On September 30, Federal Reserve Chair Jerome Powell addressed the National Association for Business Economics (NABE) Annual Meeting in Nashville, TN, and expressed his views on the economy, highlighting both positive and negative trends. On the positive side, he noted that the economy has shown resilience and is still growing at a solid pace, with the labor market remaining strong. He also mentioned that the recent upward revisions to GDP and GDI have removed a downside risk to the economy and that the savings rate has increased, indicating that consumers have more savings on their balance sheets.
However, Powell also pointed out that the labor market has cooled, with the unemployment rate rising to 4.2% and the job finding rate decreasing. He noted that this cooling is not necessarily a bad thing, as it may be a sign of a more sustainable labor market. Additionally, he mentioned that the housing market is still a concern, with housing inflation running at around a 3% annualized pace, which is contributing to overall inflation.
In terms of monetary policy, Powell indicated that the Fed is committed to using its tools to achieve its inflation target of 2%. He noted that the Fed has made progress in reducing inflation but still has work to do. He also stated that the Fed will be monitoring the data closely and will adjust its policy stance as needed to maintain the strength of the economy.
Jamie Dimon: Fed Rate Cut Was Necessary
In an interview with CNBC on 29 September, Jamie Dimon, CEO of JPMorgan Chase, discussed the recent interest rate cut by the Federal Reserve, saying that it was a necessary move to adjust to slowing economic growth and decreasing inflation. He notes that the economy is still strong but that there are underlying concerns about inflation and geopolitics that could impact the market. In terms of geopolitics, Dimon expresses concern about the ongoing war in Ukraine and notes that it is likely to get worse. He believes that the US and its allies need to be prepared for a longer war and that more military help will be needed to support Ukraine. Dimon also touches on the topic of the US presidential election, saying that he is not endorsing any candidate at this time and is instead focusing on policy issues that can help both the world and the US.
With the Fed’s ongoing efforts to balance growth and inflation, the economy appears poised to continue its steady expansion; with that in context, let’s take a look at the 7 best cheap stocks to buy today under $10.
A senior executive looking up at a large boardroom filled with the stocks their company manages.
Our Methodology
To compile our list of the 7 best cheap stocks to buy today under $10, we used the Finviz and Yahoo stock screeners to find the largest companies with stock prices under $10. From that list, we selected companies that are trading at a forward P/E ratio of under 15, as of October 1. We then narrowed our choices to 7 stocks that were the most widely held by hedge funds. The list is sorted in ascending order of their hedge fund sentiment, as of the second quarter, which we sourced from our database.
Why do we care about what hedge funds do? 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).
7 Best Cheap Stocks To Buy Today Under $10
7. B2Gold (NYSE:BTG)
Number of Hedge Fund Investors: 22
Forward P/E Ratio as of October 1: 13.85
B2Gold (NYSE:BTG) is a Canadian-based gold mining company with operations primarily in Africa and the Philippines. The company has a strong portfolio of assets, including the Fekola mine in Mali, the Masbate mine in the Philippines, and the Otjikoto mine in Namibia.
On September 11, B2Gold (NYSE:BTG) reached a new agreement with the Mali government regarding the Fekola Complex. As a result of the agreement, B2Gold (NYSE:BTG) expects to receive expedited approvals for Fekola Regional and Fekola Underground, with initial gold production from Fekola Regional expected to commence in early 2025 and initial gold production from Fekola Underground expected to commence in mid-2025. B2Gold’s (NYSE:BTG) Goose project in Canada, a gold mining project in the Back River Gold District of Nunavut, Canada, is also expected to come online in 2025 and produce over 310,000 ounces of gold annually. The project has total resources exceeding 9.2 million ounces.
B2Gold’s (NYSE:BTG) valuation suggests that the stock is undervalued compared to its peers. The company’s stock is trading at a forward PE of 13.85, a 17.51% discount to its sector median of 16.79. As of the second quarter, the company’s stock is held by 22 hedge funds, with a total stake valued at $132.61 million.
6. ADT (NYSE:ADT)
Number of Hedge Fund Investors: 23
Forward P/E Ratio as of October 1: 10.90
ADT (NYSE:ADT) is a leading provider of security and smart home solutions in the United States. The company offers services such as alarm monitoring, video surveillance, and home automation.
ADT (NYSE:ADT) has been expanding its product portfolio by leveraging advancements in smart technology to enhance its service offerings. The company’s subscription-based model provides recurring revenue, making it attractive to investors looking for stability in the security services industry. ADT (NYSE:ADT) has a strong presence in the market, with over 6.4 million security monitoring service subscribers.
ADT (NYSE:ADT), in collaboration with Google, offers ADT Self Setup, a fully integrated and customizable DIY smart home security system. This innovative offering allows users to access and control their security system from anywhere with cellular service using the ADT+ app and users can easily customize and manage their smart home security system to fit their unique needs, all from the convenience of their mobile device. ADT (NYSE:ADT) is expected to benefit from the fast-growing do-it-yourself (DIY) market, which is driving demand for the company’s security and smart home solutions. The company is also investing in cybersecurity upgrades, which are expected to enhance future net sales growth.
ADT’s (NYSE:ADT) commitment to innovation and customer satisfaction, as well as its strong market position, make it well-positioned for future growth. The company’s stock is trading at a forward PE of 10.90, a 37.31% discount to its sector median of 17.39. Analysts expect the company to increase its earnings by 28.57% this year and have a consensus on the stock’s Buy rating, setting an average share price target at $9.03, which represents a 22.14% upside potential from its current level. As of the second quarter, the company’s stock is held by 23 hedge funds, with a total stake valued at $406.96 million.
