3 dirt cheap stocks to buy under $5

Credit: Benny

It was a shaky start to 2016, but local shares are well and truly back on top.

What’s more, although the potential headwinds facing the economy are no secret, the share market is still expected to climb even higher.

The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) is currently sitting at around 5,400 points, up from a low of just 4,706 in February. By year’s end, however, Credit Suisse thinks the index can still crack the 6,000-point mark!

If you’ve read this far, you’re probably wondering what are some of the best shares you could buy to grow your wealth alongside it…

Together with their ability to continue growing strongly, these three companies also possess qualities that could provide them with protection if the economy does take a turn for the worst.

Shares of each of these businesses were trading for less than $5 at the time of writing.

Burson Group Ltd (ASX: BAP) is the name of the first company.

Soon to be called “Bapcor”, Burson Group is an automotive aftermarket parts distributor, providing various parts to mechanics for the repair and servicing of automotive vehicles (predominantly those that are four years or older).

Burson Group’s shares trade for $4.92, but could have further to run as the company expands its store count and benefits from its scalability.

Somnomed Limited (ASX: SOM) shares trade for $3.04 and could also have further to run in the coming years.

It provides a treatment for sleep-related breathing disorders, including sleep apnea and snoring. The treatment is much less invasive than treatments that are provided by its various rivals.

Sleep apnea is a potentially serious condition. As such, treatment when diagnosed is often necessary, even during times of economic uncertainty.

iSentia Group Ltd (ASX: ISD) provides media monitoring services to some of the world’s biggest companies, and is quickly expanding into the Asian market.

It’s a vital service for many businesses to ensure they know what is being said about them, when and by whom. As such, most businesses would be inclined to continue paying for the services even if the economy did take a hit.

What’s more, iSentia has the potential to continue developing new products to enhance its customers’ experience, whilst also generating more revenue per customer. iSentia’s shares currently sell for $3.77.

Although it should be noted that the actual price of a share has no bearing on its value, investors could still buy more shares of each of these companies than they could for many other shares with the same amount of coin.

More importantly, however, the three companies mentioned above could all have further to run.

If none of these companies appeal to you, however, there are plenty of other shares you may be interested in instead.

The Motley Fool's renowned dividend investing guru recently revealed his newest dividend buy recommendation and short list of 3 Best Dividend Buys Now.

In this low interest rate environment, they could generate some very handsome returns for investors.

Simply click here to learn more about these shares.

Motley Fool contributor Ryan Newman owns shares of Burson and iSentia Group Ltd. The Motley Fool Australia owns shares of Burson. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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