In this article, we will take a look at the 8 Cheap Beginner Stocks to Buy Right Now.
Talk of a slowing economy has once again gained popularity within economic circles. According to a CNBC research, the word “recession” and its variants have been used on 150 S&P 500-listed earnings calls so far in 2025, roughly twice as many as during the same time period last year. The University of Michigan’s widely monitored consumer sentiment index has fallen to almost its lowest points ever as the announcements of tariffs have unsettled regular Americans.
Companies have also expressed concern that tariffs would negatively impact their bottom lines and force them to raise prices in order to cover increased costs. Some further claimed that customers had tightened their financial belts due to growing concerns of a recession brought on by the charges. Furthermore, after initially announcing his proposal for sharp and broad tariffs on numerous nations and territories, President Trump threw U.S. financial markets into an uproar in April, which market investors feared would reduce consumer spending. Soon after, he put a number of those duties on hold, which allowed the market to recover a large portion of its losses. During this reprieve, which ends early next month, the White House continues negotiating agreements with countries.
Following this, the market appears to be doing better, according to a New York Federal Reserve survey that was made public on June 9. The results indicated that following Trump’s retraction of some of his more aggressive trade policies, the average consumer is becoming less worried about inflation.
With this in mind, let’s take a look at the 8 cheap beginner stocks to buy right now.
Our Methodology
We sifted through stock screeners and media reports to compile our list of cheap stocks that are trading at a forward price-to-earnings ratio of less than 15 as of June 9. This indicates that the equity is undervalued when compared to its estimated future earnings. These stocks are ranked according to hedge fund sentiment, as of Q1 2025.
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).
8. Quaker Chemical Corporation (NYSE:KWR)
Forward Price-to-Earnings Ratio: 13.77
Number of Hedge Fund Holders: 25
Quaker Chemical Corporation (NYSE:KWR) is one of the 8 cheap beginner stocks to buy right now. On June 9, Quaker Chemical Corporation (NYSE:KWR) was upgraded from Hold to Buy by Jefferies analysts. In keeping with its optimistic assessment of the company’s performance, the firm also increased its price target from $115 to $146.
Despite challenges in the end markets, Jefferies analysts emphasized Quaker Chemical’s strong margins and return on capital employed (ROCE), which are still higher than 2019 levels. Over the course of four years, they observed a notable decline in the company’s EV/EBITDA, which has caused share prices to drop to levels comparable to those at which earnings per share were less than $5.
According to the analysts, Quaker Chemical Corporation (NYSE:KWR) is a “good quality-at-a-reasonable-price candidate,” with a free cash flow yield of 7%. By highlighting the company’s competitive edge and cyclical leverage, they predict that earnings will likely grow in 2026.
Jefferies also believes that Quaker Chemical’s shares may rerate relative to its peers, which may mean that the stock could reach $245 in 2027. In the best-case scenario, analysts predict that KWR could triple by 2030.
Quaker Chemical Corporation (NYSE:KWR) is a global provider of industrial products for heavy manufacturing sectors. The company offers a wide range of products, with a focus on rolling lubricants, hydraulic fluids, forming and forging fluids, corrosion inhibitors, and metal removal fluids.
7. Incyte Corporation (NASDAQ:INCY)
Forward Price-to-Earnings Ratio: 10.40
Number of Hedge Fund Holders: 37
Incyte Corporation (NASDAQ:INCY) is one of the 8 cheap beginner stocks to buy right now. At the 46th Annual Global Healthcare Conference hosted by Goldman Sachs on June 9, Incyte Corporation (NASDAQ:INCY) delivered a presentation, detailing its long-term strategic goals. The company highlighted its growing pipeline and expected revenue growth from new pharmaceutical launches while addressing the imminent loss of exclusivity for its main medicine, Jakafi.
In Q1 2025, Jakafi grew 24% year-over-year. According to management, three factors contributed to this growth. 10% came from demand, 7% from net pricing, and 7% from less destocking this year than in the same quarter last year. Looking ahead, Incyte Corporation (NASDAQ:INCY) anticipates that demand will be the only factor driving growth for the remainder of the year.
To broaden its portfolio beyond Jakafi, however, the company intends to introduce four new products or indications in 2025, with the goal of generating an extra $1 billion in revenue by 2029.
Incyte Corporation (NASDAQ:INCY), an American global pharmaceutical company, operates as a market leader in developing treatments for patients suffering from various diseases, including cancer.
6. Gates Industrial Corporation plc (NYSE:GTES)
Forward Price-to-Earnings Ratio: 13.18
Number of Hedge Fund Holders: 40
Gates Industrial Chemical Corporation (NYSE:GTES) is one of the 8 cheap beginner stocks to buy right now. Jeffrey Hammond, a KeyBanc analyst, raised his price target for Gates Industrial Chemical Corporation (NYSE:GTES) from $23 to $26 on June 9 while maintaining the stock’s rating of Overweight. This decision comes after meetings with investors and meetings with Ivo Jurek, the company’s CEO. Gates Industrial is effectively controlling manageable elements to boost earnings without depending on higher volume, even as demand trends are erratic. By innovating and gaining market share, the company is also appears to be growing in its markets.
Even in the absence of a notable end-market rebound, Hammond stated he is now more confident that Gates Industrial Chemical Corporation (NYSE:GTES) will be able to meet its margin targets by the end of 2026. This confidence is a result of the company’s proven ability to improve profit margins and penetrate more markets.
Gates Industrial Chemical Corporation (NYSE:GTES) is a multinational producer of fluid power and power transmission solutions. The company supplies products to original equipment manufacturers (OEMs) as well as replacement channel clients in a variety of industrial and consumer markets.
5. First Horizon Corporation (NYSE:FHN)
Forward Price-to-Earnings Ratio: 10.85
Number of Hedge Fund Holders: 41
Incyte Corporation (NASDAQ:INCY) is one of the 8 cheap beginner stocks to buy right now. On June 9, RBC Capital Markets maintained its Outperform rating on First Horizon Corporation (NYSE:FHN) while modifying its outlook, increasing the bank’s price target from $22 to $24. The change followed recent meetings with First Horizon’s top executives—CFO Hope Dmuchowski, Head of Investor Relations Tyler Craft, and Chairman, President, and CEO Bryan Jordan.
The management team focused on a stabilization in deposit costs during the talks, which they stated should help maintain a stable margin. They also talked about possible strategies to lessen the impact in the event that the Fed lowers interest rates again.
Additionally, RBC Capital’s analysis indicates that First Horizon’s management is focusing on internal operations and strategy, even if investors were interested in mergers and acquisitions (M&A) and the importance of exceeding the $100 billion asset benchmark. According to RBC, the revenue outlook remained stable even with some slowdown in near-term industry lending activity.
First Horizon Corporation (NYSE:FHN) is a financial holding corporation with headquarters in Tennessee. Its primary business divisions include Corporate, Specialty Banking, and Regional Banking.
4. Hewlett Packard Enterprise Company (NYSE:HPE)
Forward Price-to-Earnings Ratio: 8.64
Number of Hedge Fund Holders: 45
Hewlett Packard Enterprise Company (NYSE:HPE) is one of the 8 cheap beginner stocks to buy right now. Loop Capital Markets revised its financial outlook for Hewlett Packard Enterprise Company (NYSE:HPE) on June 9, maintaining its Hold rating on the company’s shares while increasing the price target from $16 to $18. The change was made in response to HP Enterprise’s April quarter financial release, which showed a robust server revenue performance.
With a revenue of $4.1 billion, HP Enterprise’s server division recorded a 7% year-over-year gain. Although traditional server volumes declined by 5% on a quarter-over-quarter basis, this growth was somewhat offset by higher average unit pricing. Notably, with a significant increase in the enterprise and sovereign market segments—where enterprise orders made up one-third of the total—HP Enterprise received $1.1 billion in net new orders in the AI server segment. The hybrid cloud market also performed well, as evidenced by the triple-digit annual growth of HP Enterprise’s Alletra product line.
Given the improvements, Hewlett Packard Enterprise Company (NYSE:HPE) has adjusted its fiscal year 2025 revenue projection, reducing the range of anticipated year-over-year revenue growth from 7–11% to 7-9%.
Hewlett Packard Enterprise Company (NYSE:HPE) provides data services globally through its several divisions, including Corporate Investments, Compute, HPC & AI, Storage, Intelligent Edge, and Financial Services. Additionally, the company offers software-defined infrastructure (SDI) solutions to help businesses with software development and deployment, automation, network management, and storage.
3. Centene Corporation (NYSE:CNC)
Forward Price-to-Earnings Ratio: 7.03
Number of Hedge Fund Holders: 64
Centene Corporation (NYSE:CNC) is one of the 8 cheap beginner stocks to buy right now. On June 9, Morgan Stanley analysts began covering Centene Corporation (NYSE:CNC) with an Overweight rating and a $70 price target. The analysts emphasized Centene’s status as a prominent managed care provider, particularly within the Medicare Advantage, Medicaid, and Individual Exchange programs.
Centene’s robust footprint in the Medicaid market is a significant asset, the analysts pointed out, despite the program’s difficulties, which include financing instability and state rate-member acuity mismatch. In order to support long-term growth, they also highlighted possible expansion prospects in the ICHRA market and D-SNP integration.
Morgan Stanley also highlighted the possibility of ongoing cost reductions along with faster growth in better margin categories, which might eventually result in margin increase. The firm predicts that over the next three years, these elements combined with capital deployment will sustain an EPS compound annual growth rate of 8.8%.
Centene Corporation (NYSE:CNC), headquartered in St. Louis, Missouri, is a managed care company that serves as a middleman between government-sponsored and privately insured healthcare programs.
2. The Kroger Co. (NYSE:KR)
Forward Price-to-Earnings Ratio: 12.69
Number of Hedge Fund Holders: 64
The Kroger Co. (NYSE:KR) is one of the 8 cheap beginner stocks to buy right now. On June 9, UBS reiterated its Neutral rating on The Kroger Co. (NYSE:KR), keeping its price target at $66. As the retailer gets closer to its first-quarter earnings release, which is set for June 20, the firm’s analysis hints at a mixed picture.
According to the firm, the market is likely to concentrate on a few important issues of Kroger’s performance. Among these is Kroger’s competitive position in the market, where it continues to have a leading position in the distribution and retail of consumer staples. In the near to immediate term though, Kroger’s market performance may be impacted by a number of possible catalysts and obstacles, according to UBS, creating a scenario with a balanced risk-reward ratio.
Additionally, Kroger’s margins will be carefully assessed with an emphasis on the company’s capacity to maintain the high gross margin momentum. Management has demonstrated high returns for shareholders through its aggressive share buyback program and steady dividend payments, which have been sustained for 20 years in a row. Furthermore, UBS expects investors to be interested in any new strategic developments, although major changes are not anticipated at this time.
The Kroger Co. (NYSE:KR) is an American retailer with over 2,700 supermarkets and multi-department stores in 35 states across the US.
1. QUALCOMM Incorporated (NASDAQ:QCOM)
Forward Price-to-Earnings Ratio: 12.95
Number of Hedge Fund Holders: 82
Qualcomm Incorporated (NASDAQ:QCOM) is one of the 8 cheap beginner stocks to buy right now. On June 9, Qualcomm Incorporated (NASDAQ:QCOM), which is growing into the rapidly expanding AI data center industry, agreed to buy Alphawave for approximately $2.4 billion.
While Apple ranks as one of Qualcomm’s key customers, the iPhone manufacturer’s increasing uses of in-house processors has led to the semiconductor company to expand its focus on serving industries like data centers and personal computers.
The same day, Qualcomm Incorporated (NASDAQ:QCOM) also made two other all-share proposals for Alphawave. However, Alphawave intends to unanimously recommend the offer to its investors, believing it to be reasonable and fair. Jefferies analysts stated that given Alphawave’s exit from its Chinese joint venture, WiseWave, they do not anticipate any significant regulatory barriers to the sale. The deal is expected to close in Q1, 2026 depending on regulatory approvals.
In a statement regarding this acquisition, Cristiano Amon, president and CEO of Qualcomm, said the following:
“Qualcomm’s advanced custom processors are a natural fit for data center workloads. The combined teams share the goal of building advanced technology solutions and enabling next-level connected computing performance across a wide array of high growth areas, including data center infrastructure.”
QUALCOMM Incorporated (NASDAQ:QCOM) is a well-known American manufacturer of semiconductors and telecom equipment. The company supplies chips to major companies in a number of high-growth industries, including smartphones and autonomous vehicles.
While we acknowledge the potential of QCOM 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 QCOM and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None.
