On October 7, Ed Yardeni, Yardeni Research, joined ‘Closing Bell’ on CNBC to discuss what investors should focus on with stocks and suggested that valuations are high, but earnings have been remarkably strong. Yardeni stated that the market currently has a bubble in bubble fears, while acknowledging there are clearly elements of a real bubble. He cited two valuation metrics: the forward P/E of the S&P 500 is currently about 23, which is nearing the 25 peak seen during the late 1990s/early 2000s tech bubble; and the Buffett ratio is at a record high.
He concluded that valuation is definitely high, but is being justified by remarkably strong earnings, which he expects to continue to drive the market and sustain current valuations, as the market is discounting a very resilient economy. Talking about whether the potential for a bubble is irrelevant as long as earnings are good and investors will likely play the hand they’re dealt, Yardeni agreed and advised investors to focus on the fundamentals of companies. He noted that profit margins have been remarkably high in the face of tariffs, and corporate managements have done an astounding job of kind of dealing with Washington. He offered a contrasting perspective to those who worry about Washington’s impact on the economy.
That being said, we’re here with a list of the 13 cheap stocks to buy for the next 5 years.
Our Methodology
We sifted through the Finviz stock screener to compile a list of cheap stocks with a forward P/E ratio under 15. Then, for the 13 best stocks for the next 5 years, we included stocks with an average expected EPS growth of at least 25% over the next 3 to 5 years, according to Wall Street estimates. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q2 2025.
Note: All data was sourced on October 7.
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).
13 Cheap Stocks to Buy For the Next 5 Years
13. OPAL Fuels Inc. (NASDAQ:OPAL)
Forward P/E Ratio as of October 7: 3.84
EPS Forward Long Term Growth (3-5 Year CAGR): 116.00%
Number of Hedge Fund Holders: 11
OPAL Fuels Inc. (NASDAQ:OPAL) is one of the cheap stocks to buy for the next 5 years. On October 6, OPAL Fuels and the Atlantic County Utilities Authority/ACUA announced that a Renewable Natural Gas/RNG facility in Egg Harbor Township, New Jersey, had achieved commercial operation. This facility is located at the ACUA’s solid waste landfill and captures & processes landfill gas into RNG.
RNG serves as a lower-carbon fuel alternative to diesel and conventional natural gas for transportation. The facility has a nameplate capacity of 2,500 standard cubic feet per minute/SCFM of landfill gas and is expected to produce over 650,000 MMBtu, or more than 4.6 million GGE of RNG annually.
The project is the first to deliver RNG into the pipeline system of South Jersey Gas, which is a subsidiary of SJI. For the ACUA, it is the first time a public solid waste facility in New Jersey has hosted an RNG project. The facility reduces emissions, improves air quality, creates jobs, and strengthens American energy independence.
OPAL Fuels Inc. (NASDAQ:OPAL) produces and distributes renewable natural gas/RNG for use as a vehicle fuel for heavy and medium-duty trucking fleets throughout the US.
12. Allegiant Travel Company (NASDAQ:ALGT)
Forward P/E Ratio as of October 7: 7.96
EPS Forward Long Term Growth (3-5 Year CAGR): 46.36%
Number of Hedge Fund Holders: 23
Allegiant Travel Company (NASDAQ:ALGT) is one of the cheap stocks to buy for the next 5 years. On October 3, Susquehanna raised the firm’s price target on Allegiant Travel to $65 from $50, while keeping a Neutral rating on the shares as part of its Q3 2025 earnings preview for the airlines group.
Earlier for Q2 2025, Allegiant Travel reported that the company’s revenue reached $669 million, which was ~3% above the prior year’s figure. The company achieved an operating margin of 8.6%, successfully exceeding its initial guidance, contributing to a first-half operating margin close to 9%, an improvement over the previous year.
Fleet changes included the retirement of 2 A320 series aircraft and the delivery of 5 new 737 MAX aircraft. The company’s financial position included $853 million in cash and investments, and a total debt of just below $2 billion, resulting in a net leverage of 2.6 times. Allegiant was also named Skytrax’s best low-cost carrier in North America for the second consecutive year.
Allegiant Travel Company (NASDAQ:ALGT) is a leisure travel company that provides travel and leisure services and products to residents of underserved cities in the US.
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