to get the shares below $100.
For example, Chipotle Mexican Grill (NYSE:CMG) trades at over $3,100 per share. Its shareholders just approved a 50-to-1 stock split, one of the largest splits in the history of the New York Stock Exchange. When completed, CMG stock will trade for around $63 a share.
Chipotle could have split its stock 2-to-1, 3-to-1 or even 10-to-1 but it wouldn’t have been enough. Even at 20-to-1, Chipotle stock would still trade for more than $150 a stub. It is a psychological barrier that companies feel the need to break through. Yet whether Chipotle Mexican Grill costs $3,100 or $63, it is still a great stock to own. It is not the price that matters but the business underlying that is important.
Maybe you can’t afford a stock costing thousands of dollars and don’t have access to a brokerage that will let you buy fractional shares. That’s okay. There are still plenty of stocks over $100 to buy that will make great investments without breaking the bank.
TJX Companies (TJX)
Off-price retailer TJX Companies (NYSE:TJX) is a great place to start your hunt for excellent stocks over $100 to buy. The owner of TJ Maxx, Marshalls, HomeGoods and more, has a long history of market outperformance, even during a recession. Perhaps especially during recessions.
Helping consumers get great deals on name brand products has been the hallmark of TJX business. Through all types of business and economic cycles, the retailer has maintained a steady upward trajectory. Since its 1989 initial public offering, TJX gave investors a total return of 30,610% versus just 3,000% for the S&P 500. The change in stock price alone generated 18,000% returns for investors.
TJX Companies stock goes for around $107 per share and though its valuation is slightly elevated compared to historical norms, it remains one of the stocks over $100 to buy. The retailer continues to see rising sales, profits and margins. As the economy becomes more difficult, consumers looking for a bargain while trying to look good will return again and again to its retail banners.
RTX (RTX)
RTX (NYSE:RTX) is the second-largest defense contractor producing much of the U.S. military’s missile defense systems. Among its many platforms, RTX is responsible for the Patriot missile system, Stinger and Javelin missiles, high-speed, anti-radiation missiles (HARMS) and national surface-to-air missile systems (NASAMS).
Like death and taxes, the reality is that war will always be with us. Yet as President Theodore Roosevelt once said, “speak softly and carry a big stick.” RTX is a big part of the U.S. military’s “big stick.” Preparedness ensures wars needn’t be fought on U.S. soil.
The defense contractor generated $19.2 billion in Q1 sales, a 12% increase. GAAP profits soared 32% to $1.32 per share. Adjusted earnings rose 10% to $1.34 per share. The future looks just as strong. RTX President and COO Chris Calio said, “We’re operating in one of the strongest demand periods in our history with a record $202 billion backlog.”
The war in Ukraine certainly fuels a lot of the demand for RTX weapons systems. During the quarter it booked $282 million for NASAMS for Ukraine. But the military contractor also booked $1.6 billion for Patriot systems for Germany, $818 million for Patriot-guided enhance missiles (GEM-T) for NATO and another $874 million for various international GEM-T orders.
I’ve long expected RTX stock to hit an inflection point because of all the global hot spots that erupted over the last four years. Shares have more than doubled in that time frame, and trade at $108 today. Yet RTX stock is up over 50% since just last October. War is big business and RTX is one of the biggest to benefit from it.
Axcelis Technologies (ACLS)
The third stock over $100 to buy is Axcelis Technologies (NASDAQ:ACLS), a manufacturer of ion implantation systems that are critical to the chip-making process. As the complexity of computer chips has grown, the number of implant steps increased with it. Implantation is a form of introducing impurities into a semiconductor to its electrical, optical and structural properties.
Axcelis is the second-largest provider of implantation systems behind Applied Materials (NASDAQ:AMAT) and has a 28% share of the market. It is the only company offering a broad range of equipment for the process. It is the fastest-growing one in the field.
Where Axcelis Technologies stock had been trading at $111 per share recently, Bank of America upgraded its price target to $125 and the stock immediately took off to meet the new target. The consensus view on Wall Street has a one-year price target of $146 per share, implying an additional 16% upside in the stock.
President and CEO Russell Low said Axcelis was “off to a good start in 2024” after posting first-quarter results as the tech stock’s products “continue to win business from new customers globally.” It makes the tech equipment leader an excellent stock over $100 to buy.
On the date of publication, Rich Duprey held a LONG position in RTX stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.