In this article, we will look at the 10 Best Cheap Stocks to Buy for Beginners.
On June 2, Ben Snider, chief U.S. equity strategist at Goldman Sachs, appeared on CNBC’s ‘Squawk on the Street’ to talk about the latest market trends and the firm’s S&P 500 target, among other things.
He was of the view that this is an incredibly dynamic market environment, with lots of uncertainty. But it is important to note that one way the market has dealt with uncertainty, not just this year but the last few years of the AI boom, is to really focus on near-term visible earnings. That means that if earnings strength continues, and his view is that it will, the market should continue to move higher.
READ ALSO: Top 10 Undervalued Blue Chip Stocks Analysts Recommend for Smart Investing AND 10 Best Tech Stocks Under $5 to Buy.
Talking about his S&P numbers for this year and the next, Snider stated that he has 24% earnings growth this year and 13% next year. He believes there is a concentrated group delivering the increase, with half of the earnings growth being driven by the AI infrastructure beneficiaries alone. He added that if you look at a bottom-up basis, one can argue that just two or three of the largest semiconductor companies are accounting for over a third of that growth.
With these broader market trends in view, let’s look at the best cheap stocks to buy for beginners.
Our Methodology
We used the Finviz stock screener to identify the best stocks for beginners with a forward P/E below 15. We then selected the top 10 stocks most popular among hedge funds as of Q1 2026, using the hedge fund sentiment data from Insider Monkey’s database. The stocks are arranged in ascending order of hedge fund sentiment.
Note: All data was recorded on June 3.
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. Insider Monkey’s quarterly newsletter strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10 Best Cheap Stocks to Buy for Beginners
10. Toyota Motor Corporation (NYSE:TM)
Number of Hedge Fund Holders: 20
Toyota Motor Corporation (NYSE:TM) is one of the best cheap stocks to buy for beginners. Toyota Motor Corporation (NYSE:TM) announced on June 3 that Toyota Racing will conduct the first public demonstration drives of its liquid hydrogen-fuelled TR LH2 Racing Prototype in the build-up to the 94th edition of the Le Mans 24 Hours next week. The company further reported that the TR LH2 Racing Prototype is based on the same chassis as the TR010 Hybrid Hypercar, which is set to compete in the Le Mans 24 Hours on 13-14 June, and is intended to advance the development of hydrogen technology in motorsports.
In a separate development, Reuters reported on May 28 that, according to a report by Toyota Motor Corporation (NYSE:TM) released on Thursday, the company’s global vehicle sales dropped for a third consecutive month in April, hit primarily by sharp declines in the Middle East and China. It further clarified that global sales fell 3.1% from the prior year period to 849,306 vehicles, while overseas sales dropped 7.5%. However, sales in Japan grew 24.2%, rebounding after earlier purchase delays that took place ahead of an environmental tax change.
Toyota Motor Corporation (NYSE:TM) manufactures and sells motor vehicles and parts. The company’s operations are divided into the following segments: Automotive, Financial Services, and All Other.
9. Novartis AG (NYSE:NVS)
Number of Hedge Fund Holders: 31
Novartis AG (NYSE:NVS) is one of the best cheap stocks to buy for beginners. Novartis AG (NYSE:NVS) announced on June 3 new Cosentyx® data in polymyalgia rheumatica showing a statistically significant, clinically meaningful difference in sustained remission rates compared to placebo, and significant steroid sparing. Management reported that the Phase III REPLENISH data highlighted that the effect of Cosentyx treatment was sustained through week 52 in this investigational use, with the data published simultaneously in the New England Journal of Medicine and presented at the 2026 European Alliance of Associations for Rheumatology (EULAR) Congress.
Novartis AG (NYSE:NVS) further reported that the REPLENISH trial met all primary and secondary endpoints across both Cosentyx 300mg and 150mg treatment arms, including complete sustained remission and time until patients needed additional treatment through week 52. It also stated that no new safety signals were identified in PMR patients receiving Cosentyx. Prof Christian Dejaco, Director, Dept of Rheumatology, South Tyrol Health Trust, Bruneck, Italy, stated that they are “encouraged by the REPLENISH trial results which showed that Cosentyx, with its known safety profile, can reduce flares in the longer term while lowering patients’ steroid exposure.”
Headquartered in Basel, Switzerland, Novartis AG (NYSE:NVS) develops, markets, and manufactures a range of healthcare and pharmaceutical products, and is also involved in immuno-oncology research. Its operations span the Innovative Medicines, Sandoz, and Corporate segments.
8. The Toronto-Dominion Bank (NYSE:TD)
Number of Hedge Fund Holders: 33
The Toronto-Dominion Bank (NYSE:TD) is one of the best cheap stocks to buy for beginners. Scotiabank lifted the price target on The Toronto-Dominion Bank (NYSE:TD) to C$165 from C$150 on June 1 and maintained an Outperform rating on the shares. The company also received a rating update from Barclays on May 29, with the firm lifting the price target on The Toronto-Dominion Bank (NYSE:TD) to C$140 from C$135 while maintaining an Underweight rating on the shares. The rating updates came after the bank reported financial results for fiscal Q2 2026.
In its financial results for the quarter ended April 30, 2026, The Toronto-Dominion Bank (NYSE:TD) announced that reported diluted earnings per share were $2.43, compared with $6.27 in the prior year period, while adjusted diluted earnings per share were $2.38, compared to $1.97 in fiscal Q2 2025. Reported net income for the quarter was $4,251 million, compared with $11,129 million, with the adjusted net income reaching $4,168 million, compared with $3,626 million in the prior year period.
The Toronto-Dominion Bank (NYSE:TD) provides financial products and services. Its operations are divided into the following segments: Canadian Personal and Commercial Banking, U.S. Retail, Wealth Management and Insurance, Wholesale Banking, and Corporate segment.
7. Amgen Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 65
Amgen Inc. (NASDAQ:AMGN) is one of the best cheap stocks to buy for beginners. Amgen Inc. (NASDAQ:AMGN) announced on June 1 that the European Commission granted marketing authorization for IMDYLLTRA® (tarlatamab) as a monotherapy for the treatment of adults with extensive-stage small cell lung cancer who require systemic therapy following disease progression on or after first-line treatment with platinum-based chemotherapy. Management reported that the approval was based on results from DeLLphi-304, which is the first global Phase 3 trial to exhibit a significant survival benefit over chemotherapy in this setting.
Jean-Charles Soria, senior vice president of Oncology at Amgen Inc. (NASDAQ:AMGN), stated that IMDYLLTRA is the first and only T-cell engager therapy approved to treat small cell lung cancer, and the approval by the European Commission marks a critical step forward for patients in Europe.
Amgen Inc. (NASDAQ:AMGN) further reported that DeLLphi-304, the global Phase 3 clinical trial, showed that “IMDYLLTRA reduced the risk of death by 40% and significantly extended median overall survival (OS) by more than five months compared to standard of care (SOC) chemotherapy as a treatment for patients with ES-SCLC who progressed on or after one line of platinum-based chemotherapy”.
Amgen Inc. (NASDAQ:AMGN) is a biotechnology company that discovers, develops, manufactures, and markets human therapeutics. It delivers new therapies for patients with complex cancers, especially in areas with significant unmet needs.
6. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 72
AT&T Inc. (NYSE:T) is one of the best cheap stocks to buy for beginners. Oppenheimer upgraded AT&T Inc. (NYSE:T) to Perform from Outperform on June 3, saying that the firm believes longer-term broadband subscriber growth and, eventually, mobile is at risk from the growing threat of satellite LEO constellations. It added that while AT&T Inc. (NYSE:T) has the most broadband exposure relative to telco peers, it is less exposed than the cable service providers. Oppenheimer also stated that it is set to build 7M new fiber passings this year, as well as 5M annually thereafter to get to 60M-plus total locations by 2030. According to the firm, the penetration will disappoint, and AT&T Inc. (NYSE:T) may stop at 50M homes.
In a separate development, In a separate development, AT&T Inc. (NYSE:T) announced on May 14 a joint agreement with T-Mobile and Verizon to form a new JV aimed at helping end wireless dead zones in the United States, which includes rural areas. The JV plans to do so by pooling limited spectrum resources to raise capacity, enhance customer experience, and help satellite providers to reach more customers through a unified platform. Management reported that the JV remains subject to negotiations between the parties to reach definitive agreements, as well as to satisfying customary closing conditions.
AT&T Inc. (NYSE:T) provides telecommunications and technology services and operates through the Communications and Latin America segments. Its Communications segment offers wireline telecom, wireless, and broadband services in the US and globally, while the Latin America segment manages services in Mexico.
While we acknowledge the potential of T to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than T and that has 100x upside potential, check out our report about the cheapest AI stock.
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