In this article, we will discuss 12 Best Very Cheap Stocks to Buy in 2026.
Stocks with a low forward price-to-earnings (P/E) ratio are often viewed as attractive because they suggest investors are paying relatively little for each dollar of expected future earnings. Unlike the trailing P/E ratio, which reflects past profitability, the forward P/E is based on analysts’ projections of future profits. This makes it a more forward-looking valuation metric and a useful tool for identifying stocks that may be undervalued relative to their earnings potential. When a company trades at a low forward P/E despite solid fundamentals or improving growth prospects, it can signal an opportunity for investors to enter at a compelling price before the broader market fully recognizes its value.
One of the primary appeals of a low forward P/E ratio is its ability to highlight potential undervaluation. If the multiple is meaningfully below that of industry peers or the broader market, it may indicate the stock is priced conservatively relative to its expected earnings trajectory. In many cases, when a company’s trailing P/E is higher than its forward P/E, it reflects expectations of rising profits in the coming years. As earnings grow, the valuation effectively becomes more attractive on a forward basis, which can support long-term share price appreciation.
For investors evaluating potential stock purchases, the forward P/E ratio serves as a particularly valuable screening tool because it focuses on future performance rather than historical results. Markets are inherently forward-looking, and valuations tend to adjust based on anticipated growth rather than past achievements. As a result, companies trading at low forward multiples can offer a favorable risk-reward profile, especially if their earnings outlook remains stable or improves.
Low forward P/E stocks are, therefore, especially appealing to value-oriented investors who prioritize a margin of safety and disciplined entry points. Rather than paying premium valuations for anticipated growth, these investors seek companies where expectations are already modest. In some cases, subdued valuations may reflect cautious market sentiment. If the company ultimately delivers stronger-than-expected results, the gap between perception and performance can lead to both earnings-driven gains and valuation multiple expansion, amplifying overall returns.
With this context in mind, here is a list of the 12 best very cheap stocks to buy in 2026.
Our Methodology
We used screeners to identify stocks that are trading below a forward P/E of 10, 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. To make this list easier to navigate, we have ranked stocks in descending order of their forward P/E.
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 Very Cheap Stocks to Buy in 2026
12. KeyCorp (NYSE:KEY)
Forward P/E: 9.31
On March 2, Morgan Stanley raised the firm’s price target on KeyCorp (NYSE:KEY) to $26 from $24 while maintaining an Equal Weight rating on the shares. The firm said it is increasing price targets across the mid-cap banking group by a median of 8%. Although the bank group has recently outperformed the broader market—raising the bar for further upside—Morgan Stanley remains optimistic about the sector’s outlook. The firm cited several potential tailwinds, including stronger loan growth, expanding net interest margins, and continued capital return to shareholders.
On February 24, Robert W. Baird & Co. upgraded KeyCorp (NYSE:KEY) to Neutral from Underperform while keeping its price target unchanged at $19. The firm attributed the upgrade primarily to valuation after a recent selloff in regional bank stocks. According to the analyst, the sector declined amid fears about artificial intelligence potentially disrupting the banking industry, concerns that were amplified by a blog post over the weekend outlining potential macroeconomic stress scenarios. Baird argued that those projections—such as unemployment reaching 11% and severe credit deterioration tied to a weakening U.S. consumer—appear excessive. With shares trading around 1.5 times tangible book value, the firm believes the stock presents a balanced risk-reward profile. Additionally, Baird suggested that banks are more likely to benefit from AI adoption through efficiency gains rather than face meaningful disruption from the technology.
KeyCorp (NYSE:KEY) is a major U.S. regional bank headquartered in Cleveland, Ohio, with approximately $187 billion in assets as of late 2025. Operating primarily through its banking subsidiary KeyBank, the company serves customers across 15 states, offering consumer and commercial banking, mortgage lending, and investment services.
11. The Carlyle Group Inc. (NASDAQ:CG)
Forward P/E: 8.99
On March 2, Barclays lowered the firm’s price target on The Carlyle Group Inc. (NASDAQ:CG) to $68 from $71 while maintaining an Overweight rating on the shares. The firm revised its estimates across the alternative asset manager sector. Although Barclays noted that it remains too early to determine the full impact of artificial intelligence on the portfolio companies held by private equity firms, the analyst said the firm reduced earnings projections tied to business development company activity due to lower expected capital flows and realizations.
In contrast, on February 27, TD Cowen raised its price target on The Carlyle Group Inc. (NASDAQ:CG) to $67 from $65 while reiterating a Buy rating. The firm attended the company’s investor day and came away with two key conclusions. First, analysts believe Carlyle has successfully transitioned from an extended period of internal restructuring and strategic repositioning toward a phase of stronger operational execution. Second, the firm sees the company’s pathway to more than $6 in distributable earnings per share by 2028 as both compelling and conservative, suggesting potential upside if performance continues to improve.
The Carlyle Group Inc. (NASDAQ:CG) is a global investment firm headquartered in Washington, D.C. Founded in 1987, the company manages approximately $477 billion in assets across 678 investment vehicles as of early 2026. Carlyle specializes in private equity, global credit, and investment solutions, including those offered through its subsidiary AlpInvest Partners.
10. Principal Financial Group, Inc. (NASDAQ:PFG)
Forward P/E: 8.98
On March 3, Principal Financial Group, Inc. (NASDAQ:PFG) announced that it had entered into a definitive agreement with Southland Benefit Solutions to acquire its single-state dental network, DentaNet. As part of the transaction, Principal will also obtain renewal rights for a block of group insurance contracts through Canopy Insurance. Both Southland Benefit Solutions and Canopy Insurance operate as subsidiaries of Collateral Holdings. DentaNet is currently the largest dental network in the state of Alabama, with approximately 1,500 participating dental providers.
Following the acquisition, DentaNet will become part of Principal Financial Group, Inc. (NASDAQ:PFG)’s portfolio of wholly owned dental networks. It will join existing networks, including Principal Preferred Provider Network, Diversified Dental Services, and First Dental Health. The expansion is expected to strengthen Principal’s dental insurance offerings and broaden its provider network footprint, particularly within the southeastern United States.
Also on March 3, Morgan Stanley raised its price target on Principal Financial Group, Inc. (NASDAQ:PFG) to $95 from $93 while maintaining an Equal Weight rating. The firm said it is updating its price targets across North American life and annuity insurers under coverage. While Morgan Stanley indicated it is not particularly concerned about the industry’s exposure to private credit markets, the broader insurance sector may still face valuation pressure amid evolving market conditions.
Principal Financial Group, Inc. (NASDAQ:PFG) is a global financial investment management and insurance company headquartered in Des Moines, Iowa. Founded in 1879 as Bankers Life Association, the company provides asset management, retirement services, insurance products, and investment solutions to individuals, businesses, and institutional clients worldwide.
9. The Gap, Inc. (NYSE:GAP)
Forward P/E: 8.94
On March 6, Bank of America raised the firm’s price target on The Gap, Inc. (NYSE:GAP) to $29 from $27 while maintaining a Neutral rating. The firm said there were “no surprises” in the company’s fourth-quarter results. Although analysts were encouraged by positive comparable sales growth, they remain cautious about the outlook for lower-income consumers, who could face pressure from tariffs and broader economic factors. Bank of America increased its fiscal 2026 earnings per share estimate by 3% to $2.25, reflecting a slightly improved outlook for gross margins. On the same day, Citigroup also raised its price target on GAP to $27 from $25 while keeping a Neutral rating.
The Gap, Inc. (NYSE:GAP) reported that for the fourth quarter and fiscal year ended January 31, 2026, net sales increased 2% to $15.4 billion. The company recorded its second consecutive year of revenue growth and its eighth straight quarter of positive comparable sales. Operating income reached $1.1 billion with a margin of 7.3%. Performance was supported by strong online sales growth and improving brand momentum at divisions such as Old Navy, Gap, and Banana Republic, although tariffs pressured overall gross margins, and Athleta continued to face declining performance.
The Gap, Inc. (NYSE:GAP) ended fiscal 2025 with $3.0 billion in cash and generated $1.3 billion in operating cash flow along with $823 million in free cash flow. Gap returned approximately $402 million to shareholders through dividends and share repurchases during the year. Its board of directors approved a new $1 billion share repurchase authorization and increased the quarterly dividend. Management also guided for modest net sales growth and further operating margin expansion in fiscal 2026, reflecting confidence in the company’s transformation strategy and financial position.
The Gap, Inc. (NYSE:GAP) is an American multinational apparel and accessories retailer founded in 1969 and headquartered in San Francisco, California. The company operates a portfolio of globally recognized clothing brands and retail platforms serving customers through both physical stores and digital channels. Out of the 12 best very cheap stocks to buy in 2026, Gap falls in ninth place.
8. American International Group, Inc. (NYSE:AIG)
Forward P/E: 8.88
On March 5, Goldman Sachs upgraded American International Group, Inc. (NYSE:AIG) to Buy from Neutral and raised its price target to $90 from $83, implying roughly 16% total return potential. The firm noted that AIG offers industry-leading earnings growth prospects and an improving return on equity over the coming years. According to the analyst, while the company remains exposed to cyclical pressures affecting the broader insurance market, its earnings outlook is supported by strong underwriting performance, value-accretive transactions that enhance operating leverage, and a flexible capital structure that enables continued investment and shareholder returns. Goldman Sachs also believes the stock’s valuation appears attractive at current levels relative to peers.
On February 17, Cantor Fitzgerald raised its price target on American International Group, Inc. (NYSE:AIG) to $81 from $77 while maintaining a Neutral rating. The firm noted that insurance stocks experienced a volatile trading period as brokerage firms and insurers sold off amid concerns that artificial intelligence could potentially disrupt traditional insurance distribution channels. Despite these fears, analysts suggested the industry’s long-term outlook remains supported by underwriting discipline and steady demand for risk management services.
American International Group, Inc. (NYSE:AIG) is a global insurance organization headquartered in New York and founded in 1919. The company provides property-casualty insurance, life insurance, and retirement solutions to individuals and businesses across more than 200 countries and jurisdictions. AIG is known for offering specialized coverage for complex risks and high-net-worth clients while maintaining a large global commercial insurance platform.
7. BorgWarner Inc. (NYSE:BWA)
Forward P/E: 8.85
On March 6, UBS analyst Joseph Spak upgraded BorgWarner Inc. (NYSE:BWA) to Neutral from Sell with a price target of $55. The analyst indicated that the stock now more appropriately reflects the probability and timing of success for the company’s emerging TurboCell opportunity in data-center power generation. The technology could provide a new avenue of growth beyond BorgWarner’s traditional automotive components business, particularly as demand for power solutions tied to artificial intelligence infrastructure expands.
On February 11, BorgWarner Inc. (NYSE:BWA) reported its fourth-quarter and full-year results. The company generated approximately $14.3 billion in net sales during 2025, representing an increase of about $200 million compared with the prior year. Adjusted earnings per share rose 14% year over year, and full-year free cash flow exceeded $1.2 billion, representing a roughly 66% increase from 2024. BorgWarner returned approximately 52% of its 2025 free cash flow to shareholders—about $630 million—through share repurchases and other capital returns. The company repurchased $400 million worth of shares during 2025 and still has $600 million remaining under its repurchase authorization. Since 2021, BorgWarner has repurchased about 31 million shares, reducing its share count by roughly 13%.
Looking ahead, BorgWarner Inc. (NYSE:BWA)’s 2026 guidance calls for total sales of between $14.0 billion and $14.3 billion compared with $14.3 billion in 2025. The company expects about a $200 million benefit from foreign exchange movements, while underlying end markets are projected to be flat to down roughly 3%. Light-vehicle markets—representing more than 80% of the company’s revenue—are expected to perform broadly in line with overall industry trends. Organic sales are projected to decline between 3.5% and 1.5%, including a roughly 150-basis-point headwind related to lower battery sales. Adjusted operating margins are expected to range from 10.7% to 10.9%, roughly in line with 2025 levels, including a modest benefit from exiting the charging business and cost control measures that help offset lower revenue. Adjusted earnings per share are projected to reach between $5.00 and $5.20 per diluted share, representing approximately 4% growth at the midpoint.
BorgWarner Inc. (NYSE:BWA) is a global automotive supplier headquartered in Auburn Hills, Michigan. The company develops technologies designed to improve efficiency and performance in combustion, hybrid, and electric vehicles. Seventh in the list of 12 best very cheap stocks to buy in 2026, BorgWarner operates in 24 countries and produces components including turbochargers, electric propulsion modules, and advanced battery systems used by automakers around the world.
6. AerCap Holdings N.V. (NYSE:AER)
Forward P/E: 8.40
On March 2, Morgan Stanley raised the firm’s price target on AerCap Holdings N.V. (NYSE:AER) to $160 from $150 while maintaining an Equal Weight rating on the shares. The firm said it updated its financial model following the company’s fourth-quarter results and management commentary, reflecting a refined outlook for the aircraft leasing company’s earnings trajectory and capital allocation strategy.
On February 5, AerCap Holdings N.V. (NYSE:AER) reported record financial results for full-year 2025. The company generated GAAP net income of $3.8 billion, or $21.30 per share, and adjusted net income of $2.7 billion, or $15.37 per share—both representing company records. AerCap also reported a GAAP return on equity of 21% and an adjusted return on equity of 15%. Total revenue reached an all-time high of $8.5 billion, while aircraft sales volumes also set a record at $3.9 billion. The company reported a gain-on-sale margin of 27% for the year, translating to approximately twice book equity on owned assets.
AerCap Holdings N.V. (NYSE:AER) returned approximately $2.6 billion to shareholders during 2025 through share repurchases and dividends, including the buyback of about 22.1 million shares. In December, the company announced a new $1 billion share repurchase authorization and increased its quarterly dividend to $0.40 per share. During the fourth quarter alone, AerCap repurchased 3.5 million shares for $444 million at an average price of $127.63 per share.
Looking ahead, AerCap Holdings N.V. (NYSE:AER) guided for adjusted earnings per share of $12.00 to $13.00 in 2026, excluding any gains from asset sales. AerCap expects GAAP net income of roughly $1.7 billion and adjusted net income of about $2.0 billion after adding back approximately $300 million in purchase-accounting adjustments. Management noted that 2025 results included $3.95 per share of gains on sale that are not assumed in the 2026 outlook.
Founded in 1995, AerCap Holdings N.V. (NYSE:AER) is an Irish-American aviation leasing company headquartered in Dublin, Ireland. The company leases commercial aircraft, engines, and helicopters through long-term agreements with airlines around the world and maintains offices across multiple global markets.
5. Southwest Airlines Co. (NYSE:LUV)
Forward P/E: 8.35
On March 5, Rothschild & Co Redburn raised its price target on Southwest Airlines Co. (NYSE:LUV) to $35 from $27 while maintaining a Sell rating. The analyst said domestic airline capacity growth is accelerating during the year and warned that geopolitical tensions involving Iran could introduce disruptive pressures and lead to significant fuel cost inflation. Higher fuel prices prompted the firm to lower its earnings forecasts for airlines and anticipate further downward revisions across industry consensus estimates during the year.
Previously, on February 27, TD Cowen upgraded Southwest Airlines Co. (NYSE:LUV) to Buy from Hold and raised its price target to $66 from $50. The firm argued that airline demand appears to be strengthening in 2026 while supply growth remains relatively disciplined. Analysts expect Southwest to increase its guidance during March and believe improving earnings estimates could support higher share prices. TD Cowen also suggested that the broader improvement in the airline industry environment makes negative earnings revisions for Southwest less likely during the year.
Southwest Airlines Co. (NYSE:LUV) is a major U.S. airline headquartered in the Love Field neighborhood of Dallas, Texas. The company was originally incorporated as Air Southwest Co. on March 15, 1967, by Herb Kelleher and Rollin King with the goal of offering low-cost intrastate flights within Texas. The airline officially adopted the name Southwest Airlines in 1971 and has since grown into one of the largest domestic carriers in the United States. The company is fifth in the list of 12 best very cheap stocks to buy in 2026.
4. Magna International Inc. (NYSE:MGA)
Forward P/E: 7.57
On March 4, Bank of America reinstated coverage of Magna International Inc. (NYSE:MGA) with a Buy rating and a price target of $80. The firm said it is resuming coverage of the North American automotive and auto-technology sector and expects the industry to outperform expectations this year. According to the analyst, automakers are adjusting to a regulatory environment that may favor higher-margin internal combustion engine vehicles, which could benefit suppliers such as Magna.
On February 18, Morgan Stanley analyst Andrew Percoco raised the firm’s price target on Magna International Inc. (NYSE:MGA) to $65 from $54 while maintaining an Equal Weight rating. The firm updated its estimates following the company’s fourth-quarter earnings results. The day before, Scotiabank analyst Jonathan Goldman also raised the firm’s price target on MGA to $69 from $57 while maintaining a Sector Perform rating after reviewing the quarterly results released on February 13.
Magna International Inc. (NYSE:MGA) reported fourth-quarter sales of $10.8 billion, representing a 2% increase year over year, though revenue declined approximately 1% on a constant-currency basis. The company’s adjusted EBIT margin expanded by 100 basis points to 7.5%, while adjusted EBIT increased 18% to $814 million. Adjusted earnings per share rose 29% to $2.18 during the quarter.
Magna International Inc. (NYSE:MGA) is a Canadian automotive parts manufacturer headquartered in Aurora, Ontario. Founded in 1957, the company is one of the largest independent automotive suppliers globally and specializes in the design, engineering, and manufacturing of advanced vehicle systems and components for automakers.
3. Delta Air Lines, Inc. (NYSE:DAL)
Forward P/E: 7.11
On March 5, Rothschild & Co Redburn lowered its price target on Delta Air Lines, Inc. (NYSE:DAL) to $70 from $72 while maintaining a Buy rating. The firm warned that domestic airline capacity growth is accelerating throughout the year and that geopolitical tensions involving Iran could add disruptive pressures while increasing fuel costs. According to the analyst, higher fuel prices have led to a meaningful reduction in the firm’s airline earnings forecasts and could trigger substantial downward revisions to industry consensus estimates.
The same day, Delta Air Lines, Inc. (NYSE:DAL) announced a series of leadership changes. After more than three decades with the company, John Laughter will retire as Executive Vice President, Chief of Operations, and President of Delta TechOps effective April 30. Following his retirement, Dan Janki will assume the role of Chief Operating Officer, overseeing Delta’s airport operations, flight operations, in-flight service, reservations, technical operations, and corporate safety and compliance functions. Alain Bellemare, Executive Vice President and President – International, will also take on additional responsibilities as Chairman of Delta TechOps.
Delta Air Lines, Inc. (NYSE:DAL) also announced that Erik Snell will become Chief Financial Officer, overseeing Delta’s finance organization, fleet and supply chain teams, and refinery subsidiary Monroe Energy. Snell joined Delta two decades ago and most recently served as Chief Customer Experience Officer. Meanwhile, Chief Marketing Officer Alicia Tillman will depart the company to pursue broader leadership opportunities. Following her departure, Ranjan Goswami will assume the role of Chief Marketing and Product Officer.
Delta Air Lines, Inc. (NYSE:DAL) is one of the largest airlines in the United States and is headquartered in Atlanta, Georgia. Founded in 1925, the airline operates a global network of flights and maintains nine major hub airports across its route system.
2. United Airlines Holdings, Inc. (NASDAQ:UAL)
Forward P/E: 6.05
On March 5, Rothschild & Co Redburn analyst James Goodall lowered the firm’s price target on United Airlines Holdings, Inc. (NASDAQ:UAL) to $110 from $125 while maintaining a Buy rating. Similar to its outlook for other airlines, the firm cited accelerating domestic airline capacity growth and geopolitical tensions involving Iran that could contribute to higher fuel prices and disrupt industry profitability. As a result, the analyst reduced earnings forecasts for airline companies and expects broader consensus estimates to decline throughout the year.
On February 19, Jefferies analyst Sheila Kahyaoglu lowered the firm’s price target on United Airlines Holdings, Inc. (NASDAQ:UAL) to $148 from $154 while maintaining a Buy rating. After reviewing the company’s annual 10-K filing, the firm indicated that first-quarter performance appears to be tracking toward the high end of adjusted earnings guidance of $1.00 to $1.50 per share, supported by strong demand across multiple ticket classes, including economy. However, Jefferies trimmed its full-year 2025 earnings estimate to $13.65 per share to account for rising fuel costs.
United Airlines Holdings, Inc. (NASDAQ:UAL) is an airline holding company headquartered in Chicago, Illinois. The company provides passenger and cargo transportation services throughout North America and to international destinations around the world. United Airlines Holdings was incorporated in 1968 and operates one of the largest global airline networks.
1. Stellantis N.V. (NYSE:STLA)
Forward P/E: 3.81
On March 2, Freedom Capital analyst Dmitriy Pozdnyakov downgraded Stellantis N.V. (NYSE:STLA) to Hold from Buy while lowering the firm’s price target to $8 from $9. The analyst said the company’s reaffirmed 2026 guidance suggests that operating margins are likely to remain under pressure throughout the year as Stellantis works through a period of strategic repositioning.
Stellantis N.V. (NYSE:STLA) reported its full-year 2025 results on February 26, 2026. The company posted net revenues of €153.5 billion, representing a 2% year-over-year decline, and recorded a net loss of €22.3 billion. The loss was largely driven by €25.4 billion in unusual charges related to a strategic reset focused on providing customers with greater powertrain choice. Stellantis also reported an adjusted operating loss of €842 million and negative industrial free cash flow of €4.5 billion. In response to these pressures, the company suspended its dividend for 2026 while authorizing up to €5 billion in hybrid bonds to support liquidity, which stood at approximately €46 billion.
Despite the weak full-year performance, Stellantis N.V. (NYSE:STLA) reported a stronger second half of 2025 following changes in its leadership structure. Net revenue increased approximately 10% during the second half compared with the first half of the year, while industrial free cash flow outflows improved by roughly 50%. The improvement was supported by new product launches and better operational execution across the company’s manufacturing and distribution networks.
Looking ahead, Stellantis N.V. (NYSE:STLA) reaffirmed its 2026 guidance and expects progressive improvements in net revenue, adjusted operating margins, and industrial free cash flow throughout the year. The company said it is focused on returning to profitable growth while rebalancing its strategy for the energy transition to better reflect customer preferences for electric, hybrid, and traditional combustion engine vehicles.
Stellantis N.V. (NYSE:STLA) is a global automotive manufacturer headquartered in the Netherlands. The company produces passenger vehicles, commercial vehicles, and mobility solutions and operates both industrial manufacturing activities and a financial services division across major automotive markets in Europe, North America, and other regions.
While we acknowledge the potential of STLA as one of the best very cheap stocks to buy in 2026, 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 STLA and that has 100x upside potential, check out our report about this cheapest AI stock.
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