In this article, we will look at the 8 Affordable Stocks to Buy With Good Earnings Growth.
On March 25, Jim Paulsen, former chief investment strategist at Leuthold Group, appeared on CNBC’s ‘Squawk on the Street’ to talk about the impacts of the Iran war and the stock market. Talking about the current scenario, he was of the opinion that no one really knows how this is going to go, and everyone is just trying to discount the news flow as it comes in. This is a reminder that there is risk regarding this war continuing much longer than was expected and getting much worse, which would prove detrimental to stocks and bonds. However, there is also a risk of being out of this market if there is any kind of relatively quick resolution to it, as we could see on the day and a few days before. Therefore, Paulsen believes that there is risk on all sides of this trade.
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He further stated that there is also concern about other parts, beyond oil, starting to rise, which he thinks is true, as it bleeds out. He also said that he went back 40 years and looked at eight oil spike-induced inflation pickups in the CPI, and this is one of the smaller ones. This type of oil price gain so far has led to just modest increases in the CPI in the past.
With these broader market trends in view, let’s look at the best affordable stocks to buy with good earnings growth.
Our Methodology
We used the Finviz stock screener to find stocks with a forward P/E below 15 with high EPS growth next year (over 25%). We selected the top 8 stocks with the highest number of hedge fund holders as of Q4 2025, sourcing the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund holders.
Note: All data was recorded on March 26.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
8 Affordable Stocks to Buy With Good Earnings Growth
8. TPG Inc. (NASDAQ:TPG)
TPG Inc. (NASDAQ:TPG) is one of the best affordable stocks to buy with good earnings growth. On March 24, BMO Capital cut the price target on TPG Inc. (NASDAQ:TPG) to $48 from $60, reiterating an Outperform rating on the shares. The rating update came as part of a broader research note on Alternative Asset Manager names, with the firm telling investors that issues are piling up, with uncertainty around realizations increasing with credit issues at Asset-Based Finance markets, BDC redemptions, AI-driven disruption weighing on performance, and market volatility. The firm further stated in the research note that credit spreads are also widening, and fraud allegations raise questions around underwriting and downside protection.
In another development, TPG Inc. received a rating update from Barclays on March 2. The firm cut the price target on the stock to $56 from $69, reiterating an Overweight rating on the shares and telling investors in a research note that it revised estimates across the alternative asset manager group. The firm also stated that although it is too early to ascertain the real AI impact on portfolio companies, it lowered business development company-related earnings on lower flow assumptions and realization.
TPG Inc. operates as a global, diversified alternative asset management firm. The firm’s investments span across five multi-product platforms: Capital, Growth, Impact, Real Estate, and Market Solutions.
7. Stellantis N.V. (NYSE:STLA)
Stellantis N.V. (NYSE:STLA) is one of the best affordable stocks to buy with good earnings growth. On March 20, Citi cut the price target on Stellantis N.V. (NYSE:STLA) to EUR 7 from EUR 8, reiterating a Neutral rating on the shares. The stock also received a rating update from Citi on March 19. The firm cut the price target on Stellantis N.V. to EUR 7 from EUR 8, reaffirming a Neutral rating on the shares while also adding an “upside 90-day catalyst watch” on the stock. It told investors in a research note that the firm is continuing to adopt a cautious stance on the shares because of concerns surrounding U.S. and European profitability. However, Citi added that the stock can experience a change in investor sentiment after dropping 39% in 2026.
For perspective, in its full-year 2025 financial results, Stellantis N.V. reported net revenues of €153.5 billion, down 2% compared to 2024, attributed primarily to FX headwinds and also from H1 2025 net pricing declines. The company also reported a net loss of €22.3 billion due to €25.4 billion of full-year unusual charges.
Stellantis N.V. designs, manufactures, distributes, and sells vehicles. The company offers products under various brands, including Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS, Fiat, Fiat Professional, Jeep, Lancia, Opel, Peugeot, Ram, and Vauxhall.
6. Smurfit Westrock Plc (NYSE:SW)
Smurfit Westrock Plc (NYSE:SW) is one of the best affordable stocks to buy with good earnings growth. Goldman Sachs initiated coverage of Smurfit Westrock Plc (NYSE:SW) with a Buy rating on March 24, setting a price target of $49. The firm stated that it started coverage of the European pulp, paper, and packaging sector, anticipating a continuation of “low-cycle conditions, most notably for the upstream names”. The firm recommends a defensive position with a preference for more downstream names.
In a separate development, Smurfit Westrock Plc announced the completion of an asset purchase agreement of Cartomanabí, which is one of the main corrugated packaging companies in Ecuador. Management stated that the acquisition marks a strategic step forward in the company’s goal of expanding in the region, and bolsters its position as the number one corrugated supplier in Latin America. Smurfit Westrock Plc further stated that with the paper supplied from its North American mill system, it increases its integration.
Smurfit Westrock Plc develops and provides packaging solutions. The company’s products include corrugated sheet boards, corrugated packaging, solid boards, and hexacomb packaging.
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. 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. 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. 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 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 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 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 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 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 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. 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., 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 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. 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.
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