In this article, we will look at the 14 Best Cheap Stocks to Buy for Beginners.
On September 11, Rich Saperstein, Treasury Partners’ founding principal and CIO, appeared on CNBC’s ‘Closing Bell’ to talk about how he’s advising his clients and much more.
He holds a bullish outlook and is invested in equities, stating that the current environment reinforces the benefits of holding stocks at this time. Inflation is moderating, the Fed is being accommodating, and the market saw a great Q2, GDP, and earnings.
READ ALSO: 13 Best Growth Stocks Under $50 to Buy Now and 10 Best Airport and Air Services Stocks to Buy.
Saperstein further stated that next year, we are going to have the benefits of deregulation, tax policy, and ease of permitting. Stocks, therefore, are at an all-time high to reflect a lot of the benefits in the investment climate, according to him.
He added that his clients are “fully invested” with an overweight in large-cap technology right now.
With these trends in view, let’s look at the best cheap stocks to buy for beginners.
Our Methodology
We sifted through ETFs and financial media reports to compile a list of the best beginner-friendly stocks with a forward P/E below 20. We then selected companies with a 10-year revenue CAGR of 7% to 15% (high single digits to mid-teens is our definition of a mature and reliable grower), which were the most popular among elite hedge funds, as of Q2 2025.
Note: All data was sourced on September 10.
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).
14 Best Cheap Stocks to Buy for Beginners
14. Royal Bank of Canada (NYSE:RY)
Forward P/E: 14.32
10-Year Revenue Growth: 6.97%
Number of Hedge Fund Holders: 28
Royal Bank of Canada (NYSE:RY) is one of the best cheap stocks to buy for beginners. On September 5, CIBC downgraded Royal Bank of Canada (NYSE:RY) to Neutral from Outperform, keeping the price target the same at C$208. The analyst noted that the firm considers consensus estimates for the sector “conservative”, and believes that the Canadian banks can continue to beat expectations.
However, Matthew Lee from Canaccord Genuity maintained a Buy rating on Royal Bank of Canada (NYSE:RY) on September 4, keeping the price target at C$219.00. Royal Bank of Canada (NYSE:RY) has an analyst consensus of Strong Buy.
Royal Bank of Canada (NYSE:RY) provides banking and financial services. The company’s operations are divided into the following segments: Personal and Commercial Banking, Wealth Management, Insurance, Capital Markets, and Corporate Support.
13. Stifel Financial Corp. (NYSE:SF)
Forward P/E: 15.59
10-Year Revenue Growth: 8.46%
Number of Hedge Fund Holders: 31
Stifel Financial Corp. (NYSE:SF) is one of the best cheap stocks to buy for beginners. On August 29, TD Cowen analyst William Katz maintained a Hold rating on Stifel Financial Corp. (NYSE:SF) and set a price target of $118.00.
Similarly, in a report released on July 31, Michael Cho from J.P. Morgan maintained a Hold rating on Stifel Financial Corp. (NYSE:SF), setting a price target of $125.00.
However, Citi upgraded Stifel Financial Corp. (NYSE:SF) to Buy from Neutral the same day, raising the price target to $135 from $115.
Stifel Financial Corp. (NYSE:SF) has an analyst consensus of Moderate Buy, and the stock’s median price target of $113.12 implies an upside of 12.71% from current levels.
Stifel Financial Corp. (NYSE:SF) provides investment banking, securities brokerage, investment advisory, trading, and related financial services. The company’s operations are divided into the following segments: Global Wealth Management, Institutional Group, and Other.
Hedge Fund Resource Center