This article looks at the 13 Most Undervalued Stocks Under $20 to Buy.
The Nasdaq Composite slumped 3% last week, while the S&P 500 index was down 1.8% with leading AI stocks losing over $820 billion in market capitalization, as concerns over overvaluation sparked a substantial sell-off.
The plunge coincided with Goldman Sachs CEO David Solomon’s comments at an investment summit in Hong Kong on November 4, in which he expected a 10-20% market correction over the next 12 to 24 months. The statement was seconded by Morgan Stanley CEO Ted Pick, who anticipated a drawdown of anywhere between 10% to 15%.
Last week, Andrew Bailey, Governor of the Bank of England, also mentioned the likelihood of an ongoing AI bubble in the stock markets, while expressing doubts surrounding returns from the sector.
However, Skanska CEO Anders Danielsson has dismissed concerns of a slowdown, saying that the Swedish firm is still seeing a robust pipeline for new data centers in the United States, Europe, and the United Kingdom.
In other related news, on November 5, Torsten Slok, the chief economist at Apollo Global Management, talked to CNBC about the ‘bifurcation’ between the Magnificent 7 and the other 493 stocks on the S&P 500 index since the start of 2025, in terms of performance, earnings, and profit margins.
Slok displayed a graph showing that while earnings expectations for the Magnificent 7 had been climbing, the line for the S&P 493 was going down. He further emphasized that the broad market index was largely being driven by these leading technology stocks, which now make up about two-fifths of the market cap for the S&P 500. He described it as a problem for investors, since the index was not diversified enough due to the Magnificent 7’s high concentration.
With all the focus on the market’s stretched valuation, let’s shift focus and see some of the best undervalued stocks to buy now.
The New York Stock Exchange building. Photo by Дмитрий Трепольский on Pexels
Our Methodology
We used screeners to identify U.S.-based listed companies with a stock price under $20 and a forward P/E ratio of less than 15. The market cap criterion for this article was set to $2 billion or more. For the forward P/E ratio, we put a lower band of 7, because beyond this point, we may be stepping into deeply undervalued stocks that require further study to understand the reason for the discount. All data is as of the close of business on Thursday, November 6, 2025.
From this pool of companies, we selected the top 13 stocks with the highest number of hedge fund investors having a stake in them, based on Insider Monkey’s database of prominent hedge funds as of Q2 2025. We then ranked these stocks in ascending order of the number of hedge funds. Wherever two or more stocks had the same number of hedge funds, we used market cap as a tiebreaker between them.
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).
13 Most Undervalued Stocks Under $20 to Buy
13. Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX)
Share Price: $11.66
Forward P/E: 14.63
Number of Hedge Fund Holders: 28
Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX) is among the 13 Most Undervalued Stocks Under $20 to Buy. On October 31, Piper Sandler lifted its price target on the stock to $13 from $11, while maintaining an Overweight rating on its shares.
The adjustment followed the company’s third quarter 2025 earnings call on October 30. Piper Sandler noted the strong quarterly results that beat Wall Street’s estimates for both revenue and earnings.
Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX) reported a net revenue of $785 million, up 12% from the prior year’s period and beating forecasts of $774 million. The results reflected the strength of the company’s diversified business portfolio.
Speciality net revenue was up 8%, while revenue for Affordable Medicines also grew 8% during the quarter. AvKARE was another major contributor, with the segment top line surging 24% year-over-year.
Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX)’s net income stood at $54.4 million, improving substantially from a net loss of $50.6 million last year. Diluted EPS was posted at $0.17, beating estimates by four cents and up 6% year-over-year.
Adjusted EBITDA for the quarter was $160 million, up 1% year-over-year, driven by higher revenue. However, the figure was partially offset by investments on new launches and a raise in R&D expenditure.
The company also updated its guidance for the full year 2025. While net revenue is expected to remain in the same range of $3 billion to $3.1 billion, adjusted EPS is now anticipated between $0.75 and $0.80, up from the previous guidance of $0.70 to $0.75.
Moreover, the lower end of adjusted EBITDA has been raised by $10 million, with the new range now between $675 million and $685 million.
The stock has had robust returns in 2025, surging over 50% year-to-date.
Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX) is a biopharmaceutical company with expertise in developing, marketing, and distributing a wide range of medicines.
12. Banc of California, Inc. (NYSE:BANC)
Share Price: $17.10
Forward P/E: 14.15
Number of Hedge Fund Holders: 30
Banc of California, Inc. (NYSE:BANC) is among the 13 Most Undervalued Stocks Under $20 to Buy. On November 6, the company announced that it would pay a quarterly cash dividend of $0.10 per share to all common shareholders of record as of December 15, 2025. The payment is scheduled for January 2, 2026.
Moreover, according to the press release, all shareholders on record as of November 20 for the company’s Series F preferred stock will also receive a per-depository-share cash dividend of $0.4845 on December 1.
In other news, on October 27, Citigroup analyst Benjamin Gerlinger upgraded the stock’s rating to Buy from Hold and lifted the price target to $21.50 from $18 per share, citing a promising earnings outlook for fiscal 2026.
The firm also anticipates Banc of California, Inc. (NYSE:BANC)’s lending business, lower deposit costs, and asset repricing to continue supporting improvement in net interest margin (NIM). Moreover, Citigroup also added that the bank’s NIM could end up around the higher 3.40s next year if the Federal Reserve goes ahead with further rate cuts this year.
Banc of California, Inc. (NYSE:BANC) is a bank holding company that owns the Banc of California. It has a market cap of $2.71 billion and manages over $34 billion in assets. The stock has gained 13% year-to-date.
