In this article, we will list the 5 Affordable Stocks to Buy With Good Earnings Growth. Please visit 8 Affordable Stocks to Buy With Good Earnings Growth if you would like to see the extended list and the methodology behind it.
5. Southwest Airlines Co. (NYSE:LUV)
Southwest Airlines Co. (NYSE:LUV) is one of the best affordable stocks to buy with good earnings growth. UBS cut the price target on Southwest Airlines Co. (NYSE:LUV) to $56 from $59 on March 23, reiterating a Buy rating on the shares. The firm told investors in a research note that jet fuel prices have risen toward $5/gallon on the Gulf Coast, which has prompted a preference for higher-quality airlines like Delta Air Lines (DAL) and United Airlines (UAL) with stronger margins. In the meantime, carriers with idiosyncratic demand drivers such as Southwest Airlines Co. (NYSE:LUV) may also fare relatively well. It also said that although March RASM gains were largely driven by favorable demand-supply conditions, increased fuel costs are expected to weigh on Q2 earnings, even with fare hikes contributing more to revenue.
Southwest Airlines Co. (NYSE:LUV) also received a rating update from Citi on March 20. The firm cut the price target on the stock to $44 from $54, reaffirming a Neutral rating on the shares and stating that it is updating estimates for higher fuel prices. It also sees downside risk to Q1, Q2, and 2026 estimates at nearly all airlines in its coverage. However, Citi also added that “downside to estimates does not necessitate downside to stocks across the board”, arguing that the fuel shock is likely to keep driving a “fuel wedge” driving meaningful relative outperformance at some airlines.
Southwest Airlines Co. (NYSE:LUV) is involved in the operation and management of a passenger airline. The company also provides ancillary services, including upgraded boarding, transportation of pets and unaccompanied minors, and early bird check-ins. Its operations are spread in the United States, the Commonwealth of Puerto Rico, Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.
4. Centene Corporation (NYSE:CNC)
Centene Corporation (NYSE:CNC) is one of the best affordable stocks to buy with good earnings growth. JPMorgan cut the price target on Centene Corporation (NYSE:CNC) to $41 from $45 on March 19, reiterating a Neutral rating on the shares. The firm considers the stock’s 16% selloff in the past week as a reminder that Managed Medicaid “remains the subsection of managed care (and perhaps healthcare services) with the widest error bars in 2026.” JPMorgan cut the stock’s estimates to take into account near-term uncertainty and assumed a 2027 Affordable Care Act exchange enrollment contraction.
In another development, Mizuho cut the price target on Centene Corporation (NYSE:CNC) to $41 from $47 on March 11, maintaining a Neutral rating on the shares and updating the company’s model after its fiscal Q4 report. The firm told investors in a research note that Centene Corporation’s (NYSE:CNC) shares were down 14% following the company’s comments at a competitor’s conference. Mizuho cited a more conservative valuation multiple pending greater clarity on the potential risk shifts if health insurance exchange dis-enrollment is worse than expectations for the target cut.
Centene Corporation (NYSE:CNC) is a healthcare enterprise that provides programs and services to government-sponsored healthcare programs. The company’s operations are divided into the following segments: Medicaid, Medicare, Commercial, and Other.
3. Flutter Entertainment plc (NYSE:FLUT)
Flutter Entertainment plc (NYSE:FLUT) is one of the best affordable stocks to buy with good earnings growth. On March 26, BTIG cut the price target on Flutter Entertainment plc (NYSE:FLUT) to $177 from $180, reiterating a Buy rating on the shares and telling investors in a research note that it is tweaking its US forecasts to match quarter-to-date trends, the company’s mix guidance for Arkansas launch headwinds, while also reducing its International estimates.
Flutter Entertainment plc (NYSE:FLUT) also received a rating update from Goldman Sachs on March 10. The firm cut the price target on the stock to $205 from $270, reaffirming a Buy rating on the shares. The firm told investors in a research note that the company reported disappointing Q4 results, which were driven by a U.S. miss tied to weaker promotional effectiveness, softer FY26 guidance, higher leverage, and reduced buybacks. It further attributed the recent U.S. softness to temporary NFL-related factors instead of prediction market cannibalization.
Flutter Entertainment plc (NYSE:FLUT) is involved in the business of online betting and gaming. The company’s operations are divided into the following segments: UK and Ireland, Australia, International, and the US.
2. Talen Energy Corporation (NASDAQ:TLN)
Talen Energy Corporation (NASDAQ:TLN) is one of the best affordable stocks to buy with good earnings growth. On March 23, Morgan Stanley cut the price target on Talen Energy Corporation (NASDAQ:TLN) to $472 from $474, keeping an Overweight rating on the shares. The firm told investors that it is updating price targets for Regulated & Diversified Utilities / IPPs in North America under its coverage. It also stated that utilities outperformed the S&P’s return in February, adding that the recent discussions in the space were broadly constructive, with companies highlighting growth opportunities along with optimism on load growth and signing deals with data centers.
In its fiscal Q4 and full year 2025 results, Talen Energy Corporation (NASDAQ:TLN) reported a full year GAAP net loss attributable to stockholders of $219 million, with a full year adjusted EBITDA of $1.035 billion and adjusted free cash flow of $524 million. Talen Energy Corporation (NASDAQ:TLN) also completed the Freedom and Guernsey acquisitions in November 2025, which raised the company’s generating capacity by around 2.8 gigawatts and provided efficient baseload generation and cash flow diversification.
Talen Energy Corporation (NASDAQ:TLN) is involved in the operation of power infrastructure. The company produces and sells electricity, capacity, and ancillary services into wholesale power markets via its subsidiaries.
1. Merck & Co., Inc. (NYSE:MRK)
Merck & Co., Inc. (NYSE:MRK) is one of the best affordable stocks to buy with good earnings growth. Merck & Co., Inc. (NYSE:MRK) and Terns Pharmaceuticals, Inc. announced on March 25 their entry into a definitive agreement under which Merck, through a subsidiary, will acquire Terns for $53.00 per share in cash for an approximate equity value of $6.7 billion. Management stated that this translates to around $5.7 billion net of acquired cash, representing an approximate premium of 31% to the 60-day and 42% to the 90-day volume-weighted average stock price on March 24, 2026.
Robert M. Davis, chairman and chief executive officer, Merck & Co., Inc. (NYSE:MRK), stated that the acquisition of Terns builds on the company’s growing presence in hematology with TERN-701, which is a potential best-in-class candidate to treat certain patients with chronic myeloid leukemia. He added that the transaction diversifies and bolsters Merck & Co., Inc.’s (NYSE:MRK) position in oncology, as it continues to look for opportunities that can help the company broaden its portfolio into other therapeutic areas.
Merck & Co., Inc. (NYSE:MRK) is a biopharmaceutical company that delivers health solutions to advance the treatment and prevention of diseases in animals and people. Its Pharmaceutical segment offers vaccines and human health pharmaceutical products, typically therapeutic and preventive agents. Its Animal Health segment develops, discovers, manufactures, and markets a range of vaccines and veterinary pharmaceutical products. The company’s medicine KEYTRUDA may treat certain cancers by working with the immune system.
While we acknowledge the potential of MRK to grow, 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 MRK and that has 100x upside potential, check out our report about the cheapest AI stock.
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