In this article, we will discuss the 10 Best Growth Stocks Under $20 to Buy.
On May 29, Scott Wren, Senior Global Market Strategist at Wells Fargo Investment Institute, joined BNN Bloomberg to discuss the markets. Wren attributed the market’s strong performance (which has exceeded expectations) largely to stellar earnings growth, noting that the economy might reach a 25 percent earnings growth rate for the year. He observed that the market currently seems indifferent to risks in the Strait of Hormuz and the Gulf, operating under the assumption that the situation in Iran will be of limited duration. While he acknowledged the conflict might last longer than initially expected, he noted that the market remains unconcerned about a long-term, ongoing crisis or a massive spike in oil prices.
Regarding the sustainability of the market rally, Wren stated that while stellar earnings are currently sufficient to maintain momentum, the upcoming Q2 reporting season leaves little margin for error. He noted that performance will depend not only on the large tech companies carrying the market but also on the downstream performance of the other 493 companies in the S&P 500. He also explained the rationale for favoring the utilities and industrials sectors to capitalize on the AI boom and infrastructure expansion. He noted that the growth of AI requires building massive data centers, which necessitates equipment like bulldozers and track hoes found in the industrial sector. Furthermore, he highlighted that power demand in the US is expected to increase by at least 25 percent (with some estimates reaching 50 percent) over the next 7 to 10 years, which will benefit utilities. He concluded that upgrading the power grid and supporting infrastructure will drive sustained performance for these sectors.
Our Methodology
We used screeners to identify stocks that have a record of delivering earnings growth and have grown their EPS by at least 20% over the past 3 years. We then selected stocks that are trading below $20 per share, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds
Note: All data was sourced on June 1.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10 Best Growth Stocks Under $20 to Buy
10. Aurora Innovation Inc. (NASDAQ:AUR)
Number of Hedge Fund Holders: 35
Aurora Innovation Inc. (NASDAQ:AUR) is one of the best growth stocks under $20 to buy. On May 6, Aurora Innovation and McLane Company entered an agreement to launch driverless commercial hauls in Texas using the Aurora Driver, an SAE L4 self-driving system. This partnership aims to streamline the movement of supplies and perishable food for major restaurant chains, building upon a supervised pilot program that began in 2023.
The transition to driverless operations between Dallas and Houston follows a successful pilot in which Aurora Innovation Inc. (NASDAQ:AUR) logged over 280,000 autonomous miles and delivered 1,400 loads with 100% on-time performance. Building on this success, the companies plan to expand autonomous routes across the US Sun Belt by the end of the year to further enhance distribution efficiency.
The collaboration uses a hybrid operational model where the Aurora Driver handles the long-haul “middle mile” while human drivers continue to manage local, last-mile deliveries. By providing scalable, 24/7 capacity, this autonomous integration helps address labor constraints and maintains consistent transit schedules, ensuring a more resilient and efficient supply chain for McLane’s extensive distribution network.
Aurora Innovation Inc. (NASDAQ:AUR) designs and develops automotive hardware, software, and data services, led by its AI-powered Aurora Driver system.
9. Wisdomtree Inc. (NYSE:WT)
Number of Hedge Fund Holders: 35
Wisdomtree Inc. (NYSE:WT) is one of the best growth stocks under $20 to buy. On May 14, WisdomTree launched the Physical AI, Humanoids, and Drones Fund/WDRN, an ETF offering exposure to companies applying AI to physical tasks. With a 0.45% expense ratio, the fund focuses on humanoid robotics, autonomous drones, smart manufacturing, and logistics automation, representing a shift from digital AI to real-world autonomous systems.
The fund targets five key verticals across the physical AI value chain, providing diversified global exposure. Using a rules-based, quarterly rebalanced index, WDRN aims to capture the emerging investment cycle as AI moves into industrial infrastructure, healthcare, and defense.
Management at Wisdomtree Inc. (NYSE:WT) describes this as a turning point in AI deployment. Investors should note that the fund involves risks unique to robotics and drone technologies, including intense competition, high R&D costs, and evolving regulatory environments.
Wisdomtree Inc. (NYSE:WT), based in New York, is a global asset manager and provider of investment solutions. For instance, the company is a leading provider of exchange-traded fund/ETF and exchange-traded product/ETP. Its asset class spans equities, currency, and digital assets.
