In this article, we will take a look at 10 stocks under $25 to buy. If you want to see more stocks under $25 to buy, go directly to 5 Stocks Under $25 to Buy Now.
The market is calmer given the latest economic data that shows that inflation may be peaking. October’s core inflation growth of 5.2% year over year was lower than September’s growth of 5% year over year.
The CBOE Volatility Index (VIX) has also declined to below 20 recently. With the VIX lower, it seems investors are not expecting as much volatility in the S&P 500 as they did before.
Nevertheless, there is still debate over what might happen next.
Although the Federal Reserve has indicated that it won’t increase interest rates as fast as it did in the past several months, many economists still think the U.S. central bank has a ways to go before it finishes raising rates.
If rates rise too much, demand for many companies might weaken and the U.S. economy might slow. If that happens, corporate earnings might not be as strong as expected and stocks could be significantly more volatile when the next earnings season begins.
There is also a chance of a recession next year even if the stock market has rallied recently. Billionaire founder of Amazon, Jeff Bezos, recently said for consumers, “Take some risk off the table. Just a little bit of risk reduction could make the difference.” Bezos meant consumers should try to save some money in case the economy worsens.
Given the uncertainty, it could be a good idea for long term investors to own a well diversified portfolio of many stocks across many different sectors.
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Methodology
For our list of 10 Stocks Under $25 to Buy Now, we picked 10 stocks that could potentially grow earnings per share in the long term. We then ranked the stocks based on the number of hedge funds in our database that owned shares of the same stock at the end of Q3.
10 Stocks Under $25 to Buy Now
10. Simmons First National Corporation (NASDAQ:SFNC)
Number of Hedge Fund Holders: 11
Simmons First National Corporation (NASDAQ:SFNC) is a regional bank that operates 230 branches through its principal subsidiary Simmons Bank in states throughout Arkansas, Kansas, Missouri, and more.
Founded in 1903, Simmons First National Corporation (NASDAQ:SFNC) has paid cash dividends to its shareholders for 113 straight years. Although shares have fallen 23% year to date to $22.76 per share, Simmons First National Corporation (NASDAQ:SFNC) stock is still considerably higher than what it was 10 years ago when it traded for around $14 per share.
While a recession could lead to more downside, Simmons First National Corporation (NASDAQ:SFNC) has attractive normalized earnings power in the long term and the company trades for 0.92 times book value as of 12/4.
Of the 920 hedge funds in our database, 11 held shares in Simmons First National Corporation (NASDAQ:SFNC) at the end of Q3, ranking the bank #10 on our list of 10 Stocks Under $25 to Buy Now.
Alongside Robinhood Markets, Inc. (NASDAQ:HOOD), New York Community Bancorp, Inc. (NYSE:NYCB), and Regions Financial Corporation (NYSE:RF), Simmons First National Corporation (NASDAQ:SFNC) is a stock under $25 that multiple hedge funds in our database owned at the end of Q3 2022.
9. First Bancorp (NYSE:FBP)
Number of Hedge Fund Holders: 16
Unlike the broader market, First Bancorp (NYSE:FBP) stock has rallied 9.07% year to date given strong earnings. Since 2012, shares of First Bancorp (NYSE:FBP) have also tripled to $15.03 per share although there has been volatility along the way.
First Bancorp (NYSE:FBP) is a regional bank that operates a banking holding company for FirstBank Puerto Rico. For the third quarter, First Bancorp (NYSE:FBP) reported net income of $0.40 per diluted share, up from $0.38 per diluted share for the second quarter. For the nine month period ended September 30, 2022, the bank also repurchased around 15.9 million shares for a total purchase price of $225 million.
8. Eastern Bankshares, Inc. (NASDAQ:EBC)
Number of Hedge Fund Holders: 17
Eastern Bankshares, Inc. (NASDAQ:EBC) is a Boston based regional bank that serves communities in eastern Massachusetts, southern and coastal New Hampshire, and Rhode Island. Founded in 1818, Eastern Bank has over 120 locations and around $22 billion in total assets. In the third quarter, Eastern Bankshares, Inc. (NASDAQ:EBC) reported net income of $0.33 per diluted share, compared to $0.31 per diluted share for the second quarter of 2022.
Eastern Bankshares, Inc. (NASDAQ:EBC) CEO Bob Rivers said, “Our financial results for the third quarter were strong, led by 16 percent loan growth on an annualized basis, while maintaining our high credit quality and underwriting standards. Additionally, our net interest margin expanded by twenty-four basis points from the prior quarter, driving a ten percent increase in net interest income.” Although shares of the bank are down 3.37% year to date, Eastern Bankshares, Inc. (NASDAQ:EBC) stock is still higher than its IPO price in 2020. 17 owned shares of Eastern Bankshares, Inc. (NASDAQ:EBC) at the end of the third quarter, ranking the company #8 on our list of 10 Stocks Under $25 to Buy Now.
7. Physicians Realty Trust (NYSE:DOC)
Number of Hedge Fund Holders: 19
Physicians Realty Trust (NYSE:DOC) is a REIT that invests in healthcare facilities that ranks #7 on our list of 10 Stocks Under $25 to Buy Now. Like many other REITs in 2022, Physicians Realty Trust (NYSE:DOC) has been negatively affected by the Federal Reserve’s interest rate hikes which have increased the cost of floating debt and decreased the attractiveness of dividends given the rise in Treasury yields. At its current price of $15.25 per share, Physicians Realty Trust (NYSE:DOC) REIT has a dividend yield of 6.03% which is around 2.5% higher than the 10 year Treasury yield, however. As a result of the headwinds, shares of Physicians Realty Trust (NYSE:DOC) have declined 19% year to date but are still higher than their price in 2013.
6. Valley National Bancorp (NASDAQ:VLY)
Number of Hedge Fund Holders: 20
Valley National Bancorp (NASDAQ:VLY) is a regional bank with 232 branch offices in New Jersey, New York, Florida and Alabama as of December 31, 2021. In the third quarter, the bank reported net income of $0.34 per diluted common share versus third quarter 2021 earnings of $0.29 per diluted common share.
Valley National Bancorp (NASDAQ:VLY) CEO Ira Robbins said, “The third quarter’s exceptional results were highlighted by continued profitability improvement and very strong credit quality metrics. Our asset sensitive balance sheet continues to grow and benefit from rising interest rates despite the increased funding pressure that is evident across the industry. We are pleased with our ongoing net interest margin enhancement and consistent net interest income growth. Despite a reduction in origination activity, loan growth remained strong as payoffs slowed meaningfully during the quarter. Additionally, a handful of positive credit resolutions led to approximately $6 million of net loan recoveries during the third quarter 2022 and a reduction in non-accrual loan balances at September 30, 2022.”
At a stock price of $12.49 per share as of 12/4, the bank trades 1.04 times book value and has a dividend yield of 3.52%. Shares of Valley National Bancorp (NASDAQ:VLY) are around the same price as what they were in 2012 so much of the return has been due to the dividend.
Like Valley National Bancorp (NASDAQ:VLY), Robinhood Markets, Inc. (NASDAQ:HOOD), New York Community Bancorp, Inc. (NYSE:NYCB), and Regions Financial Corporation (NYSE:RF) are stocks under $25 that multiple hedge funds in our database owned at the end of the third quarter.
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Disclosure: None. 10 Stocks Under $25 to Buy Now is originally published on Insider Monkey.
