11 Best Very Cheap Stocks to Buy According to Hedge Funds

7. Rio Tinto Group (NYSE:RIO)

Number of Hedge Fund Holders: 31

Forward P/E Ratio: 10.74

Rio Tinto Group (NYSE:RIO) is one of the best very cheap stocks to buy according to hedge funds. On August 25, Morgan Stanley increased its price target for Rio Tinto’s stock to AUD 121 ($78.44) from AUD 118 ($76.50). The investment bank maintained an Equalweight rating on the shares.

This change came after the bank updated its financial model for the first half of 2025. The update resulted in a 2.7% reduction in the bank’s estimate for Rio Tinto’s earnings per share for fiscal year 2025. However, estimates for fiscal year 2026 rose by 0.1%, and for fiscal year 2027 by 2.3%, due to changes in forecasts for depreciation and aluminum.

Morgan Stanley’s base case value for Rio Tinto went up by 1% to AUD119.50 per share. Meanwhile, the bull case value increased by 3% to AUD 242.50 per share, and the bear case by 13% to AUD 52.50 per share. The higher price target is 3% higher than the previous one, primarily due to the increased base value and higher current commodity prices.

The analysts pointed out that Rio Tinto’s stock may benefit from better future earnings outlooks from aluminum and depreciation tweaks. They also noted that the company’s market position is solid.

Rio Tinto Group (NYSE:RIO) is a British-Australian metals and mining company. It explores, mines, and processes mineral resources including iron ore, copper, aluminum, and lithium across operations in over 30 countries. The company owns and operates open-pit and underground mines, refineries, smelters, and shipping facilities.