In this article, we will be taking a look at the 12 Most Profitable Cheap Stocks to Buy Right Now.
On July 7, Reuters reported that the S&P 500 declined as shares of chipmakers fell. The drop came as investors became more doubtful about whether the strong AI-driven rally on Wall Street will continue.
This marks the latest period of volatility for memory chipmakers and other AI-related stocks. Investors are concerned that the sharp gains linked to the buildout of AI data centers have pushed these stocks to very high valuations.
Reuters also reported that Chinese startup DeepSeek is developing its own AI chip, which added to concerns regarding chipmakers and their high valuations.
Zachary Hill, head of portfolio management at Horizon Investments in Charlotte, North Carolina, said that “the story of today is the story of the last few weeks, and that’s rotation after the blistering run in the AI buildout, semis and memory. Expectations have gotten to be almost impossible to beat for these companies.”
With this background in mind, let’s take a look at the 12 most profitable cheap stocks to buy right now.
Our Methodology
To compile our list of the 12 most profitable cheap stocks to buy right now, we looked for cheap stocks trading at under 15 times their forward earnings as of July 6, 2026. Then, we focused on profitability and narrowed our choices to stocks that had trailing twelve-month (TTM) net income of more than $1 billion and a profit margin of more than 20%. Next, we focused on the top 12 most profitable stocks that are favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q1 2026 database of 1022 elite hedge funds. Finally, the 12 most profitable cheap stocks to buy right now were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q1 2026.
Why do we care about what hedge funds do? 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. Insider Monkey’s quarterly newsletter strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
12 Most Profitable Cheap Stocks to Buy Right Now
12. The PNC Financial Services Group, Inc. (NYSE:PNC)
Forward P/E: 13.46
Profit Margin: 31.31%
Net Income Available to Common (TTM): $6.85 Billion
Number of Hedge Fund Holders: 63
The PNC Financial Services Group, Inc. (NYSE:PNC) is one of the most profitable cheap stocks to buy right now. On June 25, UBS reiterated its Buy rating on The PNC Financial Services Group, Inc. (NYSE:PNC) with a price target of $263 on the stock.
This update came after meetings at the company’s headquarters with the senior leadership team. UBS analyst Erika Najarian met with The PNC Financial Services Group, Inc.’s (NYSE:PNC) CEO Bill Demchak, President Mark Wiedman, CFO Rob Reilly and other senior executives from the company’s major business lines. UBS said it had not been this impressed after meeting with a management team since its meeting with Morgan Stanley in June 2025.
The research firm believes that The PNC Financial Services Group, Inc. (NYSE:PNC) should be seen as an emerging national bank that is valued like a regional bank. UBS added that if the company reaches a return on tangible common equity of about 20%, its valuation looks attractive compared with global systemically important banks.
UBS also believes The PNC Financial Services Group, Inc. (NYSE:PNC) has room for both earnings per share upgrades and multiple expansion. In addition, the firm sees strong backing for the stock from long-term investors.
The PNC Financial Services Group, Inc. (NYSE:PNC) is one of the largest diversified financial services institutions in the US. It offers retail and corporate banking, lending products, wealth management, asset management, and specialized services for corporations and government entities.
11. PDD Holdings Inc. (NASDAQ:PDD)
Forward P/E: 7.35
Profit Margin: 21.62%
Net Income Available to Common (TTM): $95.65 Billion
Number of Hedge Fund Holders: 66
PDD Holdings Inc. (NASDAQ:PDD) is one of the most profitable cheap stocks to buy right now. On June 27, Citi said that China’s major internet companies have become unpopular with investors this year as money has shifted toward AI chipmakers. However, the bank believes the recent decline in these stocks has gone too far and this has now created an attractive buying opportunity.
Citi named PDD Holdings Inc. (NASDAQ:PDD) as one of its top picks. The bank said many of these internet companies are trading near their lowest valuations in years, even though they continue to generate strong cash flows. According to the brokerage, the recent weakness in the share prices does not reflect the underlying strength of their businesses.
Additionally, Citi said that these stocks would still appear cheap even if profits were lower than expected over the next year. This indicates that much of the negative news has already been priced into their shares.
Another reason for Citi’s optimism is the strong financial position of these companies. PDD Holdings Inc. (NASDAQ:PDD) alone holds about $63 billion in cash, cash equivalents, and short-term investments. While the AI hardware sector could continue attracting investors in the near term, Citi expects investors to eventually return to profitable internet companies with strong core businesses, healthy cash generation, and expanding AI capabilities.
PDD Holdings Inc. (NASDAQ:PDD), formerly Pinduoduo Inc., is a multinational commerce group best known for its e-commerce platforms, Pinduoduo and Temu.
10. Gilead Sciences, Inc. (NASDAQ:GILD)
Forward P/E: 14.88
Profit Margin: 30.99%
Net Income Available to Common (TTM): $9.22 Billion
Number of Hedge Fund Holders: 77
Gilead Sciences, Inc. (NASDAQ:GILD) is one of the most profitable cheap stocks to buy right now. On June 30, Morgan Stanley kept its Buy rating on Gilead Sciences, Inc. (NASDAQ:GILD) and maintained its price target of $168.
The research firm’s positive view is based on a number of factors, including the company’s growth outlook and the Yeztugo launch trajectory. Morgan Stanley sees Yeztugo as a key driver of the company’s growth in the medium term. Gilead Sciences, Inc. (NASDAQ:GILD) has raised its 2026 sales guidance for Yeztugo.
Earlier, on June 15, Gilead Sciences, Inc. (NASDAQ:GILD) announced that the US Food and Drug Administration (FDA) accepted its supplemental New Drug Application (sNDA) for a 300 mg tablet version of Yeztugo (lenacapavir). The company is seeking approval for the drug as a potential once-weekly (QW) oral formulation for the prevention of HIV as pre-exposure prophylaxis (PrEP). The FDA has set a Prescription Drug User Fee Act (PDUFA) action date of February 2, 2027.
Lenacapavir tablets are already approved as part of the Yeztugo treatment regimen for an initial loading dose and as a bridge therapy when the every-six-month injections are delayed. If the new application is approved, once-weekly oral Yeztugo would become the first long-acting oral PrEP treatment.
Gilead Sciences, Inc. (NASDAQ:GILD) is a biopharmaceutical company focused on advancing innovative medicines to prevent and treat life-threatening diseases, including HIV, viral hepatitis, COVID-19, cancer, and inflammation.
9. Wells Fargo & Company (NYSE:WFC)
Forward P/E: 11.74
Profit Margin: 26.74%
Net Income Available to Common (TTM): $20.67 Billion
Number of Hedge Fund Holders: 82
Wells Fargo & Company (NYSE:WFC) is one of the most profitable cheap stocks to buy right now. On July 1, Goldman Sachs added Wells Fargo & Company (NYSE:WFC) to its US Conviction List as part of the firm’s monthly update.
The research firm said that Wells Fargo & Company (NYSE:WFC) is moving “from defense to offense” as it expects the company to improve its balance sheet. Goldman Sachs pointed to strong capital markets and strength in the company’s credit card business. The firm kept its Buy rating on the stock with a price target of $93.
Earlier, on June 24, Wells Fargo & Company (NYSE:WFC) reported that it had completed the Federal Reserve’s 2026 supervisory stress test process. As previously stated by the Federal Reserve, the results of this year’s stress test do not change bank capital requirements. The company said that its stress capital buffer (SCB) is still at 2.5%.
Additionally, Wells Fargo & Company (NYSE:WFC) announced that it expects to raise its quarterly common stock dividend by 11% in the third quarter of 2026, increasing it to $0.50 per share from $0.45 per share. The planned increase is subject to approval by the company’s Board of Directors at its regular meeting in July.
Wells Fargo & Company (NYSE:WFC) is an American multinational financial services company that provides a wide range of banking, investment, and mortgage products and services. The company also specializes in consumer and commercial finance.
8. Newmont Corporation (NYSE:NEM)
Forward P/E: 9.36
Profit Margin: 33.87%
Net Income Available to Common (TTM): $8.46 Billion
Number of Hedge Fund Holders: 82
Newmont Corporation (NYSE:NEM) is one of the most profitable cheap stocks to buy right now. On July 2, Newmont Corporation (NYSE:NEM) said that it welcomes the Government of Canada’s decision to provide CA$500 million in funding to support the Red Chris Block Cave project.
The company said the commitment strengthens the business case for the development of a world-class copper-gold operation as the project moves through the approval process toward a final investment decision. Currently, the company is completing a Definitive Feasibility Study for the project. Newmont Corporation (NYSE:NEM) said the Red Chris Block Cave could increase Canada’s copper production by around 15%.
According to the report, the project is expected to extend the life of the Red Chris mine by about 14 years and also possibly provide a foundation for decades of additional mining opportunities.
The Red Chris mine is operated as a joint venture between Newmont Corporation (NYSE:NEM) and Imperial Metals. Newmont Corporation (NYSE:NEM) owns a 70% stake and serves as the operator, while Imperial Metals holds a 30% interest.
Newmont Corporation (NYSE:NEM) is a gold mining company that also produces copper, zinc, lead, and silver. It is one of the largest gold mining companies in the world.
7. Adobe Inc. (NASDAQ:ADBE)
Forward P/E: 8.41
Profit Margin: 28.69%
Net Income Available to Common (TTM): $7.23 Billion
Number of Hedge Fund Holders: 86
Adobe Inc. (NASDAQ:ADBE) is one of the most profitable cheap stocks to buy right now. On June 25, Adobe Inc. (NASDAQ:ADBE) announced that it has signed a definitive agreement to acquire Topaz Labs, an artificial intelligence company known for its advanced video and image enhancement models.
Topaz Labs offers industry-leading AI models that enhance existing photos and videos by sharpening details, removing noise, restoring footage, and improving resolution. These tools are important for any workflow that combines real-world capture with AI-generated visuals.
Adobe Inc. (NASDAQ:ADBE) said the acquisition will strengthen its video and image model offerings as the company will add Topaz Labs’ technology to Adobe Firefly, Firefly Services, and Creative Cloud applications. This will give creators, designers, photographers, video professionals, and enterprises access to more advanced tools for improving image and video quality across different formats and creative workflows.
Topaz Labs will also bring its Neurostream technology that allows large and advanced AI models to run locally on consumer devices. This will democratize advanced image and video models, which were previously available only for high-end systems or cloud-only usage. Adobe Inc. (NASDAQ:ADBE) will be able to tap into the expanding opportunity for efficient, on-device AI video.
Adobe Inc. (NASDAQ:ADBE) is a global leader in digital media and digital marketing solutions. It provides creator tools and services to individuals, teams, and enterprises to create, publish, and promote content.
6. Intuit Inc. (NASDAQ:INTU)
Forward P/E: 9.59
Profit Margin: 21.91%
Net Income Available to Common (TTM): $4.58 Billion
Number of Hedge Fund Holders: 92
Intuit Inc. (NASDAQ:INTU) is one of the most profitable cheap stocks to buy right now. As of July 6, 2026, Wall Street analysts remain positive on Intuit Inc. (NASDAQ:INTU), with the stock holding a consensus Buy rating. Analysts have set a median 12-month price target of $446.50, suggesting a potential upside of 62% from the current stock price.
Despite the overall positive outlook, some firms have recently turned more cautious. On June 18, Stifel downgraded Intuit Inc. (NASDAQ:INTU) from Buy to Hold and cut its price target from $375 to $275. The firm expects the management to reduce its near- to medium-term growth targets for both TurboTax and GBS when it reports Q4 results or during its September Analyst Day. Stifel also noted that the company has shifted to a value-based pricing strategy, particularly for lower-priced offerings, to help stall recent losses in market share.
Earlier, on June 2, Goldman Sachs also downgraded Intuit Inc. (NASDAQ:INTU) from Neutral to Sell and reduced its price target from $519 to $276. The firm pointed to growing competitive pressure in the tax business, which it believes could affect the company’s future performance.
Goldman Sachs said that “it may be challenging for Intuit to achieve its long-term financial targets, and Street estimates for the next 2 years that essentially reflect no deceleration in revenue growth rates.”
Intuit Inc. (NASDAQ:INTU) is an American multinational financial technology and business software company that offers a wide range of products and services.
5. Citigroup Inc. (NYSE:C)
Forward P/E: 13.14
Profit Margin: 20.36%
Net Income Available to Common (TTM): $14.7 Billion
Number of Hedge Fund Holders: 106
Citigroup Inc. (NYSE:C) is one of the most profitable cheap stocks to buy right now. On June 26, Truist increased its price target for Citigroup Inc. (NYSE:C) from $147 to $158 while keeping its Buy rating on the stock.
This update comes as part of a broader research note on universal and regional banks. Truist expects the company’s revenue to come in slightly above its guidance. The research firm also noted that if Citigroup Inc. (NYSE:C) can front-load its remaining severance budget for this year, expenses and efficiency could rise higher this quarter. However, this could help improve the company’s expense trend in the second half of the year.
Photo by osamu nakazawa on Unsplash
Earlier, on June 18, Wells Fargo lifted its price target on Citigroup Inc. (NYSE:C) from $162 to $165 and maintained an Overweight rating on the stock.
The research firm expects the company to outperform its 2026 return on tangible common equity (ROTCE) target. According to Wells Fargo, this outlook is supported by strong capital markets, payments, and net interest income, which continues to benefit from higher interest rates. The firm also believes Citigroup Inc. (NYSE:C) is likely to deliver better-than-expected second-quarter results.
Citigroup Inc. (NYSE:C) is a global financial services company that operates in over 180 countries and jurisdictions, providing corporations, governments, investors, institutions, and individuals with a wide range of financial products and services.
4. Bank of America Corporation (NYSE:BAC)
Forward P/E: 12.82
Profit Margin: 28.96%
Net Income Available to Common (TTM): $30.26 Billion
Number of Hedge Fund Holders: 106
Bank of America Corporation (NYSE:BAC) is one of the most profitable cheap stocks to buy right now. On June 30, Oppenheimer downgraded its rating on Bank of America Corporation (NYSE:BAC) from Outperform to Perform.
The research firm downgraded its rating on many US bank stocks, noting that rich valuations have left little room for further upside and that share prices already reflect much of the positive outlook for earnings and the overall business environment.
According to Oppenheimer, the banking sector has moved from years of structural undervaluation to valuations that now suggest optimism over sustained earnings growth. The firm pointed out that commercial banks are now trading near the high end of their historical valuation ranges, while investment banks are trading well above their long-term averages as investors expect strong investment banking activity and trading revenue.
Oppenheimer also raised its earnings estimates for the second quarter of 2026, pointing to better-than-expected trading performance. In addition, the firm increased its 2027 forecasts after raising its expectations for global investment banking activity. The brokerage now expects the investment banking “wallet” to reach about 46 basis points of US nominal GDP, which is estimated to be around 20% to 25% higher than a normal level.
Bank of America Corporation (NYSE:BAC) is a global banking and financial services corporation that offers banking, investing, asset management, and other financial and risk management products and services to individual consumers, small and middle-market businesses, and large corporations.
3. SanDisk Corporation (NASDAQ:SNDK)
Forward P/E: 11.93
Profit Margin: 34.19%
Net Income Available to Common (TTM): $4.51 Billion
Number of Hedge Fund Holders: 114
SanDisk Corporation (NASDAQ:SNDK) is one of the most profitable cheap stocks to buy right now. On July 1, BofA lifted its price target on Sandisk Corporation (NASDAQ:SNDK) from $2,100 to $2,500 and maintained its Buy rating on the stock.
The research firm expects the supply and demand imbalance in the NAND market to continue through 2027. As a result, pricing will stay “strong for longer” through mid-2027, although the pace of price increases is expected to slow over time on a quarter-over-quarter percentage rate basis.
A day earlier, on June 30, Bernstein analyst Mark Newman also increased the firm’s price target on Sandisk Corporation (NASDAQ:SNDK) to $3,000 from $1,700 and maintained an Outperform rating on the stock.
According to Bernstein, the new memory long-term agreements (LTAs) are more favorable for suppliers than older contracts. The new agreements include fixed or range-bound prices, longer terms, and upfront financial commitments to lock-in customers and protect against downside risk.
Sandisk Corporation (NASDAQ:SNDK) is an American computer technology company that designs and manufactures flash solutions and advanced memory technologies, including SSDs, memory cards, and USB Flash Drives.
2. JPMorgan Chase & Co. (NYSE:JPM)
Forward P/E: 14.88
Profit Margin: 33.94%
Net Income Available to Common (TTM): $57.51 Billion
Number of Hedge Fund Holders: 131
JPMorgan Chase & Co. (NYSE:JPM) is one of the most profitable cheap stocks to buy right now. On June 29, Morgan Stanley increased its price target on JPMorgan Chase & Co. (NYSE:JPM) from $336 to $362 and maintained its Equal Weight rating on the stock.
The research firm said it remains positive on the banks into the earnings season, even after the US banks have rallied quarter-to-date. According to Morgan Stanley, revenue momentum continues to build across the industry.
Earlier, on June 26, Truist analyst John McDonald lifted the firm’s price target on JPMorgan Chase & Co. (NYSE:JPM) from $332 to $344 and maintained a Hold rating on the stock.
McDonald noted that late-May guidance for total markets revenue growth of 11% or more year-over-year and investment banking fee growth of at least 10% or more year-over-year was not updated in early June. However, the analyst noted that activity levels since then suggest results could come in stronger than previously expected.
JPMorgan Chase & Co. (NYSE:JPM) is an American multinational financial services firm with leading positions in investment banking, financial services for consumers and small businesses, commercial banking, financial transaction processing, and asset management.
1. Micron Technology, Inc. (NASDAQ:MU)
Forward P/E: 7.52
Profit Margin: 55.91%
Net Income Available to Common (TTM): $50.47 Billion
Number of Hedge Fund Holders: 154
Micron Technology, Inc. (NASDAQ:MU) is one of the most profitable cheap stocks to buy right now. On June 29, Cantor Fitzgerald raised its price target on Micron Technology, Inc. (NASDAQ:MU) from $1,500 to $2,000 and maintained its Overweight rating on the stock.
This update came after the company’s disclosure of strategic customer agreements, which points to a more durable and extended memory cycle. Cantor Fitzgerald noted that as much as half of the company’s revenue could be secured through multi-year contracts with strong gross margins. This could improve pricing dynamics, lower quarter-end volatility in negotiations, and support more consistent long-term margins compared with previous industry cycles.
On the same day, Phillip Securities also increased its price target on Micron Technology, Inc. (NASDAQ:MU) from $530 to $1,870 and maintained its Buy rating on the stock.
The research firm expects the current memory shortage to continue beyond 2027. According to Phillip Securities, Micron Technology, Inc. (NASDAQ:MU) can enter into more agreements with new and existing customers in the coming quarters.
Micron Technology, Inc. (NASDAQ:MU) is a leading semiconductor technology company that is known for its innovative memory and storage solutions. The company offers a portfolio of high-performance DRAM, NAND, and NOR memory and storage products.
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