In this article, we will look at the 10 Best and Cheap Stocks to Buy Now.
On June 4 Morningstar released its June 2025 outlook, indicating that as of May 30, the US stock market was trading at a 3% discount to its fair value. This valuation was near the historic mid-point suggesting that the market was neither undervalued nor overvalued. David Sekera, CFA at Morningstar noted that in April the market experienced a drop to 17% discount to its fair value which the firm saw as a golden buying opportunity, thereby suggesting investors to overweight stocks. However, the market quickly rebounded after the 90-day pause, returning to market-weight positions.
Morningstar warns that the current calm in the market is like the “eye of the hurricane,” implying that despite recent stability, significant risks remain ahead. Key risks include ongoing uncertainties around trade tariffs and negotiations, which remain unresolved and could cause market volatility depending on news developments or geopolitical maneuvers. Additionally, economic growth is expected to slow over the coming quarters. The report highlights that the first quarter of 2025 showed a slight GDP contraction of around -0.3% due to pre-tariff surges. The second quarter GDP estimates remain strong however, analysts anticipate the growth rate to decelerate through the rest of 2025.
Based on the analysis Morningstar recommends investors overweight value stocks that are trading at a 14% discount to their fair value and underweight growth stocks that trade at a premium of 11% to their fair value.
With that let’s take a look at the 10 best and cheap stocks to buy now.
A business person consulting with their financial advisor showing their portfolio of stocks.
Our Methodology
To curate the list of the 10 best and cheap stocks to buy now, we used the Finviz stock screener and Seeking Alpha. Using the screener we aggregated a list of stocks trading below the forward P/E of 15. Next, we cross-checked each stock for forward P/E from Seeking Alpha. Lastly, we ranked these stocks based on the number of hedge fund holders, sourced from Insider Monkey’s Q1 2025 database. Please note that the data was recorded on June 20, 2025.
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).
10 Best and Cheap Stocks to Buy Now
10. Shell plc (NYSE:SHEL)
FWD P/E Ratio: 11.58
Number of Hedge Fund Holders: 50
Shell plc (NYSE:SHEL) is one of the 10 Best and Cheap Stocks to Buy Now. On June 22, Reuters reported that Shell plc (NYSE:SHEL) led the LNG Canada project to produce its first LNG to export in British Columbia. The LNG Canada project is a joint venture led by Shell with partners including Petronas, PetroChina, Mitsubishi Corporation, and Kogas.
This is a notable event as this startup comes ahead of the projected milestone. The company had earlier notified that it remains on track to produce its first shipment by the middle of this year. The LNG Canada facility is recognized as the first large-scale project to begin production and is also significant due to its direct access from North America to the Pacific coast.
The sources of Reuters added the project can produce 14 million metric tones per annum when fully operational. The project’s Train 1 facility started the first production, which has a capacity of 5.6 million metric tones per annum. The sources added that LNG tanker Gaslog Glasgow is said to be approaching the Kitimat port and is anticipated to arrive on June 29 to be loaded with the first batch.
Shell plc (NYSE:SHEL) is a global energy and petrochemical company engaged in the exploration, production, refining, and marketing of oil, natural gas, and chemicals.
9. The Goldman Sachs Group, Inc. (NYSE:GS)
FWD P/E Ratio: 14.32
Number of Hedge Fund Holders: 77
The Goldman Sachs Group, Inc. (NYSE:GS) is one of the 10 Best and Cheap Stocks to Buy Now. On June 20, Citi analyst Keith Horowitz maintained a Neutral rating on The Goldman Sachs Group, Inc. (NYSE:GS) with a price target of $550. The rating comes as the firm released its Q2 2025 earnings preview note regarding the company.
The Goldman Sachs Group, Inc. (NYSE:GS) released its Q1 2025 earnings results on April 14. The company delivered net revenue of $15.06 billion, reflecting a 6% year-over-year increase. The net income for the quarter came in at $4.74 billion with an annualized ROTE of 18%. Analyst Keith Horowitz acknowledged that the company is managing its main initiatives effectively. He noted Q1 results to be indicative of a clear line of sight towards 15% to 17% ROTCE.
In addition, Horowitz also highlighted his bull case suggesting the ROTCE range to increase further. Despite the bullish scenario, he remains cautious as The Goldman Sachs Group, Inc. (NYSE:GS) is trading above its historic valuations. He believes that to consider the company’s share to be attractively priced investors would have to assume a ROTCE of more than 18% and a significantly reduced risk profile, which Horowitz sees to be too far.
