In this article, we will take a look at the 10 ridiculously cheap stocks to buy right now.
The Market is Not Cheap Right Now, Strategist Says
The S&P 500 is currently trading at 23 times its forward earnings, indicative that the market is really expensive at the moment. On November 14, Alan McKnight, CIO at Regions Wealth Management, joined CNBC to share his stance on the market and his expectations moving forward.
McKnight agrees that the market is not cheap at the moment, however, this does not mean that investors halt buying. In fact, investors should continue to invest but be wary about volatility. He adds that opportunities are coming up as we head into 2025. McKnight shares that with the expectations from the economy, investors must consider broadening their portfolios. He also remains positive on small and mid-cap stocks.
READ ALSO 10 AI News Updates You Can’t Miss This Weekend and 14 AI Stocks on Wall Street’s Radar.
The Tariff Debate and Its Impact on Investment Strategy
Presidential elections have adjourned, and with that, new questions on the investment outlook have emerged. Investors are curious to see how the proposed tariffs on Chinese goods and all other imports impact the way markets behave moving forward. On November 22, Jeffrey Kleintop, chief global investment strategist at Charles Schwab, joined Rachelle Akuffo on Yahoo Finance to share his expectations of the market and the investment outlook for the new presidential term.
Kleintop shares that the combined tariff claims by the newly elected government would bring the weighted average US tariff to 26%, significantly higher than its current state. He adds that while there is “reason for concern” investors do not need to make significant changes to their portfolios. He also states that currencies adjust with tariffs all the time, and since the dollar is already up by 5%, much of the impact has been mitigated.
Adding to the notion of risk mitigation, Kleintop suggests that diversification, away from popular themes in the United States, is crucial at the moment. Currently, tech and artificial intelligence hold dominance in the market, and investors must consider spreading to other avenues. He also shares that anywhere outside the United States, financials are performing extremely well and expects international stocks to grow moving forward. He adds that Europe is a bright spot where we might see an acceleration in earnings growth and price-to-earnings ratios.
He also acknowledges that AI has the potential to improve productivity, especially in areas that have been “lagging,” and shares he is interested to see how the AI market turns out. While most strategists and analysts are bullish on AI, stocks in this sector are particularly expensive relative to value stocks. That said, let’s take a look at the 10 ridiculously cheap stocks to buy right now.
Stocks
Our Methodology
To come up with the 10 ridiculously cheap stocks to buy right now, we used the Finviz Stock Screener. We set the forward P/E to 8 and under and market capitalization to $2 billion and above. We then shortlisted the top 30 names and sourced their forward P/E from Seeking Alpha and market capitalization from Yahoo Finance. We then ranked them in ascending order of the analyst upside as of November 25, 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 Ridiculously Cheap Stocks to Buy Right Now
10. KB Financial Group Inc. (NYSE:KB)
Analyst Upside as of November 25, 2024: 19%
Forward P/E as of November 25, 2024: 7.51
Market Capitalization as of November 25, 2024: $26.5 Billion
KB Financial Group Inc. (NYSE:KB) is a bank holding group headquartered in South Korea. The company was founded in 2008 and offers a variety of banking and financial services through its 11 subsidiaries. Some of its services include asset management, life insurance, data systems, and investment.
In the third quarter of 2024, KB Financial Group Inc. (NYSE:KB) logged ₩4.39 trillion in cumulative net profit. Despite declining interest rates and slugging economic growth, the company experienced stable profit, particularly in the insurance, securities, and cards segments. During the same quarter, the company logged ₩9.52 trillion in net interest income, of which, its Kookmin Bank subsidiary accounted for most of the revenue.
The company is consistently penetrating new segments to expand its breadth of services and product lines. Previously in June, KB Financial Group Inc. (NYSE:KB) established a subsidiary “KB Fund Partners” to strengthen its fund services business. Through its sustained financial performance, the company is currently working on its shareholder return policy. Over the years, the company has not only experienced a consistent increase in dividends per share but an acceleration in its share buyback programs.
Ariel Investments’ Ariel Global Fund stated the following regarding KB Financial Group Inc. (NYSE:KB) in its Q2 2024 investor letter:
“Additionally, Korea’s largest financial company in terms of assets and customer base, KB Financial Group Inc. (NYSE:KB), increased in the quarter following an earnings beat, highlighted by solid profitability, stable loan growth and net interest margin expansion. Given KB Financial’s capital structure and solid provisioning practices, we believe it is well-positioned to deliver on its enhanced shareholder return policy, inclusive of dividends, buybacks and subsequent share cancellations. Despite the recent outperformance, we still see significant upside in the name as it is trading at 0.5x price-to-book and generates return-on-equity in line with its cost-of-equity.”
9. BP p.l.c. (NYSE:BP)
Analyst Upside as of November 25, 2024: 24%
Forward P/E as of November 25, 2024: 8.15
Market Capitalization as of November 25, 2024: $77.7 Billion
BP p.l.c. (NYSE:BP) is an oil and gas company headquartered in London, United Kingdom. The company is working to revolutionize the energy sector and help the world transition to a net zero status. The company itself is transforming into an integrated energy company from its previous status as an international oil company.
During the third quarter of 2024, the company signed two memorandums that facilitate the exploration and development in offshore Azerbaijan. In addition to that, during the same quarter, BP p.l.c. (NYSE:BP) processed the acquisition of Lightsource bp, a leader in utility-scale solar and battery storage assets. The deal positions BP as an emerging leader in renewable energy, contributing to its transformation.
In the third quarter of 2024, BP p.l.c. (NYSE:BP) generated $206 million in profits attributable to shareholders and $6.8 billion in operating cash flow. During the same quarter, the company announced a share buyback program and completed a $1.75 billion share buyback program from the second quarter of 2024. BP’s emphasis on favoring shareholders contributes to its position as an investor favorite.
Overall, BP p.l.c. (NYSE:BP) believes it has the expertise and skills to help the world achieve net zero status. The company has a solid growth trajectory and analysts are also bullish on the stock. Their median price target points to an upside of 24% from current levels.
8. Equinor ASA (NYSE:EQNR)
Analyst Upside as of November 25, 2024: 26%
Forward P/E as of November 25, 2024: 7.80
Market Capitalization as of November 25, 2024: $67.6 Billion
Equinor ASA (NYSE:EQNR) is an energy company headquartered in Norway with 23,000 employees located in 30 countries across the globe. The company provides energy to nearly 170 million people from across the globe. By 2050, Equinor expects to become a net zero entity and is currently working on finding new solutions to oil, gas, and renewables to make the transition a reality.
The company is notorious for securing strategic partnerships. On November 15, Equinor ASA (NYSE:EQNR) partnered with BP, Shell, and TotalEnergies with a staggering $500 million in total investment to make energy accessible for certain regions in the coming years. The four entities are targeting areas in Sub-Saharan Africa, South Asia, and Southeast Asia. Similarly, on November 18, the company was awarded a two-year contract with Northern Ocean Wind AS to establish a mobile rig on the Norwegian continental shelf.
In the third quarter of 2024, Equinor ASA (NYSE:EQNR) reported net operating income worth $6.91 billion and net income worth $2.29 billion. With such solid results, the company is on track to post solid cash flow from operations before the year’s end. The company has also updated and increased its capacity in its gas value chain and orchestrated strategic decisions to expand throughout the quarter.
Equinor ASA (NYSE:EQNR) celebrates a strong ecosystem and operational infrastructure, that supports its ranking on our list. Analysts are also bullish on the stock and their median price target represents an upside of 26% from current levels.
7. Devon Energy Corporation (NYSE:DVN)
Analyst Upside as of November 25, 2024: 27%
Forward P/E as of November 25, 2024: 8.26
Market Capitalization as of November 25, 2024: $25.9 Billion
Devon Energy Corporation (NYSE:DVN) is an oil and gas exploration and production company that ranks seventh on our list of ridiculously cheap stocks to buy right now. The company’s operations are focused onshore in the United States.
In the third quarter of 2024, Devon Energy Corporation (NYSE:DVN) had stupendous daily production levels, at 335,000 barrels of oil, 194,000 barrels of natural gas, and close to 1.2 billion cubic feet of natural gas. The company boasts a solid liquidity situation. As of Q3 2024, the company has $3.7 billion in total liquidity and a cash balance of $0.7 billion with retired debt worth $0.5 billion.
For the fiscal year 2025, the company expects to reinvest 65% of its cash flow into the company and have total capital worth $4 to $4.2 billion. The company also expects production volumes to reach 800 mboed (Thousand barrels of oil equivalent per day), indicative of its position as a leader in the industry. Devon Energy Corporation (NYSE:DVN) also has a $2.5 billion debt reduction program underway, of which 70% of outstanding debt obligations are expected to mature after 2030.
For the year ahead in 2025, Devon Energy Corporation (NYSE:DVN) expects to sustain its portfolio, build on its financials, and deliver value to its shareholders. Its expansion strategy and growth trajectory align with its 2025 goals, contributing to its ranking on our list.
6. Itaú Unibanco Holding S.A. (NYSE:ITUB)
Analyst Upside as of November 25, 2024: 28%
Forward P/E as of November 25, 2024: 7.36
Market Capitalization as of November 25, 2024: $53.7 Billion
Itaú Unibanco Holding S.A. (NYSE:ITUB) is a financial services company that ranks sixth on our list of ridiculously cheap stocks to buy right now. The company is headquartered in Brazil and has more than 70 million clients. The company provides corporate and investing banking, private banking, asset management, and retail business services to customers in 18 countries.
The full-service commercial bank offers discounts, promotions, and exclusive deals for clients every day. The company has a 100-year legacy that is still carrying momentum today. In the third quarter of 2024, Itaú Unibanco Holding S.A. (NYSE:ITUB) generated R$42.7 billion ($7.33 billion) in revenue.
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, bringing together all the information against scams and financial fraud. To expand on its data-driven growth strategy, the company now has over 430 data scientists, more than 360 initiatives using generative artificial intelligence, 60 plus machine learning engineers, and over 1,000 AI models currently in use.
Overall, Itaú Unibanco Holding S.A. (NYSE:ITUB) is a prominent name in the financial services industry and we say that because of its dominance in the industry and growing use of technology. Analysts are also bullish on the stock and their median price target represents an upside of 28% from current levels.
Ariel Investments’ Ariel Global Strategy made the following comment about Itaú Unibanco Holding S.A. (NYSE:ITUB) in its Q4 2022 investor letter:
“We initiated two new positions in the quarter. Macro-uncertainty also presented us an opportunity to buy shares of Brazilian financial services company, Itaú Unibanco Holding S.A. (NYSE:ITUB). The company is led by a dynamic CEO, who is utilizing technology in the private banking sector as part of a broader move towards digitization. This strategy is not only reducing distribution costs, but is enabling the creation of new products in high market share areas such as private banking, credit cards, as well as small- and medium-size business lending. An attractive valuation, strong net interest margins and high return on equity are among the attributes motivating our purchase of shares.”
5. Banco Santander, S.A. (NYSE:SAN)
Analyst Upside as of November 25, 2024: 35%
Forward P/E as of November 25, 2024: 5.99
Market Capitalization as of November 25, 2024: $69.6 Billion
Banco Santander, S.A. (NYSE:SAN), commonly referred to as Santander Group, is a financial service company based in Santander, Spain. The company has over 166 million customers in over 10 markets. Banco Santander offers financial services such as savings and mortgages, loans, insurance and alarms, and online banking to individuals, companies, institutions, and corporations.
In the third quarter of 2024, the company reported a profit of EUR 3.3 billion, up 12% year-over-year. For the nine months ended 2023, the company logged EUR 9.3 billion in profits, up by 14%. The company has been driving growth by enhancing its customer experience via digital onboarding and simplifying customer journeys.
Automation has been crucial to the company’s success. The company has now established a single model across all its markets for a standardized consumer experience and most of its products and services are available digitally. In the first quarter, the company decided to launch Openbank in the United States. Openbank is one of the largest 100% digital banks by deposits valued at almost EUR 18 billion. More recently, on November 19, Banco Santander, S.A. (NYSE:SAN) debuted Openbank in Mexico with a complete digital proposition and competitive rates.
4. Honda Motor Co., Ltd. (NYSE:HMC)
Analyst Upside as of November 25, 2024: 39%
Forward P/E as of November 25, 2024: 5.85
Market Capitalization as of November 25, 2024: $41.2 Billion
Honda Motor Co., Ltd. (NYSE:HMC) is an automobile company that is among the world’s largest power unit manufacturers. The company was founded in 1948 and now specializes in the production of motorcycles, automobiles, and power products. The company is “connected with customers around the world” through its solid product distribution.
For the fiscal first half ended September 30, Honda Motor Co. (NYSE:HMC) logged $69.95 billion (10.8 trillion yen) in revenue, up by 12.4% year-over-year. Similarly, operating profit grew by 6.6%. For the fiscal year ended March 31, 2025, the company expects to generate $136.05 billion (21 trillion yen) in revenue and $9.2 billion (1.4 trillion yen) in operating profits. Honda Motor Co., Ltd. (NYSE:HMC) has 26.74 million total global units, of which 18.81 million units comprise motorcycles, 4.1 million units consist of automobiles, and 3.81 million units make up power products.
The company has a strong ecosystem that contributes to its financials. The Honda Group is a consortium of 360 companies, of which 289 are consolidated subsidiaries and 71 are equity method affiliated companies. Overall, Honda Motor Co., Ltd. (NYSE:HMC) is one of the ridiculously cheap stocks to buy right now. Analysts are also bullish on the stock and their median price target implies an upside of 39%.
3. Vale S.A. (NYSE:VALE)
Analyst Upside as of November 25, 2024: 42%
Forward P/E as of November 25, 2024: 4.97
Market Capitalization as of November 25, 2024: $42.8 Billion
Vale S.A. (NYSE:VALE) is a mining company headquartered in Brazil and present in more than 20 countries. The company engages in sustainable mining and is one of the largest producers of iron ore, pellets, and nickel. It also has operations in the logistics of mineral exporting.
On the financial front, Vale S.A. (NYSE:VALE) logged $9.55 billion in revenue during the third quarter of 2024. In addition to that, the company reported record performances in production. During the quarter, iron ore production reached its highest levels in more than five years. Vale S.A. (NYSE:VALE) is set to add another 50 metric tons of capacity by 2026 and it also signed a partnership for a new iron ore concentration plant in Sohar, which will be completed by 2027.
In October the company’s second underground mine achieved mechanical completion status. This means that the mine will be able to begin production in the coming months. Previously in September, Vale S.A. (NYSE:VALE) announced an investment in Mantel, a startup that develops low-cost solutions to capture carbon from industrial sources directly. The investment will help Vale pioneer the development of the mining industry.
2. Baidu, Inc. (NASDAQ:BIDU)
Analyst Upside as of November 25, 2024: 43%
Forward P/E as of November 25, 2024: 7.81
Market Capitalization as of November 25, 2024: $27.6 Billion
Baidu, Inc. (NASDAQ:BIDU) ranks second on our list of considerably cheap stocks to buy right now. The Chinese multinational technology company specializes in providing internet services and artificial intelligence. The company operates the largest internet search engine in China and brings most of its revenue from advertising and search.
The company is placing significant bets on AI to fuel its growth strategy. Baidu’s (NASDAQ:BIDU) core revenue reached RMB26.7 billion in the second quarter of 2024, driven by tremendous growth in its AI cloud business. During the quarter, the company invested significantly in its cloud and AI business to ensure the technology is accessible to all. For instance, in June BIDU unveiled ERNIE 4.0, an AI chatbot, capable of delivering high-quality solutions to AI use cases.
As for search, the company has been testing solutions to advance its search capabilities using AI. As of Q2 2024, 18% of search results consist of generated content, up from 11% in May. AI-generated content is able to deliver more accurate and specific results, meeting the needs of users more efficiently.
Ariel Investments’ Ariel Global Fund stated the following regarding Baidu, Inc. (NASDAQ:BIDU) in its first quarter 2024 investor letter:
“Alternatively, several positions weighed on performance. China’s internet search and online community leader, Baidu, Inc. traded lower alongside Chinese equities as intensifying problems in China weighed on investor sentiment during the period. The company continues to invest heavily in Artificial Intelligence (AI) and recently launched its generative AI, Ernie Bot, aimed at rivaling Open AI’s ChatGPT. While monetization of the new technology is largely dependent on regulatory review, we think Baidu should continue to experience margin improvement with the ongoing implementation of efficiency and profitability initiatives. While some investors remain on the sidelines due to uncertainty surrounding China’s economic growth, government regulations, and the political rhetoric towards Taiwan, we remain enthusiastic about Baidu’s longer-term opportunity for revenue growth and margin expansion across internet search, cloud, autonomous driving, artificial intelligence and online video.”
1. Prudential plc (NYSE:PUK)
Analyst Upside as of November 25, 2024: 87%
Forward P/E as of November 25, 2024: 7.63
Market Capitalization as of November 25, 2024: $21.4 Billion
Prudential plc (NYSE:PUK) ranks first on our list of the 10 ridiculously cheap stocks to buy right now. The multinational insurance and asset management company is headquartered in the United Kingdom and Hong Kong. The company caters to more than 18 million customers across 24 markets in Asia and Africa.
Prudential plc’s (NYSE:PUK) position on our list can be attributed to its expansion strategy. Earlier in September, the company initiated investments in Nigeria. Under the investment, the company agreed to acquire the remaining shares of its joint venture in Nigeria, Prudential Zenith Life Insurance Limited. On the same day, the company announced its strategic partnership with Bank Syariah Indonesia. Under the partnership, the company will function as the life insurance provider of the bank starting in early 2025. The two strategic moves not only expand PUK’s position in the respective regions but also level up its penetration into bancassurance.
More recently, on November 19, the company launched a global artificial intelligence lab in Singapore. The lab aims to accelerate the integration of artificial intelligence, generative artificial intelligence, and machine learning across all levels of the organization. Since the soft launch of the lab in August, Prudential (NYSE:PUK) has orchestrated over 100 AI use cases across its 24 markets in Asia and Africa.
According to the company’s Q3 performance update, Prudential plc (NYSE:PUK) saw an increased momentum in its business performance. The company attributes the growth in business profits to its multi-channel distribution model. The company expects to strengthen its distribution network and drive greater quality.
While we acknowledge the potential of PUK to grow, our conviction lies in the belief that certain 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 PUK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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