7 Best Low Cost Stocks To Buy Under $50

1. Bank of America Corporation (NYSE:BAC)

Share Price: $39.40

Forward P/E Ratio: 12.12 

Earnings Growth This Year: 5.80%  

Number of Hedge Fund Holders: 92

Bank of America Corporation (NYSE:BAC) is the second-largest bank in the United States in terms of assets. It operates as a financial holding company that provides a range of banking services including deposits, cash management, and saving accounts among others.

The recent news of Berkshire Hathaway selling around 5.8 million shares of the company came in as a shock for its investors. As the reason behind the share sell-off was unknown, many investors wondered if it was a sign of the business of Bank of America Corporation (NYSE:BAC) going down.

What we know from the company’s earnings call and overall financial performance does not point towards a weak business it suggests that the bank is doing well financially. The second quarter of 2024 revealed that the bank added around 278,000 new checking accounts to its portfolio. Moreover, it also announced adding more than 6,000 new relationships in the wealth management segment.

The loan portfolio of the Bank of America Corporation (NYSE:BAC) also witnessed a 2% growth year-over-year to $1.91 billion. All these positive highlights overshadowed the flat revenue growth rate of 1% for the bank.

What’s more interesting about the stock is its cheap valuation. BAC is trading at only 12 times its forward earnings while analysts are expecting a 6% increase in its earnings during the year. This makes the banking stock one of the best low cost stocks to buy under $50.

Diamond Hill Large Cap Strategy stated the following regarding Bank of America Corporation (NYSE:BAC) in its Q2 2024 investor letter:

“Other top contributors in Q2 included Bank of America Corporation (NYSE:BAC) and Extra Space Storage. Shares of financial services company Bank of America rose in the quarter as it looks increasingly likely net interest income will inflect and begin growing again in 2024’s back half and into 2025.”

While we acknowledge the potential of Bank of America Corporation (NYSE:BAC) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for a promising AI stock that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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