Stock markets around the world have shown strong growth rates as the world economy recovers. You might be tempted to think that there are no bargains to be had. However, some stocks seem to be undervalued and could represent an opportunity for the investor. If you’re looking for cheap stocks to buy now, you’re in luck.
Are There Any Cheap Stocks Available?
Some high-performing stocks, like, Amazon and Alphabet, grab the headlines, as do many other hi-tech, cutting-edge companies. But shares in such companies tend to be expensive, even when results would not seem to warrant such a high price.
Shouldn’t these be ‘cheap,’ or rather, more affordable than they are?
Unfortunately, no. A stock market is a complex place. Experts track share performance, and demand sets the prices. Nevertheless, some shares escape serious scrutiny.
If you want to find traditionally affordable stocks, you’ll need to look outside the exciting world of hi-tech. In these sectors, the investor can find stocks at reasonable prices.
Where To Find Cheap Stocks
The key is to identify companies working in essential industries. These industries may not be as exciting as those operating in modern technology, but they meet a constant demand for their products. Some of these businesses may not be especially innovative, but they don’t need to be.
Be careful, though. There are various reasons why a stock is selling cheaply. Perhaps the company has had problems, the market is focusing on other sectors, or investors have doubts about its prospects.
Try to identify a long-standing company that is working in a field with growth potential. Has the company resolved any problems it may have had?
All that said, we followed our own advice and found five examples of cheap stocks you can buy today.
1. Aurora Cannabis
“Since 2013, with our strength in research and product innovation, we have continually pushed industry standards forward through state-of-the-art facility engineering, cannabis breeding, research, and industry-leading product development, creating brands that break through wherever they are launched.” (company website)
This business is something of an exception. It is a relatively new sector.
Experts are generally in agreement about the medicinal value of cannabis-based products, and governments have recognized this as more and more jurisdictions legalize the use of cannabis. The Canadian company, Aurora, is well-placed to take advantage of this trend.
Aurora has had some difficulties that have driven its share price lower than it should be. Under a relatively new Chief Executive Officer, the company is refocusing its efforts. The share price should rise if Aurora can develop its markets outside Canada.
There is strong competition in this sector, and there can be no guarantee that Aurora will come out on top. Nevertheless, it is worth monitoring stock as legalization efforts push through in different countries.
“We are a company focused on creating sustainable value by providing industry-leading products and solutions to satisfy the construction needs of our customers around the world. We strive to make the future better for our customers, our shareholders, and our communities by becoming the world’s most efficient and innovative building materials company.” (company website)
Mexican-based, multinational Cemex operates in over 30 countries. The company manufactures cement, concrete, and aggregates.
A third of Cemex’s sales come from the United States and the rest from around the world. Cemex has been around for over one hundred years and is very experienced in its field.
The new Biden infrastructure plan in the United States, coupled with other major construction projects around the globe, will boost demand for construction materials. Cemex is well-placed to take advantage of this.
“Our company is guided by our values of Safety, Accountability, Customer Service, Teamwork, and Integrity, and we have a passion for operational, commercial, and financial excellence, which is demonstrated by each employee through a personal commitment to continuous improvement.” (company website)
Enable Midstream, based in Oklahoma, is a developer and operator of energy infrastructure assets. They’ve positioned themselves in the market to be a “critical link” between downstream markets and major production areas.
Investing in energy is always a good idea. Energy demand will only increase.
However, Enable concentrates on natural gas and crude oil. Despite a shift towards greener energy, demand should continue to remain high for several years.
“We [operate] as one of the largest recyclers in North America and as one of the world’s most environmentally responsible steel producers.” (company website)
Gerdau is a Brazilian steel company that looks to create a more sustainable future through steel recycling efforts. It operates steel mills all over the United States and Canada, providing steel for the automotive, construction, and general industrial sectors. Its core business is to transform scrap steel and iron ore into steel products.
Gerdau should benefit from increased demand and favour as markets pick up and sustainable efforts become industry priority, like other companies in the sector.
5. ICL Group
“We are a leading global speciality minerals company that creates impactful solutions for humanity’s sustainability challenges in the global food, agriculture, and industrial markets.” (company website)
This Israeli company is a multinational that concentrates on chemicals and fertilizers. It emphasizes its focus on sustainability. With a fast-growing world population and a need to improve agricultural production, ICL’s financial results should improve yearly.
It is not difficult to find reasonably cheap stocks. The hard part comes in deciding why they are cheap. It could be that demand for the stock is low for a very good reason. Your job is to find out what that reason might be. It could be as simple as market presence to as complicated as a scandal.
The stocks mentioned above seem to only have slight problems and offer very good value. But share prices constantly fluctuate.
In general, though, don’t invest too heavily in cheap stocks. By all means, add them to your investment portfolio. It’s a nice way to see a potentially stellar return. But it can be a risky investment. Balance your investment with reliable performers.