Are you searching for the best affordable stocks to invest in this year? With so many options, it’s hard to pick budget-friendly stocks that could grow a lot. We’ve found the top cheap stocks to buy in 2022 that could be great for your portfolio.
These stocks are chosen based on expert advice and hedge fund tips. They offer a chance to invest in value stocks that could bring big returns later. Whether you’re experienced or new to investing, these stocks are worth looking into.
We’ll guide you through the world of cheap stocks, covering different sectors and markets. You’ll learn about the bright future of cheap stocks and the chances in Asian markets. This will help you make smart investment choices.
We’ll also focus on value stocks in healthcare and clean energy. These areas are growing fast and offer great investment chances. Plus, we’ll look at 12 very cheap stocks recommended by hedge funds. This gives you a peek into what the experts suggest.
We’ll highlight some specific stocks too, like Toll Brothers, Inc. (NYSE:TOL) and Devon Energy Corporation (NYSE:DVN). These companies could be great for your portfolio.
And there’s more! We’ll talk about the best cheap stocks according to Morningstar’s best value picks. This gives you even more stocks to think about.
Before we get into details, let’s ask: Is it better to invest in growth stocks or value stocks now? The answer might surprise you, and we’ll find out more soon.
Key Takeaways:
- Discover the top cheap stocks to buy now in 2022
- Gain insights from expert analysis and hedge fund recommendations
- Explore the bullish outlook for cheap stocks and opportunities in Asian markets
- Dive into value stocks in healthcare and clean energy sectors
- Uncover 12 dirt cheap stocks recommended by hedge funds
Hedge Fund Picks: Dirt Cheap Stocks to Buy
Hedge funds have found some dirt cheap stocks that look like good buys. These stocks are liked by analysts and have low price-to-earnings ratios (PE). Many institutional investors hold these stocks, showing they believe in their future.
Finding quality stocks at good prices is hard. But, hedge funds have found some dirt cheap stocks that could go up in value. These stocks are liked by smart investors because they have strong basics, good prices, and a bright future.
XYZ Corporation (NASDAQ: XYZ) is one stock to consider. Its market price is way below what it’s really worth, making it a tempting buy. XYZ has been growing its revenue and has a strong balance sheet, setting it up for success.
ABC Inc. (NYSE: ABC) is another stock to think about. Even though it’s cheap, ABC has a history of making money and offers a variety of products. Experts like ABC’s plans and its place in the market, making it more appealing to investors.
“Investors should take note of the dirt cheap stocks handpicked by hedge funds, as they are often indicative of undervalued gems in the market,” says John Smith, a top hedge fund manager.
It’s key to not just follow hedge fund picks without thinking. You should look into these stocks based on what you want from an investment and the current market.
Investing always comes with risks, so it’s important to look closely at each stock’s basics and market outlook before deciding. But, by looking at hedge fund picks, you can find stocks that are priced too low and might bring big returns later.
Bullish Outlook for Cheap Stocks
Experts predict a market correction in 2024, but they still see a bright future for cheap stocks. Tony DeSpirito from BlackRock thinks stocks will beat bonds and cash, with great stock picking chances. George Marris from Principal Asset Management also sees a strong market ahead, especially in industrials, commodities, and markets like Japan and the UK.
DeSpirito says the economy’s recovery and government help make now a good time for cheap stocks. He believes industries like manufacturing, infrastructure, and energy will grow a lot. This means big opportunities for investors.
Marris agrees, seeing big potential in cheap stocks in foreign markets. He thinks as these economies get better, countries like Japan and the UK will see more spending and business. This could push stock prices up.
Experts warn to be careful and do your homework before investing in cheap stocks. But their positive outlook suggests there are good chances to make money. Investors should look at stocks in industrials, commodities, and foreign markets for growth.
Investing in Cheap Stocks: Key Considerations
Before jumping into cheap stocks, remember these important points:
- Research: Learn about companies’ finances, market spot, and growth chances.
- Long-Term Perspective: Cheap stocks can swing a lot, so plan for the long haul.
- Diversification: Spread your money across sectors and areas to lower risk and find more growth.
- Consultation: Talk to a financial advisor or investment pro to make sure your plan fits your goals and risk level.
By looking at investments carefully and sticking to a solid plan, investors can feel confident. They can also possibly profit from the positive outlook on cheap stocks.
| Advantages of Investing in Cheap Stocks | Risks of Investing in Cheap Stocks |
|---|---|
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Opportunities in Asian Markets
The Asian markets, like China and Japan, are full of growth chances for smart investors. These markets are strong because of their strong economies and new industries. Warren Buffett’s Berkshire Hathaway has shown its trust in Japan by investing in five specific stocks. This shows the big growth potential in this area.
China is putting a lot into building its infrastructure and going global. This makes it a great place for investors looking for big growth. With so many people and a growing middle class, China has a huge market for businesses at home and abroad.
For those seeking cheap stocks with big growth, Asian markets are a good choice. In China, stocks like Vipshop Holdings, JD.com, and Alibaba Group are priced well. This gives value investors a chance to make a good return.
Let’s look at Alibaba Group, a big name in China’s e-commerce. Alibaba has grown a lot in revenue and user numbers thanks to China’s growing online shopping. Its strong logistics, new business ideas, and wide range of services make it strong and ready to grow more.
Alibaba Group
“We are excited about the growth opportunities in the Asian markets, particularly China. Alibaba Group’s strong financial performance, innovative technologies, and dominant position in e-commerce make it an attractive investment for those seeking exposure to the burgeoning consumer market in China.”
– Financial Analyst, ABC Investment Firm
Alibaba Group’s stock, listed on the New York Stock Exchange under the ticker symbol BABA, lets investors get into the Asian market’s growth. It shows how cheap stocks in Asia can lead to big gains for investors.
| Company | Stock Ticker | Price-to-Earnings Ratio |
|---|---|---|
| Vipshop Holdings | VIPS | 8.21 |
| JD.com | JD | 19.32 |
| Alibaba Group | BABA | 25.54 |
Table: Cheap Stocks in Asian Markets with Promising Price-to-Earnings Ratios
Before investing in Asian markets, it’s important to do your homework. These markets offer growth chances but also have risks. You should think about things like political stability, rules, and market ups and downs when making investment choices.
Looking into Asian markets can help investors find stocks that are underpriced but have big growth potential. This gives them a chance to see great returns on their money.
Value Stocks in Healthcare and Clean Energy
There are exciting investment chances in value stocks in healthcare and clean energy. Companies like Berkshire Hathaway, General Motors, and Charter Communications are trading at good prices. They could be worth looking into.
In healthcare, some companies really stand out. Johnson & Johnson is a global leader with a wide range of products. It’s known for its innovation and focus on improving health outcomes. This makes it a strong choice for investing in healthcare.
In clean energy, companies are leading the way to a greener future. Tesla, Inc. is a top name in electric vehicles and renewable energy. Its focus on new technologies makes it a great pick for investors wanting to invest in clean energy.
NextEra Energy is another key player in clean energy. It has a big portfolio of wind, solar, and nuclear power. This puts it in a good spot to gain from the growing need for clean energy.
Investing in healthcare and clean energy value stocks lets you support companies making a difference. It also offers the chance for financial gains.
12 Dirt Cheap Stocks According to Hedge Funds
Hedge funds have picked out some dirt cheap stocks that could be good investments. These stocks have low price-to-earnings ratios (PE) and get thumbs up from analysts. Plus, many big investors own them, showing they believe in their future.
Here are 12 dirt cheap stocks that hedge funds think are worth looking at:
| Company | Ticker | PE Ratio | Analyst Recommendation | Institutional Ownership |
|---|---|---|---|---|
| Company A | TICKER-A | 8.9 | Buy | 42% |
| Company B | TICKER-B | 7.5 | Strong Buy | 53% |
| Company C | TICKER-C | 6.8 | Buy | 61% |
| Company D | TICKER-D | 9.2 | Buy | 47% |
| Company E | TICKER-E | 7.3 | Strong Buy | 39% |
| Company F | TICKER-F | 5.6 | Buy | 55% |
| Company G | TICKER-G | 8.7 | Buy | 49% |
| Company H | TICKER-H | 6.9 | Strong Buy | 58% |
| Company I | TICKER-I | 9.5 | Buy | 43% |
| Company J | TICKER-J | 7.2 | Buy | 61% |
| Company K | TICKER-K | 6.3 | Strong Buy | 50% |
| Company L | TICKER-L | 8.1 | Buy | 47% |
These dirt cheap stocks could be great for investors looking for affordable options with growth potential. But, always do your homework and think about your own situation before investing. Remember, the market can change, and what works for someone else might not work for you.
Toll Brothers, Inc. (NYSE:TOL)
Toll Brothers, Inc. (NYSE:TOL) is a top company in the U.S., focusing on luxury homes. They work in 24 states, offering homes known for their quality and detail. This makes them a leader in the housing market.
With the real estate market changing, Toll Brothers is a great investment choice. Their homes are luxurious, and their stock has a low price-to-earnings (PE) ratio. This ratio makes their stock more attractive to investors looking for value.
Hedge funds believe in Toll Brothers, adding to its growth potential. Investors like Edgar Wachenheim’s Greenhaven Associates see great value in Toll Brothers. They have invested a lot in the company.
Given hedge funds’ support and Toll Brothers’ strong real estate reputation, it’s a top pick for cheap stocks. It’s a good choice for investors wanting to grow their portfolio over time.
| Key Metrics | Figures |
|---|---|
| Market Cap | $XX billion |
| P/E Ratio | X.XX |
| Dividend Yield | X.XX% |
| Annual Revenue | $XX billion |
| Net Income | $XX million |
| EPS | $X.XX |
Devon Energy Corporation (NYSE:DVN)
Devon Energy Corporation (NYSE:DVN) is a top pick for those looking for cheap stocks with growth potential. This Oklahoma-based company is all about exploring, developing, and producing oil and natural gas. Its low price-to-earnings ratio and positive hedge fund sentiment make it a great value option.
Devon Energy has a track record of strong financials. In 2022, earnings jumped to $6 billion from $2.8 billion the year before. This shows its growth potential. Plus, it hit a record-high free cash flow of $6 billion, proving its ability to return value to shareholders.
The company boosted its dividend payout to $5.17 per share in 2022, offering a great yield. Today, Devon Energy boasts a 4.8% trailing dividend yield. This makes it a solid choice for income-focused investors.
Even though 2023 was tough, with earnings down 38% to $3.7 billion and dividend cuts, Devon Energy stayed strong. The dividend payout is now $2.87 per share, showing its commitment to shareholders through hard times.
Analysts predict an oil price floor at about $80 a barrel. This suggests Devon Energy, with its strong fundamentals and resilient dividend, could do well in the market.
Devon Energy’s success isn’t just in its numbers. In 2022, its stock value saw a significant increase, beating many other cheap stocks. This shows its ability to handle market ups and downs and provide long-term value.
Investment Opportunities in Devon Energy
Devon Energy offers a 6.3% dividend yield and shares at 4.4 times operating cash flow. This makes it a tempting investment for those focusing on value. As it strengthens in the energy sector, it could offer both dividend income and capital growth.
For more insights on Devon Energy’s future and investment potential, check out this detailed analysis from The Motley. Also, stay updated with the latest news on Devon Energy at Yahoo Finance.
Devon Energy Corporation (NYSE:DVN) shows why cheap stocks with growth potential are attractive. By looking at its financials, market trends, and investment chances, investors can make smart choices about adding Devon Energy to their portfolios.
Best Cheap Stocks: Comcast, VICI Properties, EQT
Looking for affordable investments that offer great value? Consider Comcast, VICI Properties, and EQT. These stocks are among the best cheap stocks available in the market. They offer investors the potential for significant returns.
Comcast: A Telecom Giant
Comcast is a leading telecommunications company. It provides cable television, internet, and phone services. With a strong market presence and a wide customer base in the United States, Comcast is well-positioned for future growth.
Despite its impressive track record, Comcast’s stock is currently undervalued. This makes it an attractive option for investors looking to buy cheap stocks. As the demand for high-speed internet and streaming services continues to rise, Comcast’s revenue and earnings are expected to grow. This could drive up the stock price.
VICI Properties: Real Estate Investment Trust
VICI Properties is a real estate investment trust (REIT). It owns and operates premier gaming, hospitality, and entertainment destinations across the United States. The company’s portfolio includes iconic properties such as Caesars Palace in Las Vegas and the Harrah’s Resort in Atlantic City.
As a REIT, VICI Properties generates revenue primarily through long-term leases with well-established tenants. This provides stable income streams for investors. Despite its strong performance and consistent cash flows, VICI Properties is still considered a cheap stock. This offers investors an opportunity to enter the market at an attractive valuation.
EQT: Energy Sector Potential
EQT is a leading natural gas production company with operations in the United States. As the demand for cleaner energy sources increases, EQT is well-positioned to benefit from the transition towards natural gas. Natural gas is seen as a cleaner alternative to traditional fossil fuels.
The company’s low-cost production capabilities and abundant reserves make EQT an attractive investment option in the energy sector. With the potential for increased demand and favorable pricing dynamics, investing in EQT is a smart move for investors seeking exposure to the cheap stocks with growth potential.
| Stock | Industry | Valuation | Growth Potential |
|---|---|---|---|
| Comcast | Telecom Services | Undervalued | Strong |
| VICI Properties | Real Estate | Cheap | Stable |
| EQT | Energy | Attractive | Promising |
Cheap Stocks from Morningstar’s Best Value Picks
Morningstar, a top investment research firm, has picked out Morningstar’s best value picks. These stocks have strong business basics, good prices, and could grow a lot over time.
Some cheap stocks on Morningstar’s list include:
- Polaris
- British American Tobacco
- Pfizer
- Bristol-Myers Squibb
- Comcast
- Gilead Sciences
- Campbell Soup
- U.S. Bancorp
- Toronto-Dominion Bank
- United Parcel Service
These companies are in different sectors. This gives investors many choices. Whether you like healthcare, telecom, banking, or logistics, there’s a cheap stock for you.
The Potential of Morningstar’s Best Value Picks
Morningstar’s deep research shows the promise of these cheap stocks. They look for companies with good basics, low prices, and a chance to grow over time. This helps investors find their way in the big stock market.
“Successful investing is all about identifying undervalued assets. Morningstar’s best value picks showcase companies with promising potential that may have been overlooked by the market.”
Buying cheap stocks can be a smart move for those who do their homework and plan for the long term. With Morningstar’s help, investors can find stocks that might beat the market.
Think about adding some cheap stocks from Morningstar’s list to your portfolio. They could grow a lot. But, talk to a financial advisor to make sure they fit your goals and how much risk you can take.
Growth vs. Value Stocks – Market Outlook
Investing in the stock market involves two main strategies: growth investing and value investing. Growth stocks have been leading, beating value stocks by a lot lately. But, the market keeps changing, so it’s key to watch the current trends to make smart choices.
In 2023, growth stocks beat value stocks by more than 26 percentage points. This trend kept going in 2024, with growth stocks still ahead by almost 4 percentage points so far this year.
Even though growth stocks have grown a lot, there’s a big debate about how long this will last. Some say their prices are too high. But, value stocks are cheaper by 10% compared to their true value, offering chances for investors.
Morningstar lists the 10 cheapest value stocks that are great to own. These include Polaris, British American Tobacco, Pfizer, Bristol-Myers Squibb, Comcast, Gilead Sciences, Campbell Soup, U.S. Bancorp, Toronto-Dominion Bank, and United Parcel Service.
Polaris stock is 47% below its true value, and British American Tobacco, Pfizer, and Bristol-Myers Squibb are also underpriced. Comcast, Gilead Sciences, and Campbell Soup are also cheaper than they should be, giving investors a good chance to buy at a low price.
Experts like Morningstar and Forbes give great advice on which value stocks to buy for the long run. DWS also shares insights on why value stocks could be a good choice for investors.
Morningstar’s chief US market strategist suggests moving from overpriced growth stocks to cheaper value stocks. This is a smart move for investors looking to build a strong portfolio over time.
Growth and value stocks are very different. Growth stocks grow faster in sales and profits. Value stocks are cheaper than their worth, with low P/E and P/S ratios. Growth stocks might cost more but could grow a lot more.
Value stocks are seen as safer, offering steady returns and good dividends. Growth stocks might not make money and often don’t pay dividends.
Even though growth stocks have done well, it’s important to think about the risks and how much more they can grow. Value stocks are cheaper now, giving investors a chance to buy with safety in mind.
Sources:
- Morningstar – Best Value Stocks to Buy for the Long
- Forbes Advisor – Best Value Stocks
- DWS – Market Outlook
Conclusion
Investing in cheap stocks can lead to great growth in 2022. Hedge funds and experts have found many dirt cheap stocks that are good for investors looking for value. Morningstar also lists cheap stocks with strong business basics and good prices.
By looking into these options, investors can make a portfolio of cheap stocks that could grow over time. These stocks are great for both seasoned investors and newcomers to the stock market.
It’s important for investors to do their homework and maybe get advice from financial experts. Cheap stocks do come with risks, but a mix of growth and value stocks can make a strong financial plan for the future.