In this article, we will take a look at the 10 best affordable stocks under $10 to buy.
The Rate Cut Debate Continues
The Fed commenced its easing cycle, however, the debate stands. Investors and analysts alike are fixated on what the Fed’s path will look like before the year comes to a close. On October 16, Seema Shah, Principal Asset Management’s chief global strategist, appeared in an interview on Yahoo Finance to discuss her rate cut expectations and thesis on the equity market.
Shah emphasizes that while the jobs report was strong, the data upholds an element of seasonality and volatility. She adds that it’s important that these numbers alone are not blown out of proportion or extrapolated to predict the Fed’s cycle. While she acknowledges that labor demand has been sluggish, she believes that the trends have not been as concerning so far.
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In addition to that, while the US economy has been sluggish, it is not showing signs of decline, indicative of the fact that a normalization process is underway. Shah believes a 25 basis point cut in November and December would be the most ideal situation. She adds that the Fed’s path is pretty clear for now and uncertainty will start to come in by mid-2025.
Strong Fundamentals are Key to Equities
People have kept aside cash for quite a while now, and like other investors and analysts, Seema Shah also sheds light on the situation and hints at risk assets becoming popular. Shah shares that there is approximately $6.6 trillion sitting in money market funds right now and she does not expect all of it to move to equities. In fact, part of the money sitting in cash will be used by people to create safety nets for themselves.
She adds that investors who had moved their investments into safe spaces during a period of high interest rates are more likely to move out their cash to other investment places as interest rates start to go down. With a soft landing in sight, Shah shares stocks are in a sweet spot, especially because the upside to equities is growing.
Overall, equities boast a continued upside, not as high as 2023, but solid regardless. The upside to equities is going to be primarily driven by fundamentals, especially earnings. Moreover, during growth periods, the market broadening out to other sectors is key, which has been the case for 2024. Since fundamentals are crucial at the moment, we have compiled a list of cheap stocks with strong fundamentals and solid earnings growth expectations. Let’s take a look at the 10 best affordable stocks under $10 to buy.
A senior executive looking up at a large boardroom filled with the stocks their company manages.
Our Methodology
To come up with the 10 best affordable stocks under $10, we studied stocks on the Finviz Stock Screener with a Forward P/E of under 15 and a share price of less than $10. We then examined the hedge fund sentiment of each stock and picked the most popular ones. Our list is in ascending order of the number of hedge fund holders as of Q2 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Best Affordable Stocks Under $10 to Buy
10. Nokia Oyj (NYSE:NOK)
Number of Hedge Fund Holders: 18
Share Price as of October 18, 2024: $4.34
Forward P/E as of October 18, 2024: 11.42
Nokia Oyj (NYSE:NOK) is one of the oldest telecommunications companies in the world and ranks 10th on our list of the best affordable stocks under $10 to buy. The company provides mobile network solutions, data center network solutions, IP network solutions, and private network solutions, to name a few.
The company is leveraging artificial intelligence at a rapid pace. On October 18, Nokia (NYSE:NOK) announced the integration of AI-driven operations into its automation platform for broadband networks. The new applications will help analyze network data and drive automation. In addition to that, it will also be able to detect anomalies in networks faster and fix issues before they occur.
On the innovation front, the company is working with Windstream Wholesale and Colt Technology Services to develop the world’s first optical and IP service trial that connects London and Chicago. In addition to that, on October 10, Nokia (NYSE:NOK) and RACSA deployed the first 5G network in Costa Rica, an incredible feat in the telecom industry. The initial rollout promises 5G connectivity in urban areas, consisting of 30 sites in major cities, with an expectation to expand to 500 sites in smaller phases.
In the fiscal third quarter of 2024, the company experienced a decline in mobile network revenue. On the flip side, revenue from network infrastructure and Nokia technologies grew but slightly slower than expected. Overall, Nokia (NYSE:NOK) has significant projects lined up that promise growth in the coming years, especially as it begins to improve its standing on artificial intelligence.
9. B2Gold Corp. (NYSE:BTG)
Number of Hedge Fund Holders: 22
Share Price as of October 18, 2024: $3.33
Forward P/E as of October 18, 2024: 13.29
B2Gold Corp. (NYSE:BTG) is a mining company headquartered in Canada. The company is a gold producer that has mines in Mali, Namibia, and the Philippines with exploration capabilities in Finland, Mali, Namibia, Colombia, and the Philippines.
In the second quarter of 2024, total gold production for B2Gold Corp. (NYSE:BTG) reached 212,508 ounces. While the company experienced some availability issues at a mine in the second quarter, the situation is expected to improve by the end of the fiscal third quarter of 2024. During Q2, the company generated $492.57 million from gold revenue, up by 4.61% year-over-year.
The company has a vast network, contributing to its position on our list. For the fiscal year 2024, B2Gold Corp. (NYSE:BTG) expects total gold production to reach between 800,000 and 870,000 ounces. The company also upholds its corporate social responsibility by supporting locals and integrating the environmental impact into every decision they make.
BTG is not just a cheap stock, but it is also a dividend payer with a payout ratio of 66.67%. By the end of Q2 2024, BTG had cash and cash equivalents worth $467 million, allowing it to pay generous dividends. Overall, BTG is one of the best affordable stocks under $10 to buy now.
8. CEMEX, S.A.B. de C.V. (NYSE:CX)
Number of Hedge Fund Holders: 22
Share Price as of October 18, 2024: $5.94
Forward P/E as of October 18, 2024: 7.97
CEMEX, S.A.B. de C.V. (NYSE:CX) ranks eighth on our list of the best affordable stocks to buy under $10. The multinational building materials company is headquartered in Mexico. The company aims to meet the sustainable construction needs of people from across the globe. Its major products include cement, ready-mix concrete, and urbanization solutions.
The company is expanding its footprint on a global scale. On October 15, CEMEX (NYSE:CX) supplied 100,000 cubic meters of concrete to Dubai, UAE, for the construction of the Hassyan Power Plant. The plant is high on efficiency. It significantly reduces fuel consumption and emissions and generates 2,400 megawatts of electricity, covering 25% of Dubai’s demand.
The company plans to become a net-zero CO2 company by 2050 and is actively engaged in achieving the target at the moment. By 2030, CEMEX (NYSE:CX) plans to celebrate a 58% reduction in CO2 emissions per ton of cementitious product, with 2020 as a base year. To achieve its 2030 sustainability goals, the company aims to invest $150 million annually. So far, the company has achieved a 33% reduction in net CO2 emissions per ton of cementitious product based on its levels in 1990.
The company is emerging as a global leader driving sustainability and positive social impact. Its large network along with its sustainable methods of production promise significant growth in the coming years. This explains why 22 hedge funds were bullish on the stock at the end of Q2 2024.
7. Coty Inc. (NYSE:COTY)
Number of Hedge Fund Holders: 23
Share Price as of October 18, 2024: $7.82
Forward P/E as of October 18, 2024: 14.08
Coty Inc. (NYSE:COTY) is a beauty company based in New York, United States. The company sells beauty products across two major segments including Coty Luxury and Coty Consumer. It licenses luxury brands such as Gucci, Burberry, Hugo, Bourjois, and CoverGirl. The company sells fragrances, color cosmetics, skincare, and body care in more than 125 countries and territories.
On the innovation front, Coty Inc. (NYSE:COTY) has been making some progress. In September, the company launched its first scientific advisory board that would meet twice a year to inspire breakthroughs among R&D specialists at COTY, with a special focus on skincare. Fast forward to October 17, the company revealed its innovations at the 34th International Federation of Societies of Cosmetic Chemists Congress (IFSCC). The company revealed its study on the application of neuroscience in product development. The study is the backbone of its recent innovation, Paixão Feminino Ancestral. This is a special body care line with body lotion and oil that is focused on how sensory stimuli influence people’s moods.
Overall, Coty has sustained revenue growth across key markets growing by mid-single digits to double-digit rates. In the fiscal first quarter of 2025, the company grew its sales by 4-5%, below its estimated growth of 6%. Coty Inc. (NYSE:COTY) expects sales to moderate in the fiscal second quarter of 2025, with minimal growth acceleration, due to cautious retailers.
Despite slower activity in the retail industry, the company expects its cost-reduction initiatives to bring fruit. For fiscal year 2025, the company expects to see its EBITDA increase by 9-11% as it reaps the benefits from cost savings and continued growth in sales. In addition to that, Coty Inc. (NYSE:COTY) is trading at a discount of 23.4% from its sector median of 18 and analysts expect its earnings to grow by 48.6% this year.
6. ADT Inc. (NYSE:ADT)
Number of Hedge Fund Holders: 23
Share Price as of October 18, 2024: $7.02
Forward P/E as of October 18, 2024: 10.49
ADT Inc. (NYSE:ADT) is a security company that ranks sixth on our list of the most affordable stocks under $10 to buy now. The company provides security products to residential customers and small businesses. Some of its products include fire protection, alarm security, video cameras, life safety detectors, and smart home products.
The company has been operational for 150 years and has consistently worked to improve the safety of 6 million customers in over 150 locations in the United States. ADT Inc. (NYSE:ADT) has also been working to drive innovation. In September, the company partnered with Z-Wave Alliance, a wireless communication protocol that allows smart home devices to function together smoothly. The partnership promises integrated and reliable user-friendly products for customers.
In the second quarter of 2024, the company generated $1.2 billion in revenue, up by 3%. The company had strong financial results in the first half 2024, with continued revenue growth and cash flow improvement. ADT Inc. (NYSE:ADT) also expects to increase investment in innovation and provide premium smart home solutions.
Overall, ADT Inc. (NYSE:ADT) is a cheap stock. The company is trading at a discount of 40% from its sector median. Analysts polled by Yahoo Finance expect its earnings to grow by 33.3% this year. ADT is a buy and we attribute that to its unique product portfolio with an extensive focus on innovation.
Ariel Investments stated the following regarding ADT Inc. (NYSE:ADT) in its Q2 2024 investor letter:
“Leading provider of automated security solutions ADT Inc. (NYSE:ADT) also traded up in the quarter. A top- and bottom-line earnings beat, highlighted by strong growth within the consumer and small business segment, low attrition, an improving payback period and margin expansion aided shares. Meanwhile, ADT sold its commercial business and is winding down its solar business to focus on profitability in the residential sector and pay down debt. We continue to believe ADT’s industry-leading brand and national presence, coupled with its Google and State Farm strategic partnerships, position it to be a prime beneficiary of growing demand for smart home technologies, including fully monitored residential security.”
5. Kosmos Energy Ltd. (NYSE:KOS)
Number of Hedge Fund Holders: 25
Share Price as of October 18, 2024: $4.21
Forward P/E as of October 18, 2024: 8.55
Kosmos Energy Ltd. (NYSE:KOS) is an upstream oil company that specializes in deepwater exploration. The company is focused on meeting the growing demand for energy from across the globe. The company has oil production and exploration capabilities in Ghana, Equatorial Guinea, and the Gulf of Mexico, as well as gas development capabilities in Mauritania and Senegal.
In the second quarter of 2024, Kosmos Energy Ltd. (NYSE:KOS) boasted net production of 62,100 barrels of oil equivalent per day, up by 7% year-over-year, with sales of 65,400 barrels of oil equivalent per day. Revenue in dollar terms was valued at $451 million with capital expenditures at $215 million.
During the same quarter, the company achieved the first oil at Winterfell, completed the Kodiak-3 well workover, and completed the startup of the Odd Job subsea pump project. That said, full-year capital expenditures are expected to reach $750 million. Ahead of 2024, the company expects production to increase and capital expenditure to decrease, bringing in higher levels of free cash flow and improved liquidity.
Overall, the company expects production to rise as crucial startups have been completed and projects have been delivered. With these projects, the company expects to close the year with 90,000 barrels of oil equivalent per day. Kosmos Energy Ltd. (NYSE:KOS) expects to carry its current momentum into 2025 and lock in greater growth opportunities. KOS is cheap and we say that because it is trading at a discount of 29% to its sector median. Analysts expect KOS to grow its earnings by 4.8% this year.
Patient Capital Management stated the following regarding Kosmos Energy Ltd. (NYSE:KOS) in its Q3 2024 investor letter:
“Both Kosmos Energy Ltd. (NYSE:KOS) and Seadrill Limited (SDRL) were top detractors in the quarter as energy prices moved lower. We believe both these names are particularly attractive for idiosyncratic reasons beyond a simple bet on energy prices.
Kosmos Energy (KOS) is an exploration and production services company with assets in Africa. The company is nearing the point where their free cash flow generation will inflect meaningfully higher as new production comes online and CAPEX spend returns to a more normalized maintenance level. We see this as a classic case of time arbitrage where the market is myopically focused on the current year’s high level of investment while ignoring the strong free cash flow generation on the other side. At the current commodity curve, the company will generate its market cap in FCF from 2025-2028. With the combination of gas heavy reserves and inflecting cash flow generation, we think Kosmos is significantly undervalued and a potential acquisition target.”
4. Itaú Unibanco Holding S.A. (NYSE:ITUB)
Number of Hedge Fund Holders: 25
Share Price as of October 18, 2024: $6.21
Forward P/E as of October 18, 2024: 7.86
Itaú Unibanco Holding S.A. (NYSE:ITUB) is a financial services company that ranks fourth on our list of the most affordable stocks under $10 to buy now. The company is headquartered in Brazil and now has more than 70 million clients. The company provides corporate and investing banking services, private banking services, asset management, and retail business services to customers in 18 countries.
The full-service commercial bank also provides discounts, and promotions, and offers exclusive deals and solutions for clients every day. The company has a legacy of 100 years that is still carrying momentum today. In the second quarter of 2024, Itaú Unibanco Holding S.A. (NYSE:ITUB) generated R$41.8 billion ($7.34 billion) in revenue. The company has been investing significantly in optimizing efficiency gains. Compared to 2018, the company has decreased infrastructure costs by 37% and has increased solution development investments by 2X.
On the customer front, Itaú Unibanco (NYSE:ITUB) has been working to improve its presence digitally. In September, the company launched an update to its Superapp. The new update includes a Security Hub, a function that brings together all the information and services offered by the bank against scams and financial fraud. The new addition places the company as an emerging leader in financial security and banking.
Overall, Itaú Unibanco Holding S.A. (NYSE:ITUB) is a prominent name in the financial services industry and we say that because of its vast network. The company has more than 3,300 branches and over 40,000 ATMs in Brazil and other locations across Latin America. The company has strong fundamentals and solid financial performance, contributing to its position on our list.
3. Bumble Inc. (NASDAQ:BMBL)
Number of Hedge Fund Holders: 26
Share Price as of October 18, 2024: $7.14
Forward P/E as of October 18, 2024: 7.03
Bumble Inc. (NASDAQ:BMBL) is one of the most affordable stocks under $10 to buy. Bumble Inc. is a social network company behind the popular dating application, Bumble. The platform steps away from traditional dating experiences allowing women to take the first move and feel empowered in doing so.
Users can not only find dates, but they can also find new friends on Bumble for Friends and make career moves on Bumble Bizz. In the second quarter of 2024, the company logged revenue worth $269 million, up by 3%. The Bumble App revenue increased by 5% to reach $218 million. In addition to that, paid users for the Bumble App increased by 15% to reach 2.8 million, and grew by 87,000 quarter-over-quarter. Total paying users for Bumble Inc., on the other hand, reached 4.1 million, compared to 3.6 million in Q2 2023.
Expansion and growth were major goals of the company this year. In May, Bumble Inc. (NASDAQ:BMBL) signed an agreement to acquire a group and community application, Geneva, that connects people based on shared interests. The acquisition is expected to close in the third quarter of 2024 and will boost Bumble’s position on connecting people, especially friends and communities.
Overall, Bumble Inc. (NASDAQ:BMBL) is a cheap stock that has a consistent financial performance and a growing user base. The company’s strategic moves align well with its brand image and the value it aims to bring to customers, contributing to its ranking on our list. According to the Insider Monkey database, 26 hedge funds were bullish on the stock at the close of Q2 2024.
Polen Capital’s Polen Global SMID Company Growth Strategy stated the following regarding Bumble Inc. (NASDAQ:BMBL) in its Q2 2024 investor letter:
“We exited our position in Bumble Inc. (NASDAQ:BMBL), a global leader in the mobile dating app space, due to several Flywheel violations. We initially entered this position roughly two years ago due to the founder-led management team, the robust brand of their key Bumble asset, the opportunity to expand Bumble globally, and the attractive margin and free cash flow profile. Over the last year, the founder has taken a step back from the business into an Executive Chairman role; the COO left to become CEO of another tech start-up, and a new CEO has made several material changes to the general management structure and will be introducing significant changes to the company’s core products. According to management and third-party data, the “swipe” dating apps are struggling to grow downloads in key markets and need a product refresh to reinvigorate growth, perhaps leveraging new Al technologies to enhance user experience and matching capabilities. Together, the new management team and the app “refresh” introduce a level of execution and reinvestment risk that violates our Flywheel. The company remains a leader in the dating space and highly profitable, but we believe it prudent to watch how this business evolves from the sidelines.”
2. Clarivate Plc (NYSE:CLVT)
Number of Hedge Fund Holders: 27
Share Price as of October 18, 2024: $6.70
Forward P/E as of October 18, 2024: 9.06
Clarivate Plc (NYSE:CLVT) ranks second on our list of the most affordable stocks under $10 to buy. Clarivate is an analytics company that is focused on transformative intelligence. Some of its solutions include enriched data, insights and analytics, workflow solutions, and expert services to several segments including academia, the government, intellectual property, life sciences, and healthcare.
Clarivate Plc (NYSE:CLVT) is expanding its footprint across borders and in AI. Previously in September, the company partnered with TerraSky to help customers in Japan enhance and improve their strategic IP assets. During the same month, the company forged a partnership with Relatable Healthcare, a health tech company that makes Product Relationship Management (PRM) software for medtech companies to manage workflows. The partnership ensures that Relatable’s customers can access competitive intelligence from Clarivate.
In an incredible feat to leverage AI, the company launched a generative AI-powered research assistant, Primo, on September 18. Primo facilitates seamless research for students and researchers alike by providing immediate answers to queries with sources and references.
During the second quarter of 2024, Clarivate Plc (NYSE:CLVT) logged revenue worth $650.3 million. The company is happy with its progress on the innovation front and expects these strategic changes to help it grow. Customers are also immensely satisfied with its product improvement, resulting in higher customer renewals and new customers, which is expected to drive organic growth in the second half of 2024.
Cove Street Capital Small Cap Value Fund stated the following regarding Clarivate Plc (NYSE:CLVT) in its Q2 2024 investor letter:
“We also added a position in Clarivate Plc (NYSE:CLVT), a data services provider that operates across academic research, intellectual property, and life sciences. We came to the investment from cross-work in another holding, Research Solutions (ticker: RSSS). Ultimately this company sucks in data from participants in the industry, aggregates it, and provides value added services and tools back to those industry participants. The power is in providing customers access to the aggregate. This was a private equity roll-up of a bunch of different data assets that paid too little attention to product innovation, leading to a period of stagnating growth and repeatedly missing guidance. The business of selling many tools and services on a pile of fixed cost assets (data) remains tremendous as can be seen by Clarivate’s mid-to-high 30% EBITDA margins and strong returns on invested capital. With new management and board members in place and 18 months of an “investment cycle” under their belt, we view the risk/reward of CLVT to be favorable at these levels, with a strong upside case if they can reinvigorate growth to their target levels.”
1. BGC Group, Inc. (NASDAQ:BGC)
Number of Hedge Fund Holders: 33
Share Price as of October 18, 2024: $9.49
Forward P/E as of October 18, 2024: 10.20
BGC Group, Inc. (NASDAQ:BGC) is one of the best affordable stocks under $10 to buy. The financial services company provides various services including trade execution, broker-dealer services, clearing, and processing. The company offers more than 200 financial products to banks, broker-dealers, investment banks, trading firms, governments, property owners, real estate developers, and investment firms.
BGC Group, Inc. (NASDAQ:BGC) is making good use of technology to enhance its offerings. Since 1998, the company has spent over $1.7 billion on technology. These technologies are focused on meeting the complex needs of BGC’s customers and enhancing efficacy across all its verticals.
In the second quarter of 2024, the company generated revenue worth $550.8 million, up 11.7% year-over-year. The company’s revenues were driven by improving operability and growth across different segments and geographically. Most of its segments reported double digital growth in revenues, namely ECS (Energy, Commodities, and Shipping), Foreign Exchange, and Credit.
Overall, BGC Group, Inc. (NASDAQ:BGC) has significant growth potential as it expands into new high-growth markets and improves internal business efficacy. The company is an affordable stock and we say that because it is trading at a forward P/E of 10, a discount of 21% from the sector median. Analysts polled by Yahoo Finance expect the stock to grow its earnings by 13.4% this year.
O’keefe Stevens Advisory stated the following regarding BGC Group, Inc. (NASDAQ:BGC) in its Q3 2024 investor letter:
“BGC Group, Inc. (NASDAQ:BGC) – After a long-awaited arrival, the FMX Futures Exchange launched on September 24th. Years of expenses flowing through BGC’s financials without offsetting revenue are reversing. While we are keenly aware of the ramp-up period from 0 volume to market share gains provided by the CME, FMX’s compelling offerings are anticipated to gain market share slowly. In addition, per BGC’s standard practice, announced revenue and pre-tax income will come in at the high end of management’s guidance.
Uncertainty is BGC’s best friend. Entering 2024, rate cut expectations of 150bps reflected optimism around the aggressive and dramatic decline of rates. In September, a 50bps cut marked the first rate cut since 2020 and the reversal after 2.5 years of interest rate hikes. Officials target a range of 4.25-4.50% by the end of this year, which signals two quarter-point rate cuts or one half-point cut. For 2025, they expect to cut four more times, bringing their Fed Funds rate to 3.25-3.5%. We are unconvinced the higher inflation experienced in recent years is over, putting these rate-cut expectations at risk. For BGC, whether we experience 50 bps cuts or 150 bps, conflicting economic data points will continue driving record volumes. With one sell-side analyst covering the name, this stock continues to trade under the radar and remains a core holding.”
While we acknowledge the potential of financial services companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BGC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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