10 Best Cheap Stocks to Buy Under $10

In theory, buying low-priced stocks seems to make sense. If a stock trades for less than, say, $10 per share, it’s much easier for an investor to accumulate a meaningful position in a stock with relatively few dollars. The hope, of course, is that the position will explode in value over time, because small fluctuations in the stock price can result in sizable gains.

In practice, however, buying low-priced stocks can be hazardous. The low-priced stock landscape is cluttered with untested upstarts, companies that have fallen on tough times run by managers who’ve made poor capital decisions, and shaky balance sheets. Low-priced stocks are often thinly traded, which only adds to their volatility. And you can’t have the potential for sizable gains without the other side of the coin: the potential for sizable losses.

For investors nevertheless interested in buying low-priced stocks, we recommend sticking with higher-quality companies whose shares trade on major exchanges, are trading below $10, and are also undervalued relative to their intrinsic worth. Why? For starters, quality companies generally have better staying power and stronger balance sheets, and buying stocks below what they’re worth helps to damp the price risk that often accompanies investing in low-priced stocks.

The names on our list of the best cheap stocks to buy under $10 therefore share two qualities:

• All these low-priced stocks earn Morningstar Economic Moat Ratings of at least narrow. That means we think these companies have established advantages that should allow them to fend off competitors for a decade or longer.
• These stocks look undervalued, which means they’re trading below Morningstar’s fair value estimates. Price risk is reduced when investors can buy the low-priced stocks on the cheap.

10 Best Cheap Stocks to Buy Under $10

These narrow- and wide-moat low-priced stocks all look undervalued, and their share prices were below $10 as of the market close on July 19, 2024.

1. Lithium Argentina LAAC
2. Arcadium Lithium ALTM
3. Altice USA ATUS
4. Hanesbrands HBI
5. Bayer BAYRY
6. Swatch Group SWGAY
7. Melco Resorts & Entertainment MLCO
8. Ambev ABEV
9. Sabre SABR
10. Sirius XM Holdings SIRI

Here’s a little bit about each of the best cheap stocks to buy under $10, along with some key Morningstar metrics. All data is through July 19.

Lithium Argentina

• Last Closing Price: $3.14
• Morningstar Price/Fair Value: 0.13
• Morningstar Uncertainty Rating: Very High
• Morningstar Economic Moat Rating: Narrow
• Industry: Other Industrial Metals and Mining
• Market Capitalization: $507.03 million

The cheapest stock on our list of the best stocks to buy below $10, Lithium Argentina is trading 87% below our fair value estimate of $25 per share. “We expect lithium demand to grow at nearly a 20% annual rate from over 900,000 metric tons in 2023 to over 2.5 million metric tons by 2030,” says Morningstar strategist Seth Goldstein.

Lithium Argentina is a pure-play lithium producer with two assets in Argentina. The company was created as a result of the former Lithium Americas separation, which separated the firm’s Argentina and North America businesses.

Cauchari-Olaroz is Lithium Argentina’s first and largest project. The firm owns a 44.8% interest in the project, while Ganfeng, one of the world’s largest lithium producers, owns 46.7%. The remaining 8.5% is owned by JEMSE, an Argentine state-owned mining company. The project recently entered production in 2023 and is in the process of ramping up production volumes to the project’s first-phase annual capacity of 40,000 metric tons. Additionally, management is planning to begin construction on a second phase for at least an additional 20,000 metric tons of annual lithium capacity. On a cost basis, Cauchari-Olaroz will be one of the lowest-cost producers in the world and will have a cost position similar to that of other Argentine brine assets in operation.

Lithium Argentina and Ganfeng are also developing a second resource in Argentina. This is in the Pastos Grandes basin, where Lithium Argentina and Ganfeng will likely combine three early-stage projects, which are directly adjacent to one another, into one single project. The three projects are Pastos Grandes, Sal de la Puna, and Pozuelos-Pastos Grandes. Lithium Argentina owns 85% of Pastos Grandes after selling a 15% stake to Ganfeng. Lithium Argentina also owns 65% of Sal de la Puna. Ganfeng owns the remaining stakes in the three projects. We forecast the single project to enter production early next decade and will likely have a low-cost position relative to the global cost curve but slightly higher than other Argentine brine projects, as early development studies indicate brine in the Pastos Grandes basin has a lower lithium concentration.

As electric vehicle adoption increases, we expect durable double-digit annual growth for lithium demand. Lithium Argentina should benefit as there should be more than enough demand for the company’s resources to enter production and expand capacity over time.

Arcadium Lithium

• Last Closing Price: $3.51
• Morningstar Price/Fair Value: 0.25
• Morningstar Uncertainty Rating: Very High
• Morningstar Economic Moat Rating: Narrow
• Industry: Specialty Chemicals
• Market Capitalization: $3.77 billion

The second lithium company on our list of the best cheap stocks to buy below $10, Arcadium Lithium stock looks 75% undervalued relative to our fair value estimate of $14 per share.

Arcadium Lithium is a pure-play lithium producer created in the Livent-Allkem merger in early 2024. The company is a top-five lithium producer globally by capacity on a lithium carbonate equivalent basis. Arcadium’s two lithium carbonate production resources in Argentina are among the world’s lowest-cost lithium sources on an all-in-sustaining cost basis.

As electric vehicle adoption increases, we expect high-double-digit annual growth for global lithium demand. Arcadium is looking to expand its Argentine brine-based lithium production capacity from around 40,000 metric tons per year in 2023 to 100,000 metric tons on a lithium carbonate equivalent basis by 2036. The growth will come from the expansion of its two existing resources, Fenix and Olaroz, and the development of the new brine resource, Sal de Vida. The company has a fourth Argentine brine resource at Cauchari that should progress through development and construction throughout the decade.

Lithium carbonate is produced by pumping brine out of the ground (primarily in South America) or via pegmatite mining that produces spodumene, which is later converted to lithium carbonate. Lithium hydroxide can be produced either from the conversion of carbonate or directly from spodumene.

Arcadium’s strategy is to produce both hydroxide and carbonate. Hydroxide is a higher-quality and typically higher-priced product. Arcadium is one of the lowest-cost carbonate producers globally but has a higher-cost position in hydroxide because of the additional conversion cost. Fully integrated hydroxide producers that start with high-quality spodumene assets can produce hydroxide at a lower cost than Arcadium, but Arcadium’s costs are still on the bottom half of the hydroxide cost curve.

Arcadium also owns lithium hard rock resources. Mount Cattlin produces spodumene, a lithium concentrate that is sold to converters who make the battery chemicals. The company is also developing two hard rock resources in Canada to expand its spodumene volumes over time. Arcadium plans to build spodumene processing capacity to fully integrate some of its spodumene production while continuing to sell the remaining spodumene to converters.

Altice USA

• Last Closing Price: $1.78
• Morningstar Price/Fair Value: 0.25
• Morningstar Uncertainty Rating: Very High
• Morningstar Economic Moat Rating: Narrow
• Industry: Telecom Services
• Market Capitalization: $818.73 million

Altice USA stock is undervalued, trading 75% below our $7 fair value estimate. Although the small company earns a narrow economic moat rating based on its efficient scale and cost advantage versus its rivals, we’ve assigned the stock a Very High Uncertainty Rating because of the company’s heavy debt load relative to its peers.

Altice USA has struggled to maintain revenue growth recently—more than cable peers Comcast and Charter—as it battles stiff competition from Verizon in the New York market and faces the broader incursion of fixed-wireless players into the broadband business. The firm has also taken a different approach to the business in recent years than other cable operators, with lackluster results. A new management team, largely hailing from Comcast, has slowly been improving the firm’s performance. We expect the firm’s networks will remain vital pieces of infrastructure that will generate strong, albeit slow-growing, cash flow over the long term. However, Altice USA also carries a very large debt load, leaving it little room for error.

Around 60% of Altice’s business is in the New York metro area, where favorable demographics have historically enabled the firm to claim high customer penetration rates and revenue per customer. The market is also far more competitive than average, though, as Altice faces competition from Verizon’s Fios network across more than half the territory. Altice is upgrading its network in Fios areas to fiber, eliminating any network advantage Verizon enjoys, but this effort hasn't paid off yet in terms of better customer or revenue growth. The rest of Altice’s territory covers mostly smaller markets and rural areas where demographics aren’t as favorable but fiber network competition is also more limited.

Like its cable peers, Altice has used its network advantage to steadily increase data speeds in recent years and claim more than half the internet access market in the territories it serves, providing a solid foundation for the business. However, missteps by the prior management team and the introduction of fixed-wireless broadband offerings from Verizon and T-Mobile have weighed heavily on Altice's ability to attract and retain customers. We believe the firm is taking appropriate steps to improve execution and that fixed-wireless growth will slow sharply in the coming quarters. Showing progress over the next few quarters is vital to regaining the confidence of the bond market to limit borrowing costs and maximize strategic flexibility.

Hanesbrands

• Last Closing Price: $5.40
• Morningstar Price/Fair Value: 0.34
• Morningstar Uncertainty Rating: Very High
• Morningstar Economic Moat Rating: Narrow
• Industry: Apparel Manufacturing
• Market Capitalization: $1.89 billion

Hanesbrands stock looks 66% undervalued, according to our metrics. Hanes’ key apparel brands have leading market shares in their categories in the United States, which helps the company earn a narrow economic moat rating. The company recently announced plans to sell its Champion brand. Morningstar senior analyst David Swartz says the move will allow the company to pay down debt and focus on its core innerwear brands.

Narrow-moat Hanesbrands is the market leader in basic innerwear in multiple countries. We believe its key innerwear brands like Hanes and Bonds (in Australia) achieve premium pricing. While the firm faces challenges from inflation, slowing demand for apparel, higher interest rates, and a highly competitive athleisure market, we think Hanes’ share leadership in replenishment apparel categories puts it in position for improving results in the coming years. In May 2021, the firm unveiled its Full Potential plan to bring growth back to innerwear, improve connections to consumers (through greater marketing and enhanced e-commerce, for example), and streamline its portfolio.

In June 2024, Hanes agreed to sell Champion to Authentic Brands Group. As Champion’s sales have been disappointing, Hanes’ management made the prudent decision to sell the brand to focus on its core basics. The proceeds, which could exceed $1 billion after taxes and other costs, should allow for faster debt reduction.

One of Hanes’ major initiatives is to improve the efficiency of its supply chain. It has already made progress in this area, having achieved a 15% increase in manufacturing output over the past five years. The company, unlike many rivals, primarily operates its own manufacturing facilities. More than 70% of the more than 2 billion apparel units sold by the firm each year are manufactured in its own plants or those of dedicated contractors. We believe the combination of strong pricing, new merchandise, and production efficiencies should allow Hanes to return to operating margins above 20% for its American innerwear business by 2026.

Bayer

• Last Closing Price: $7.12
• Morningstar Price/Fair Value: 0.38
• Morningstar Uncertainty Rating: High
• Morningstar Economic Moat Rating: Narrow
• Industry: Drug Manufacturers—General
• Market Capitalization: $28.12 billion

Bayer is the only drugmaker on our list of the best low-priced stocks to buy; it’s also one of the larger companies on our list. We think the market is overly concerned about litigation pressures and underappreciates the firm’s cost-cutting plan and growth potential from innovative products, argues Morningstar director Damien Conover. Bayer stock trades 62% below our fair value estimate of $18.50 per share.

Largely on the basis of the strong competitive advantages of the healthcare group and to a lesser extent the crop science business, we believe Bayer has created a narrow economic moat. Bayer is evaluating the divestitures of the crop science and consumer healthcare businesses, which appear to hold few synergies with the prescription drug business.

In the healthcare division, Bayer’s strong lineup of recently launched drugs and solid exposure to biologics should support steady long-term cash flows. Bayer’s hemophilia franchise and key ophthalmology drug Eylea are biologics. While competition is increasing in hemophilia and eyecare, the manufacturing complexity of these drugs helps to deter generic pressure. Also, new formulations of Eylea and hemophilia drugs hold the potential to keep competition at bay. Further, strong demand for cardiovascular drug Xarelto should continue to drive growth, but the drug’s key 2026 patent loss will likely create growth headwinds.

Bayer's healthcare segment also includes a consumer healthcare business with leading brands Aspirin and Aleve. Brand recognition is key in this unit, as evidenced by the company's iconic Aspirin, which continues to post strong sales even after decades of generic competition.

In addition to healthcare, Bayer runs a leading crop science segment, which includes crop protection products (pesticides, herbicides, fungicides) and the fast-growing plant and seed biotechnology business. Similar to the drug business, this segment is research and development intensive, and Bayer has developed a strong portfolio of products. The downside to this business is that demand is heavily dictated by weather and commodity prices, which will determine how much farmers can afford to spend on crop treatment. The acquisition of Monsanto has significantly expanded Bayer’s competitive position in this industry. On the negative side, the acquisition increased Bayer’s exposure to litigation around potential side effects from glyphosate use. While many studies have shown glyphosate use to be safe, some reports of linkage to cancer drove large class-action legal cases against Bayer and led to a legal settlement of over $15 billion.

Swatch Group

• Last Closing Price: $9.93
• Morningstar Price/Fair Value: 0.47
• Morningstar Uncertainty Rating: Medium
• Morningstar Economic Moat Rating: Narrow
• Industry: Luxury Goods
• Market Capitalization: $10.30 billion

The only luxury goods company on our list of the best cheap stocks to buy below $10, Swatch Group stock trades 53% below our $21.30 fair value estimate. The company’s pricing power helps underpin its narrow economic moat rating, explains Morningstar senior analyst Jelena Sokolova. First-half 2024 results have been weak because of sales declines in China, but we think this undervalued stock should appeal to patient, long-term investors, she adds.

The Swatch Group is the biggest vertically integrated Swiss watch manufacturer with 18 brands covering all price ranges, from entry to ultraluxury. Swatch-owned brands account for around 35% of Swiss watch exports, and the company supplies competitors with watch movements. Swatch Group’s luxury brands boast 100- to 200-year histories, iconic collections, and deep cultural heritage. Most of Swatch’s brands (at price points below $10,000) benefit from a cost advantage through scale and a higher degree of production automation. Swatch’s diversification in terms of brands and price points helps it to avoid the pitfalls that come with extending brands into categories where they don’t strategically belong and to potentially capture a positive mix as consumers trade up. However, we see a lack of control over distribution (a little less than 60% of sales are wholesale) as a weak spot for the company. Distributors are more likely to engage in discounting to maintain cash flows when demand sours, which we believe can be damaging for brands with long-shelf-life products. We believe that the demand for high-end watches is not structurally impaired (around 50% of revenue), branded jewelry offers attractive upside for growth (around 9% of revenue from the Harry Winston brand), while lower-priced watches (less than 20% of sales) are stabilizing and growing from a low base as the smartwatch category matures and innovation provides a boost.

The company is increasingly taking action to tackle costs in the low-end brands and limit grey market channels for high-end brands while investments in automation should help achieve higher profitability even with lower volumes. We expect Swatch Group’s sales to grow at a 4% pace over the long term (versus low-single-digit growth over the prior decade) with mid-single-digit growth for its higher-priced watch brands such as Omega, Longines, Breguet, and Blancpain, high-single-digit growth for jewelry brand Harry Winston, and low-single-digit growth for low-end watches (Tissot, Swatch, Mido, Hamilton, and so on).

Melco Resorts & Entertainment

• Last Closing Price: $6.17
• Morningstar Price/Fair Value: 0.53
• Morningstar Uncertainty Rating: High
• Morningstar Economic Moat Rating: Narrow
• Industry: Resorts and Casinos
• Market Capitalization: $2.70 billion

Melco Resorts and Entertainment stock looks 47% undervalued. We think the company maintains a narrow economic moat; it is only one of six primary concessionaries with a casino license in Macao (the only legal gaming hub in China), which is a valuable intangible asset that has a high regulatory barrier to entry, explains Morningstar senior analyst Jennifer Song. We think the stock is worth $11.60 per share.

We believe the gambling market in Macao will enjoy solid growth in the longer term. This structural tailwind is driven by the rising middle class in China and the penetration rate of less than 2% in Macao, compared with Las Vegas’ 13%. New hotel rooms by major operators in the next few years should accommodate increased and extended visits from bigger spenders from these provinces and drive the top line for integrated resort operators like Galaxy Entertainment. With the gradual ramp-up of traffic allowed on the Hong Kong-Zhuhai-Macao bridge, the new Hengqin border, and the Gongbei-to-Hengqin extension rail, Macao’s carrying capacity for tourists should increase. In addition, neighboring Hengqin Island, 3 times the size of Macao, is under rapid development to complement Macao’s growth.

As one of only six concession holders to operate casinos in Macao, Melco Resorts & Entertainment is ideally placed to benefit from this market dynamic, given its portfolio of properties catering to both mass-market and premium patrons. We think the firm’s strength in the premium mass segment and its leadership in product innovation, along with the launch of Studio City phase 2 in 2023 with 900 rooms, will drive a meaningful market share gain in midcycle.

Ambev

• Last Closing Price: $2.11
• Morningstar Price/Fair Value: 0.59
• Morningstar Uncertainty Rating: Medium
• Morningstar Economic Moat Rating: Wide
• Industry: Beverages—Brewers
• Market Capitalization: $33.26 billion

The only wide-moat stock on our list of the best cheap stocks to buy below $10, Ambev stock trades 41% below our $3.60 fair value estimate. The largest brewer in Latin America, Ambev benefits from both a cost advantage and intangible assets in its strongest markets and therefore earns a wide economic moat rating, explains Morningstar director Ioannis Pontikis.

Brahma, the Brazilian brewer, was the first foray into the consumer product manufacturing industry by private equity group 3G. In 2000, 3G merged two Brazilian brewers; Brahma and Antarctica, creating Ambev. The company has gone on to roll up brewers throughout Central and South America and holds several monopolylike positions in large markets, including an 81% volume share in Argentina, 68% in Brazil, and 61% in Peru.

In part because of the favorable industry structures, and in part because of its 3G heritage, Ambev is a highly profitable business. The company has a well-entrenched cultural focus on cost management, and implemented zero-based budgeting over a decade ago. Ambev’s largest market is Brazil, which represented 54% of total beverage net revenue and 49% of EBIT in 2022. However, until coronavirus-related social distancing measures prompted the closure of on-trade in some markets, Ambev's beer EBIT margin in Brazil had been in the mid-30% range, among the highest in the global beer industry, though it had faded from above 40% a decade ago. In 2022, that margin troughed at under 21% but recovered somewhat to just under 23% in 2023.

We believe rebuilding margins is important to the investment case. In our view, the most likely and significant boost to profitability would be a reversion to the historical mean of commodity costs. We estimate the company faced around BRL 3 billion in higher raw material costs in 2022, and a reversal of that by the end of 2024 would increase the gross margin by 3 percentage points, all else equal. In practice, we anticipate that some of the cost relief will be passed to the consumer, but lower costs will be beneficial to margins to a large degree.

Premiumization should be a long-term growth and margin driver. According to Euromonitor, the premium beer segment represented 16% of Brazil’s beer volume in 2022, around half of that of the US, and was responsible for most of the industry volume growth between 2016 and 2022. Ambev’s portfolio of local premium brands, as well as its access to Anheuser-Busch InBev’s global portfolio, positions it to benefit from a strong mix effect in the medium term.

Sabre

• Last Closing Price: $3.26
• Morningstar Price/Fair Value: 0.65
• Morningstar Uncertainty Rating: Very High
• Morningstar Economic Moat Rating: Narrow
• Industry: Software—Infrastructure
• Market Capitalization: $1.25 billion

Sabre stock is 35% undervalued relative to our fair value estimate of $5 per share. The only tech stock on our list of the best cheap stocks to buy under $10, Sabre is seeing improving demand and profits as business and international travel rebound following the coronavirus pandemic, reports Morningstar senior analyst Dan Wasiolek.

Despite near-term financing costs and long-term corporate travel demand uncertainty, we expect Sabre to maintain its position in global distribution systems, or GDS, over the next 10 years, driven by a leading network of airline content and travel agency customers as well as its solid position in technology solutions for these carriers and agents. Sabre’s 30%-plus GDS air transaction share is the second largest of the three companies (behind narrow-moat Amadeus AMADY and ahead of privately held Travelport) that together control about 100% of market volume. Sabre is also a leader in providing technology solutions to travel suppliers.

Sabre's GDS enjoys a network advantage, which is the source of its narrow moat rating. As more supplier content (predominantly airline content) is added, more travel agents use the platform, and as more travel agents use the platform, suppliers offer more content. This network advantage is solidified by technology that integrates GDS content with back-office operations of agents and IT solutions of suppliers, leading to more accurate information that is also easier to book. The company's platform reach should grow as Sabre continues to revitalize its technology and looks to expand with low-cost carriers and in countries where it previously had only minimal penetration, which are also markets with higher yields than the consolidated North American region.

Replicating Sabre’s GDS platform would entail aggregating and connecting content from several hundred airlines to a platform that is also connected to travel agents, which requires significant costs and time. Although we see GDS aggregation, processing, and back-office advantages as substantial, technology architectures like those of Etraveli enable end users to access not only GDS content but also supply from competing platforms, which could take some volume from companies like Sabre. Also, GDS faces some risk of larger carriers making direct connections with larger agencies, although we expect these relationships to be the exception rather than the rule and for Sabre to still be the aggregating platform in either case.

Sirius XM Holdings

• Last Closing Price: $3.41
• Morningstar Price/Fair Value: 0.68
• Morningstar Uncertainty Rating: Medium
• Morningstar Economic Moat Rating: Narrow
• Industry: Entertainment
• Market Capitalization: $13.10 billion

Rounding out our list of the best cheap stocks to buy under $10, Sirius XM trades 32% below our fair value estimate of $5 per share. The company earns a narrow economic moat rating largely because of the cost advantage of its satellite radio service.

Sirius XM Holdings consists of two businesses: SiriusXM and Pandora. SiriusXM transmits music, talk shows, sports, and news via its satellite radio network, primarily to consumers who pay a subscription fee, often tied to a vehicle. Its radios come preinstalled on a wide range of cars and trucks in the US. Most of the stations on the SiriusXM network are proprietary, differentiating the service from streaming music and terrestrial radio.

Most new cars with SiriusXM radios come with a 3- to 12-month trial period for the service. The conversion to self-pay after the trial is 37%, which represents the majority of new paid subscriptions. These customers have a monthly churn of 1.6%, implying a customer life of around five years. SiriusXM shares some of the revenue from self-pay customers with the automakers in the form of loyalty payments. Over the next five years, we expect that the satellite service will continue to expand, albeit slowly, by converting enough new- and used-car owners to self-pay to offset churn losses and by discounting the prices of subscriptions to retain customers.

Pandora, acquired in February 2019, is a streaming music platform that offers an ad-supported radio option and a paid on-demand service. Pandora still generates most of its revenue via advertising to consumers of its “radio” service, who listened to over 10.5 billion hours in 2023. The paid on-demand service only had 6 million paid subscribers in the US at the end of 2023, representing 4.5% of the estimated 133 million paid music service subscribers in the country, according to eMarketer.

Pandora moved into podcasting to differentiate its offering, but larger competitors like Spotify have already added podcasts to their services. As a result, the space has become increasingly crowded, and we don’t expect the move to generate significant growth or returns. We project that while Pandora will slowly expand its subscriber base over the next five years, the segment will continue to lose money as royalty payments will remain a drag on operating income.

What Are the Morningstar Fair Value Estimate and the Morningstar Uncertainty Rating?

Morningstar thinks that companies with economic moats possess significant advantages that allow them to successfully fend off competitors for a decade or more. Companies can carve out their economic moats in a variety of different ways—by having high switching costs, through strong brand identities, or by possessing economies of scale, to name just a few. Companies that we think can maintain their competitive advantages for at least 10 years earn narrow economic moat ratings; those we think can successfully compete for 20 years or longer earn wide economic moat ratings.

The Morningstar fair value estimate represents what Morningstar analysts think a particular stock is worth. Fair value estimates are rooted in the fundamentals and based on how much cash we think a company can generate in the future, not on fleeting metrics such as recent earnings or current stock price momentum.

What’s the Difference Between Undervalued Stocks and Low-Priced Stocks?

Though they may sound alike and are often used interchangeably, undervalued stocks and low-priced stocks usually mean two different things.

Undervalued stocks are stocks that are trading below some estimate of their worth; these stocks are often also called “cheap stocks.” In Morningstar’s terms, undervalued stocks are those that trade below Morningstar’s fair value estimates. But cheap stocks can also be those stocks with low price/earnings, price/book, or price/sales multiples. Think of them as stocks on sale.

Low-priced stocks, meanwhile, are typically stocks whose share prices fall below a particular dollar amount. In this article, we’re focusing on low-priced stocks with share prices below $10, for instance. Others may consider stocks trading below $5 or $25 to be low-priced stocks.

For purposes of this article, just remember: Not all low-priced stocks are undervalued, and not all undervalued stocks are low-priced.

How to Find More Cheap Low-Priced Stocks to Buy

This article focused on low-priced stocks trading below $10 that were undervalued from companies with economic moats. But the screening method used here certainly isn’t the only way to find cheap low-priced stocks to investigate further.

Investors can create their own list of undervalued low-priced stocks using the Morningstar Investor Screener. Beneath Investment Type, choose Stocks. Beneath Valuation, check both Price/Fair Value 0—0.5 and 0.5—1.0. Then, click on the cog in the results and use the search box to find Previous Close Price. Add that metric to your Columns list and hit the Update button. You now have a complete list of stocks that are undervalued by Morningstar’s price/fair value metric that you can sort based on the last close price. That will allow you to find stocks that are trading below $5, or below $25, or whatever price you consider to be low-priced.