On August 30, Ryan Detrick, Carson Group chief market strategist, joined ‘Closing Bell’ on CNBC and noted that we’re in a bull market, but seasonal weakness wouldn’t be shocking. Detrick acknowledged that September has historically been the worst month for the market, citing data showing that it’s the worst on average for the last 10 to 20 years, and even since 1950. Additionally, it ranks as the third-worst month in a post-election year. He notes that while it’s rare for both August and September to be positive in a post-election year, it’s not unprecedented. Despite the seasonal weakness, he believes a bull market is still in place and any potential downturn will be contained, likely a 4% to 6% pullback after a 30% rally and a 4-month winning streak. Detrick explained his bullish stance by emphasizing the market’s internal messages and underlying health. He pointed to the strong performance of high-beta stocks and consumer discretionary relative to staples, which are making new lows. This indicated that investors are still on the offensive side of the market.
Detrick also recommended remaining overweight in industrials, financials, and technology. While he acknowledged the rally in small caps, he cautioned against being overweight in them. He explained his reasoning by referencing core PCE, which is the Fed’s preferred inflation gauge, and noted that 45% of the 178 components of core PCE are above 3%, up from 40% at the start of the year. This may lead the Fed to cut rates fewer times than the 6 cuts currently priced in over the next 16 months. He believes the Fed will cut rates in 2.5 weeks because the labor market is weakening, but he only expects a couple more cuts this year. He concluded that with inflation still a concern, it’s best to stick with the large-cap stocks that have performed well.
That being said, we’re here with a list of the 10 best inexpensive stocks to buy according to hedge funds.
Methodology
We used the Finviz stock screener to compile a list of the top stocks with a forward P/E ratio of 20 or less, as of September 8. We then selected the 10 best inexpensive stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q2 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 Inexpensive Stocks to Buy According to Hedge Funds
10. Hewlett Packard Enterprise Company (NYSE:HPE)
Forward P/E Ratio as of September 8: 10.41
Number of Hedge Fund Holders: 60
Hewlett Packard Enterprise Company (NYSE:HPE) is one of the best inexpensive stocks to buy according to hedge funds. On September 4, Susquehanna analyst Mehdi Hosseini raised the firm’s price target on Hewlett Packard Enterprise Company to $21 from $16, while keeping a Neutral rating on the shares. The firm updated its estimates following the company’s Q3 2025 earnings, which included the contribution from the Juniper Networks acquisition.
Hewlett Packard Enterprise achieved a total revenue of $9.1 billion, which was an 18% increase year-over-year, which was driven by the AI, networking, and hybrid cloud segments. The acquisition of Juniper, which was completed on July 2 this year, is expected to generate at least $600 million in cost synergies over the next 3 years.
The networking segment, which now includes Juniper, was a major driver, with revenue increasing by 54% year-over-year to $1.7 billion and contributing ~50% to HPE’s non-GAAP consolidated operating profit. The server segment also performed well, with revenue of $4.9 billion, a 16% increase, and AI systems revenue reaching an all-time high of $1.6 billion. AI orders nearly doubled sequentially, and the company has a record AI backlog of $3.7 billion.
Hewlett Packard Enterprise Company (NYSE:HPE) provides solutions that allow customers to capture, analyze, and act upon data seamlessly in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan.
9. The Allstate Corporation (NYSE:ALL)
Forward P/E Ratio as of September 8: 8.73
Number of Hedge Fund Holders: 62
The Allstate Corporation (NYSE:ALL) is one of the best inexpensive stocks to buy according to hedge funds. On September 4, the Big 12 Conference and Allstate announced a multi-year partnership to launch the Allstate Championship Series. The new platform is designed to be a year-round celebration of Big 12 Championships and student-athletes.
The Allstate Championship Series will be the foundation for the Allstate Commissioner’s Cup, which is an award given annually to the Big 12 school with the most “points” based on performance in conference championships, graduation rates, academic and student services, and community engagement. As part of the agreement, Allstate will become the presenting sponsor of all Big 12 Olympic sport championships and will be integrated into marquee events like the Big 12 Football Championship and the Men’s and Women’s Basketball Championships.
The partnership also includes digital and in-venue branding at all Big 12 Championships, original content showcasing student-athlete leadership, and the designation of Allstate as the “Official Insurance Partner of the Big 12 Conference” for home, auto, and property insurance.
The Allstate Corporation (NYSE:ALL) provides property and casualty, and other insurance products in the US and Canada. It has 5 segments: Allstate Protection, Run-off Property-Liability, Protection Services, Allstate Health & Benefits, and Corporate & Other.
