We recently compiled a list of the 10 Best Stocks Under $50 to Buy Right Now. In this article, we are going to take a look at where United States Steel Corporation (NYSE:X) stands against the other stocks.
From a certain perspective, domestic equities are off to a strong start this year. Despite a large selloff on February 21, the S&P 500 has gained a healthy 2.2% in less than two months, and the Nasdaq Composite and Dow Jones Industrial Average are not far behind. If they can keep this momentum going, they’re probably in for another successful year. Looking at the market in detail however, US stock indexes appear to be riding the coattails of the significant lead they built up after Trump’s election on November 5 last year, much unlike their overseas competitors. According to JPMorgan, the relative underperformance of US stocks this year represents a 10% – 20% reversal of the pro-US investment pattern seen from April 2023 until the end of last year. Furthermore, the current excitement around Chinese AI firm DeepSeek has caused investors to reconsider US equity values, making Chinese tech stocks more tempting in the short term.
Inflation expectations have also risen, with the one-year projected inflation rate for US consumers rising to 4.3% in February from 3.3% in January. This increase in inflation expectations, along with a slowing economy, has sparked fears about stagflation, which is characterized as stalled growth and rising prices. According to a Bank of America poll of global fund managers published on February 18, the number of investors expecting stagflation in the coming year has hit a seven-month high. At the same time, investors remained bullish on stocks, perceiving a trade war as a low-probability risk.
However, it would be foolish to rule out US stocks completely, given that US shares outperformed their international counterparts from the 2008 financial crisis to the end of 2024. Although international markets appear to be the hot place to be right now, analysts have much to like about US equities, particularly as S&P 500 companies report their most profitable quarter in years, with Wall Street projecting double-digit profit growth this year. According to Richard Ward, Chief Investment Officer of Curated Wealth Partners, overseas companies have performed better recently because stock pickers are seeking for bargains, not because of their fundamentals. Ward believes that investors should stay in US markets and look towards lower-cost sectors such as small caps and financials instead. He added:
“The US is the best place to be because we continue to benefit from innovation and a healthier economy.”
Our Methodology
For this list, we made use of stock screeners to note down companies with stocks that are trading at less than $50 per share. These companies were then narrowed down based on their popularity among hedge funds. The stocks on this list are ranked in ascending order based on hedge fund sentiment around them, as of Q4 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
An aerial view of an industrial plant manufacturing welded pipes and tubes from stainless steel and galvanized carbon.
United States Steel Corporation (NYSE:X)
Share Price as of February 20: $39.04
Number of Hedge Fund Holders: 63
United States Steel Corporation (NYSE:X) is a steel producer based in Pittsburgh, Pennsylvania. It distributes flat-rolled and tubular steel products to customers in a variety of industries, including automotive, construction, consumer, electrical, and industrial.
On February 5, BMO Capital Markets raised its outlook on United States Steel Corporation (NYSE:X), with analyst Étienne Ricard raising the price target to $55 from $52, while maintaining an Outperform rating on the company’s stock. Ricard’s study highlighted US Steel’s impressive fourth-quarter performance, with organic top-line growth of 17%, indicating a period of strong execution for the company. The analyst’s research stated that all four of US Steel’s high-growth divisions produced record results and now account for about half of the company’s total sales of $15.64 billion.
United States Steel Corporation (NYSE:X) is at an important point of late, with macroeconomic and geopolitical forces working in its favor, especially in light of President Trump’s tariffs on steel and aluminum imports. Moreover, the company recently completed a significant CAPEX cycle, with Big River 2 coming online, a plant that would cost $10 billion to build today, strengthening the company’s competitive position.
Overall X ranks 7th on our list of the stocks under $50 to buy right now. While we acknowledge the potential of X as an investment, 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 X but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure: None. This article is originally published at Insider Monkey.
