In this article, we discuss the 10 Most Undervalued Value Stocks to Buy Now.
Expectations of easing inflation resulted in renewed hopes that the Federal Reserve could potentially cut interest rates as soon as next month. As a result, U.S. stocks surged to record highs on August 12, with the S&P 500 climbing 1.13% to 6,445.76 and the NASDAQ Composite rising 1.39% to 21,681.90. Both indices closed at their all-time highs. Meanwhile, the Dow experienced an uptick of 483 points, while small-cap stocks in the Russell 2000 led the charts. The Russell 2000 index gained three times as much as the S&P.
Meanwhile, the July Consumer Price Index recorded an increase of 2.7% year-over-year, which was slightly below forecasts. Core CPI, however, increased by 3.1%, which was just above expectations. The overall statistics eased market speculations about growing inflation due to President Donald Trump’s ongoing tariff policies. At the same time, the report reinforced the case for rate cuts. The probability of a rate cut occurring in September now sits at 94%, up from 85% before the data.
Thus, borrowing costs are heading lower and earnings momentum is improving, building the case for equities, particularly undervalued stocks poised to benefit from both economic resilience and monetary easing. With this backdrop in mind, let’s jump to our list of the 10 Most Undervalued Value Stocks to Buy Now.
A bustling cityscape with a busy financial district, representing the growth of the investment fund.
Our Methodology
To curate our list of the 10 Most Undervalued Value Stocks to Buy Now, we used the Finviz screener to extract a list of companies trading under a forward price-to-earnings multiple of 16x. Next, we ranked these stocks based on the number of hedge funds holding stakes in the respective stocks as of Q1 2025. To gauge hedge fund sentiment across these stocks, we relied on Insider Monkey’s hedge fund database, which tracks over 1,000 hedge funds.
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. QUALCOMM Incorporated (NASDAQ:QCOM)
Forward Price-to-Earnings: 12.22
Number of Hedge Fund Holders: 82
With strong hedge fund interest and a low price-to-earnings ratio, QUALCOMM Incorporated (NASDAQ:QCOM) secures a place on our list of the 10 Most Undervalued Value Stocks to Buy Now.
On July 31, 2025, Benchmark reaffirmed its ‘Buy’ rating and $200 price target on QUALCOMM Incorporated (NASDAQ:QCOM). This reiteration comes despite a dip in after-hours trading. The bullish stance is attributed to the company’s strong quarterly results, where the Automotive segment recorded 21% year-over-year growth. The IoT segment climbed 24%, while the Handsets segment recorded a 7% growth, thanks to strong Snapdragon 8 Elite demand in premium devices.
Despite the eventual loss of Apple business, the investment firm highlighted QUALCOMM Incorporated (NASDAQ:QCOM)’s diversification strategy, which resulted in the Automotive segment’s quarterly contribution of $1 billion and the IoT segment’s contribution of $1.7 billion. The analyst believes the after-hours dip was due to the company’s EPS guidance, which failed to surpass Street’s estimates.
Operating across Chipset, Technology Licensing, and Strategic Investment segments, QUALCOMM Incorporated (NASDAQ:QCOM) delivers foundational wireless technologies. It is included in our list of the most undervalued value stocks to buy.
9. AT&T Inc. (NYSE:T)
Forward Price-to-Earnings: 13.55
Number of Hedge Fund Holders: 87
AT&T Inc. (NYSE:T) is included in our list of the 10 Most Undervalued Value Stocks to Buy Now.
On August 11, 2025, AT&T Inc. (NYSE:T) announced that it was named No. 1 in Customer Satisfaction for Medium Business and Large Enterprise Internet Service in the J.D. Power 2025 Business Internet Satisfaction Study. This is the company’s eighth consecutive win for Large Enterprise and third consecutive win for Medium Business, highlighting its leading reputation for delivering high-performance fiber and 5G connectivity to over 2.5 million enterprises globally.
Meanwhile, on July 31, 2025, AT&T Inc. (NYSE:T) announced its dual listing on NYSE Texas, effective August 1, 2025. The company will retain its primary NYSE listing. This achievement enhances investor access in a pro-business market.
With its Communication and Latin America segments, AT&T Inc. (NYSE:T) offers telecommunications and technology services globally. It is included in our list of the most undervalued value stocks to buy.
8. Wells Fargo & Company (NYSE:WFC)
Forward Price-to-Earnings: 13.59
Number of Hedge Fund Holders: 88
With strong hedge fund interest and a low price-to-earnings ratio, Wells Fargo & Company (NYSE:WFC) secures a place on our list of the 10 Most Undervalued Value Stocks to Buy Now.
On August 4, 2025, Wells Fargo & Company (NYSE:WFC) strategically collaborated with the National Center for the Middle Market (NCMM) at The Ohio State University’s Fisher College of Business. With this collaboration, WFC will provide NCMM with insights into the banking needs of middle market companies through its Commercial Banking group.
This development follows the NCMM’s July 30 release of its 2025 Mid-Year Middle Market Indicator (MMI). NCMM’s MMI reported that middle market companies’ revenue is at its lowest since the pandemic. Furthermore, slowing hiring intentions, falling economic confidence, and ongoing concerns over inflation, policy uncertainty, and trade impacts were noted.
Wells Fargo & Company (NYSE:WFC) will enhance NCMM’s research and thought leadership, providing actionable data to navigate evolving economic challenges.
Wells Fargo & Company (NYSE:WFC), a leading financial services company, offers diversified banking, investment, mortgage, and commercial finance solutions. It is included in our list of the most undervalued value stocks to buy.
7. EQT Corporation (NYSE:EQT)
Forward Price-to-Earnings: 15.72
Number of Hedge Fund Holders: 91
EQT Corporation (NYSE:EQT) is included in our list of the 10 Most Undervalued Value Stocks to Buy Now.
On July 27, 2025, Piper Sandler maintained its ‘Neutral’ rating on EQT Corporation (NYSE:EQT), raising its price target from $48 to $49. The price revision is attributed to a boost in the company’s positioning, driven by Appalachia’s long-term gas demand. New gas supply contracts and infrastructure investments will contribute $250 million in free cash flow by FY2029, the analyst noted. This inflow will be preceded by $1 billion in upfront costs.
Meanwhile, Evercore ISI reaffirmed its ‘Buy’ rating on EQT Corporation (NYSE:EQT) with a $60 target on July 31. Additionally, Jefferies also maintained its ‘Buy’ rating with a $70 target on August 2. Despite the short-term market pressures from strong domestic supply and seasonal storage builds, these targets highlight the company’s long-term growth outlook.
Operating across the Appalachian Basin, EQT Corporation (NYSE:EQT) is a leading U.S. natural gas producer. It is included in our list of the most undervalued value stocks to buy.
6. PayPal Holdings, Inc. (NASDAQ:PYPL)
Forward Price-to-Earnings: 13.64
Number of Hedge Fund Holders: 92
With strong hedge fund interest and a low price-to-earnings ratio, PayPal Holdings, Inc. (NASDAQ:PYPL) secures a place on our list of the 10 Most Undervalued Value Stocks to Buy Now.
Following the company’s Q2 earnings release, Mizuho reduced its price target on PayPal Holdings, Inc. (NASDAQ:PYPL) from $87 to $84 on July 30, 2025. The analyst attributed the price revision to a slight dip in branded checkout growth and softer-than-expected transaction margin dollar guidance for the second half of 2025. Meanwhile, the company’s core PayPal button business delivered strong performance when “Buy Now Pay Later” and “Pay with Venmo” segments are included. The latter segment is estimated to deliver 1.5 times the company-wide transaction margin.
Furthermore, Barclays maintained its ‘Buy’ rating on PayPal Holdings, Inc. (NASDAQ:PYPL) on July 30 with a $90 target, and Needham maintained a ‘Hold’ rating the same day. Needham cited short-term e-commerce headwinds and modest EPS growth expectations.
With its global technology platform, PayPal Holdings, Inc. (NASDAQ:PYPL) allows consumers to send, receive, and manage digital payments through multiple funding sources and channels. It is included in our list of the most undervalued value stocks to buy.
5. Merck & Co., Inc. (NYSE:MRK)
Forward Price-to-Earnings: 8.96
Number of Hedge Fund Holders: 93
Merck & Co., Inc. (NYSE:MRK) is included in our list of the 10 Most Undervalued Value Stocks to Buy Now.
On August 12, 2025, Merck & Co., Inc. (NYSE:MRK) announced an update regarding its Phase 3 KEYNOTE-905 trial. According to the update, the trial met its primary and key secondary endpoints in patients with muscle-invasive bladder cancer (MIBC) who are ineligible for cisplatin-based chemotherapy.
The study revealed improved event-free survival, overall survival, and pathologic complete response rates compared to surgery alone. The improved outcome was a result of giving patients KEYTRUDA (pembrolizumab) and Padcev (enfortumab vedotin-ejfv) medicines before and after surgery.
The trial, carried out in collaboration with Pfizer and Astellas, marks the first systemic treatment that enhances survival rates in this patient group. Furthermore, no new side effects were observed.
Operating through its Pharmaceutical and Animal Health segments, Merck & Co., Inc. (NYSE:MRK) leads as a healthcare company worldwide. It is included in our list of the most undervalued value stocks to buy.
4. Micron Technology, Inc. (NASDAQ:MU)
Forward Price-to-Earnings: 10.16
Number of Hedge Fund Holders: 96
With strong hedge fund interest and a low price-to-earnings ratio, Micron Technology, Inc. (NASDAQ:MU) secures a place on our list of the 10 Most Undervalued Value Stocks to Buy Now.
On August 12, 2025, Cantor Fitzgerald reiterated its ‘Overweight’ rating on Micron Technology, Inc. (NASDAQ:MU) with a $155 price target. This reaffirmation follows the company’s raised guidance for its August quarter.
Furthermore, the analyst highlighted the improving outlook for DRAM supply and demand, driving its bullish stance. Meanwhile, continued improvements in the NAND market are also noted. At the same time, Micron Technology, Inc. (NASDAQ:MU)’s ongoing efforts to deliver premium memory and storage solutions fuel the analyst sentiment. Lastly, the analyst dismissed the concerns about High Bandwidth Memory (HBM), stating its pricing and margins are “overdone.”
Primarily operating across the United States, Taiwan, Singapore, Japan, Malaysia, China, and India, Micron Technology, Inc. (NASDAQ:MU) manufactures and sells memory and storage products. It is included in our list of the most undervalued value stocks to buy.
3. Citigroup Inc. (NYSE:C)
Forward Price-to-Earnings: 12.36
Number of Hedge Fund Holders: 96
Citigroup Inc. (NYSE:C) is included in our list of the 10 Most Undervalued Value Stocks to Buy Now.
On July 16, 2025, Oppenheimer raised its price target on Citigroup Inc. (NYSE:C) from $107 to $123. This price revision followed the company’s strong Q2 earnings. The target increase was attributed to stronger-than-expected core revenue of $21.8 billion versus the $21.0 billion estimate, lower-than-expected expenses at $13.6 billion, and core pre-provision earnings of $8.3 billion against a $7.4 billion forecast.
Two weeks later, on July 30, 2025, Oppenheimer reiterated its ‘Outperform’ rating on Citigroup Inc. (NYSE:C), raising its price target further to $124, signaling continued confidence in the company’s recovery momentum.
Operating through its Services, Markets, Banking, U.S. Personal Banking, and Wealth segments, Citigroup Inc. (NYSE:C) provides diversified financial services to individuals, corporations, and governments. It is included in our list of the most undervalued value stocks to buy.
2. Pfizer Inc. (NYSE:PFE)
Forward Price-to-Earnings: 8.19
Number of Hedge Fund Holders: 99
With strong hedge fund interest and a low price-to-earnings ratio, Pfizer Inc. (NYSE:PFE) secures a place on our list of the 10 Most Undervalued Value Stocks to Buy Now.
Following the company’s strong Q2 performance, Citi raised its price target on Pfizer Inc. (NYSE:PFE) from $25 to $26 on August 6, 2025, maintaining a ‘Neutral’ rating. The analyst attributed the target revision to strong results. At the same time, Citi advised caution regarding continued policy uncertainties.
Pfizer Inc. (NYSE:PFE) reported 10% revenue growth, taking total revenue to $14.7 billion. The top-line growth was driven by strong sales of the Vyndaqel product family, Comirnaty, Paxlovid, Padcev, Eliquis, and other products. At the quarter-end, the company also reiterated its 2025 revenue guidance of $61.0-$64.0 billion, while raising its adjusted diluted EPS outlook by $0.10 at the midpoint to $2.90-$3.10. This guidance raise was made despite challenges caused by the Inflation Reduction Act’s Medicare Part D redesign.
Pfizer Inc. (NYSE:PFE) discovers, develops, and markets biopharmaceutical products globally. It is included in our list of the most undervalued value stocks to buy.
1. Bank of America Corporation (NYSE:BAC)
Forward Price-to-Earnings: 12.61
Number of Hedge Fund Holders: 117
Bank of America Corporation (NYSE:BAC) is included in our list of the 10 Most Undervalued Value Stocks to Buy Now.
Following signs of a cooling U.S. economy, Bank of America Corporation (NYSE:BAC) revised its interest-rate outlook.
Reported on August 11, Bank of America Corporation (NYSE:BAC)’s strategist, Mark Cabana, reduced the year-end forecast for two-year Treasury yields to 3.5% from 3.75%. Meanwhile, the forecast for 10-year yields was trimmed to 4.25% from 4.5%. The strategist cited softer labor market data and shifting Federal Reserve risk assessments.
Furthermore, Bank of America Corporation (NYSE:BAC) sees the appointment of Stephen Miran as Fed governor as a catalyst that could tilt policy toward lower rates. While the bank expects no Fed action until the second half of 2026, the company’s rate team thinks there is a greater chance rates could fall sooner. Accordingly, the bank advises investors to buy longer-duration bonds. Meanwhile, market swaps indicate more than two rate cuts by December, with an 80% chance of a quarter-point cut as soon as next month.
With its Consumer, Wealth Management, Corporate, and Market segments, Bank of America Corporation (NYSE:BAC) offers financial products and services globally. It is included in our list of the most undervalued value stocks to buy.
While we acknowledge the potential of BAC 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 BAC and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 12 Cheap Value Stocks to Buy Now According to Seth Klarman and 13 Hot Oil Stocks to Buy Now.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email below.
