All else held equal, low-price stocks outperform high-price ones. It s not clear why.

In theory, nominal stock prices should be irrelevant to performance. There s no difference in market value between a $5-a-share company with 100 million shares outstanding and a $50-a-share company with 10 million shares. Moreover, companies can essentially decide their own stock price by periodically splitting or consolidating their existing shares.

So investors should have no reason to favor stocks with single-digit prices. But they do. One recent study found that, over the 81 years ended 2006, stocks priced below $5 a share beat those priced over $20 by an average of 0.83 percentage points a month. During roughly the second half of that study period when the data set was expanded to include many more low-price shares, the outperformance held but shrank to 0.53 percentage points a month. Even so, that s a humungous performance advantage. On a $10,000 investment over 20 years, it can be the difference between ending up with $46,000 and $146,000.

Company managers seem wise to the added appeal of low-price shares, and many use stock splits when they can. Since the Great Depression, the price of a quart of milk has jumped from nine cents to more than a dollar, but the price of an average share of stock, according to a 2006 study, has remained steady at around $30.

Market researchers speculate that low-price stocks outperform simply because investors are thrown by the numbers. When a broad group of stocks rise 10% in price, the nominal gap between the high-price ones and low-price ones grows larger, making the low-price shares appear like relatively better deals. Of course, if the outperformance of low-price shares is based on such flimsy reasoning, savvy investors shouldn t rely too heavily on the phenomenon. My experience selecting five low-price stocks for readers in May 2009 shows why. Together, the five have gained 28% beating the S&P 500 by several percentage points. But while Flextronics, the best performer of the five, rose more than 90%, American Apparel, the worst performer, lost more than 30%. With such extreme variance in returns, low-price shares are best left to speculative investors.

That noted, below are three more stocks with single-digit prices. I selected them from more than 1,500 large, midsize and small companies by eliminating worrisomely indebted and unprofitable companies.

Stein Mart

Stein Mart has more than 270 stores located largely in the Sunbelt states. Sales at its longstanding stores have declined since 2005, but a turnaround might be afoot. Over the past year, management has reduced expenses, paid down debt and added trendy, youthful brands to stores. In its last two quarters, the company delivered profits when analysts were predicting losses. Shares have multiplied from $1 and change to over $8 in a year.

Smith Micro Software

Based an hour drive down the coast from Los Angeles, Smith Micro Software specializes in software for mobile communications, networks and graphics. Analysts say it s well-positioned for the rollout of 4G, or fourth-generation, cellular service because it receives revenue on new-phone software and has products that enable callers using 3G phones to connect with those using 4G ones. Sales are forecasted to rise 20% this year, and shares trade at about 11 times the 2010 consensus earnings estimate.

Stamps.com

Stamps.com is perhaps best known for its PhotoStamps service, which lets users turn a picture of their kid or dog into real U.S. postage. The company s core business, though, is providing frequent mailers with a way to print postage directly from their computers instead of buying or leasing postage meters. Sales fell last year as a weak economy reduced mailings, but the company is expected to return to growth this year with a modest sales increase. Shares are 16 times earnings or less than 11 times earnings after subtracting the company s nearly $3 a share in cash from its stock price.