In this article, we will look at the 12 Best Affordable Stocks Under $40 to Buy.
On February 17, Jeremy Siegel, professor emeritus of finance at the University of Pennsylvania’s Wharton School of Business, appeared on a CNBC television interview to talk about the markets. Siegel noted that, despite the recent slowdown, the market still appears promising. Before the start of the year, Siegel had noted that the market would have to move past “3 speed-bumps.” The first bump was the change of Federal Reserve Chairman, the second was the government showdown, and the third is going to be the Supreme Court’s ruling on Trump’s billion-dollar tariffs. Siegel noted that once the market moves past these hurdles, the rest of the runway looks clear; however, there will be a period of digestion.
He added that the market is going through a rotation period with one of the biggest surges in value stocks as compared to growth stocks in over four years. He noted that although we are witnessing the Mag Seven spending billions of dollars on AI, the use cases still need to prove the return on investment of all the capital expenditure. Siegel sees the rotation toward value stocks as a positive factor for the overall market health.
With that, let’s take a look at the 12 Best Affordable Stocks Under $40 to Buy.
Our Methodology
To curate the list of 12 Best Affordable Stocks Under $40 to Buy, we used the Finviz stock screener, Seeking Alpha, and Insider Monkey’s Q3 2025 hedge funds database. Using the screener, we aggregated a list of stocks trading below the forward price to earnings of 14. Next, we cross-checked the P/E ratios from Seeking Alpha and ranked the stocks in ascending order of the number of hedge fund holders.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
12 Best Affordable Stocks Under $40 to Buy
12. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 26
Enterprise Products Partners L.P. (NYSE:EPD) is among the Best Affordable Stocks Under $40 to Buy. Analysts have been raising price targets on Enterprise Products Partners L.P. (NYSE:EPD) since the company released its fiscal Q4 2025 earnings on February 3.
Recently, on February 5, Michael Blum from Wells Fargo raised the firm’s price target from $36 to $38, while maintaining a Hold rating on the stock. Earlier, on February 4, Brandon Bingham from Scotiabank also reiterated a Hold rating on the stock and raised the price target from $35 to $37.
The increased price targets follow Enterprise Products Partners’ earnings beat. During fiscal Q4 2025, the company posted $13.79 billion in revenue, reflecting 2.87% decrease year-over-year but ahead of consensus by $1.43 billion. Moreover, the EPS of $0.75 also topped estimates by $0.06. Management attributed the quarterly performance to significant growth in its Natural Gas segment and Petrochemical & Refined Products segment, but this was offset by lower oil prices.
Brandon Bingham from Scotiabank described Enterprise Products Partners L.P. (NYSE:EPD)’s earnings as solid, with guidance currently exceeding consensus analyst expectations. However, the analyst maintained a Hold rating on the stock due to a notable gap between EPD’s communicated operational data points and how those translate into final modeled financial outcomes.
Enterprise Products Partners L.P. (NYSE:EPD) is a major North American midstream energy company that transports, stores, and processes natural gas, natural gas liquids (NGLs), crude oil, refined products, and petrochemicals.
11. Energy Transfer LP (NYSE:ET)
Number of Hedge Fund Holders: 35
Energy Transfer LP (NYSE:ET) is among the Best Affordable Stocks Under $40 to Buy. Energy Transfer LP (NYSE:ET) released fiscal Q4 2025 earnings on February 17. The company topped revenue estimates by $1.28 billion, but the EPS fell short by $0.11. Revenue for the quarter grew 29.57% year-over-year to reach $25.32 billion, while the EPS came in at $0.25.
Despite the EPS miss, the company continued to grow its volumes in the fourth quarter. NGL and refined product terminals volumes were up 12%, while NGL transportation volumes grew 5%. Management noted that the volume growth was driven by robust demand from data centers and power generation. Notably, the company started natural gas deliveries to Oracle’s data center in Texas. Management noted that this is the first of multiple long-term contracts totaling roughly 900 MMcf/d across three facilities.
Looking ahead, Energy Transfer LP (NYSE:ET) has set its 2026 adjusted EBITDA guidance between $17.45 billion and $17.85 billion, up from the previous range of $17.3 and $17.7 billion.
Energy Transfer LP (NYSE:ET) is a midstream energy company that owns and operates one of the largest portfolios of natural gas, crude oil, and NGL pipelines in the United States. Its assets include interstate and intrastate natural gas pipelines, storage facilities, fractionation plants, and crude oil terminals.
