In this article, we will look at the Top 10 Cheap Stocks With Strong Buy Ratings on Wall Street.
On June 1, Tom Lee, Fundstrat managing partner and head of research, and Fundstrat Capital CIO, appeared on CNBC’s ‘Squawk Box’ to talk about the latest market trends, the market outlook, and more.
June is when he expects market breadth to improve, and acknowledged that while it has indeed been a tough market, he was expecting 2026 to be a year where turbulence could happen. However, Lee believes that there are still some powerful tailwinds for America, with the AI story being one of them.
READ ALSO: 9 Best Inexpensive Stocks to Invest In Right Now AND 10 Best Stocks to Buy Now for Long Term Growth.
He added that we are now learning about energy independence; America can deal with higher oil prices because there is not going to be a shortage of it. Additional tailwinds are coming as well, as AI moves downstream are really benefiting American businesses. He thinks this is why S&P earnings came $10 higher in just the first quarter. That is $40 a year, and if you just put a 20 multiple, that adds 800 points to the S&P. He thus thinks that there is a lot of grounding for why stocks are able to recover.
With these broader market trends in view, let’s look at the top cheap stocks with Strong Buy ratings on Wall Street.
Our Methodology
We used the Finviz stock screener to identify the best stocks with a forward P/E below 15 and analyst consensus Strong Buy ratings. We then selected the top 10 stocks most popular among hedge funds as of Q1 2026, using the hedge fund sentiment data from Insider Monkey’s database. The stocks are arranged in ascending order of hedge fund sentiment.
Note: All data was recorded on June 3.
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. Insider Monkey’s quarterly newsletter strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
Top 10 Cheap Stocks With Strong Buy Ratings on Wall Street
10. NetEase, Inc. (NASDAQ:NTES)
Number of Hedge Fund Holders: 23
NetEase, Inc. (NASDAQ:NTES) is one of the top cheap stocks with Strong Buy ratings on Wall Street. Morgan Stanley lifted the price target on NetEase, Inc. (NASDAQ:NTES) to $158 from $154 on May 26 and maintained an Overweight rating on the shares. The firm stated that its revenue estimates are staying “largely unchanged”, but it is increasing its net profit estimates over 2026-28, incorporating the stronger gross profit margin in Q1 and better operating expense management.
The rating update came after NetEase, Inc. (NASDAQ:NTES) announced unaudited results for fiscal Q1 2026, reporting that net revenues were RMB30.6 billion (US$4.4 billion), reflecting a growth of 6.1% compared with the same quarter of 2025. Games and related value-added services net revenues came up to RMB25.7 billion (US$3.7 billion), up 6.9% compared to the prior year period. Management further reported that gross profit for the quarter was RMB21.2 billion (US$3.1 billion), up 14.8% compared to the prior year period, while total operating expenses were RMB8.6 billion (US$1.2 billion), up 6.5% compared with the same quarter of 2025.
NetEase, Inc. (NASDAQ:NTES) is an internet technology company that provides premium online services related to community, content, communication, and commerce. The company\s operations are divided into the following business segments: Online Game Services, Youdao, Cloud Music, and Innovative Businesses and Others.
9. Royal Bank of Canada (NYSE:RY)
Number of Hedge Fund Holders: 32
Royal Bank of Canada (NYSE:RY) is one of the top cheap stocks with Strong Buy ratings on Wall Street. Scotiabank lifted the price target on Royal Bank of Canada (NYSE:RY) to C$275 from C$252 on June 1 and maintained an Outperform rating on the shares. The company also received a rating update from Barclays on May 29. The firm lifted the price target on Royal Bank of Canada (NYSE:RY) to C$260 from C$245 and maintained an Overweight rating on the shares. The rating updates came after the bank reported financial results for fiscal Q1 2026 on May 28.
In its financial results for the quarter ended April 30, 2026, the company reported net income of $5.5 billion, up $1,119 million or 25% from the previous year. Diluted EPS rose 27% over the same period to $3.85, highlighting growth across each of Royal Bank of Canada’s (NYSE:RY) business segments. Adjusted net income and adjusted diluted EPS for the quarter were $5.6 billion and $3.90, up 23% and 25%, respectively, from the prior year.
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.
