Investing in equities — publicly traded stocks — and holding them for the long run is a proven strategy for building wealth over time. Stocks offer investors the opportunity to share in the growth of a company and to generally participate in the expansion of the U.S. and world economies. While investing does involve risk, history shows us that the stock market trends higher over extended periods.
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All of which is to say that equities are a smart choice when it comes to investing long-term capital. Stocks go up and down with the market and fundamental factors, but, as an asset class, they tend to outperform more conservative vehicles like government bonds and deposit accounts. The key to success in the equity markets is to diversify and take a disciplined, long-term approach.
Most people are familiar with the old adage “buy low, sell high.” Accordingly, the current market price is one of the first things individual investors look at when they think about buying a stock. A stock’s price is a critical factor, but price alone doesn’t tell the whole story. There are other, more important things to consider. For instance, a company’s balance sheet, current and estimated revenue and earnings, as well as its relative position in its sector, should be thoroughly reviewed before you click the “buy” button.
That does not mean you should necessarily avoid cheap stocks trading at under $5 — many low-priced stocks offer compelling value — it only means that a low stock price does not guarantee performance, and you still need to do your homework. Lower-priced stocks are often in the small-cap category, which can mean that the opportunity for higher returns is accompanied by higher risk and more volatility compared to bigger companies.
The bottom line on cheap stocks — like the five highlighted below — is that investors can see exceptional total returns from relatively modest price increases, but they fall into a riskier category that isn’t suitable for very conservative investors. With the right approach, however, these stocks and other low-priced names can be a very rewarding part of a diversified portfolio:
| Stock | Market Capitalization | Year-to-date Performance as of Aug. 22 |
| Standard Lithium Ltd. (ticker: SLI) | $586 million | 94.5% |
| E.W. Scripps Co. (SSP) | $277 million | 49.8% |
| Viomi Technology Co. Ltd. (VIOT) | $253 million | 158.7% |
| Taseko Mines Ltd. (TGB) | $1 billion | 63.4% |
| Grupo Aval Acciones y Valores SA (AVAL) | $3.7 billion | 66.4% |
Standard Lithium Ltd. (SLI)
Lithium — a key component in electric vehicle (EV) batteries — is a hot commodity right now and, subsequently, SLI is a hot stock. As of Aug. 22, the company has appreciated 94.5% year to date.
With a market cap of $586 million, SLI is a growing force in near-commercial lithium development in the U.S. The company’s flagship operations are called the South West Arkansas Project and the Lanxess 1A project. These two projects are designed to help SLI to leverage the company’s high-grade lithium brine resources concentrated in the Smackover Formation that extends under Arkansas, Louisiana, Texas, Alabama, Mississippi and parts of Florida. Geological surveys estimate that there is somewhere between 25 to 100 million tons of lithium carbonate equivalent in that mineral-rich formation.
A timely partnership with the global energy leader Equinor ASA (EQNR) and a recent $225 million grant from the U.S. Department of Energy are helping push the company’s efforts — and the stock price — forward.
E.W. Scripps Co. (SSP)
Entertainment is a tough business right now. Music, news, movies, print media and TV are all facing the challenges that come with transitioning from old technologies to modern, digital formats. That’s why it’s something of a surprise to see SSP outperforming the S&P 500 index so far in 2025, logging a 49.8% rise as of Aug. 22 close.
SSP is a $277 million diversified broadcast and communication services company with a legacy presence in local and national television. The company operates 61 broadcast stations in 41 strong markets in the U.S. The crown jewel in its portfolio, however, might be the ION Network, which reaches more than 100 million households with news, entertainment and sports content.
SSP is succeeding in a difficult environment by catering to its target market — older Americans who still enjoy a traditional TV experience — and by staying focused on local news and national issues that impact the regions it serves.
Viomi Technology Co. Ltd. (VIOT)
VIOT is a $253 million American depository receipt, or ADR, that trades on the Nasdaq Exchange. The company is based in Guangzhou, China and focuses on Internet of Things, or IoT, smart home solutions.
Smart home technology is being embraced by Chinese households faster than in the U.S. Some experts believe that this phenomenon is due to a leapfrog effect common in developing nations. Basically, new homes being built in China and other developing parts of the world don’t need to transition to smart home technology, but are having it installed from the very beginning.
VOIT concentrates on integrating smart tech into everyday household appliances and other aspects of home operation. It’s been a powerful play on the large and growing Chinese middle class. The stock is up a stunning 158.7% year to date as of Aug. 22.
Right now, the company’s customer base is China’s consumer market, but if and when U.S.-China trade relations improve, they would be open to selling in the U.S.
Taseko Mines Ltd. (TGB)
Copper is a natural resource that’s vitally important to the continued growth of the global economy. TGB is a dynamic and innovative mid-tier copper producer based in Vancouver, Canada. The company has a market cap of $1 billion.
Taseko’s most productive property is the Gibraltar Mine in British Columbia. It’s Canada’s second-largest open-pit copper mine and it delivers stable production of about 35 million pounds of copper a year. The company is developing a brand new mine in Arizona, which should be a low-cost copper provider to U.S. markets.
The stock — which is up 63.4% year to date as of Aug. 22 — is supported by a healthy balance sheet and strategic partnerships with the Japanese firm Mitsui & Co. (OTC: MITSY) and the indigenous Tsilhqot’in Nation, who have legitimate mineral rights claims to important copper resources in some of its areas of operation. This is to say nothing of the political support that U.S. President Donald Trump is publicly giving to copper miners — including TGB — with domestic operations.
Grupo Aval Acciones y Valores SA (AVAL)
AVAL has turned in an impressive performance so far in 2025. This $3.7 billion ADR, which trades on the New York Stock Exchange, is a Colombian financial holding company that offers a comprehensive range of banking, brokerage and financial services across Central America.
The firm’s strongest subsidiaries are Banco de Bogotá and Banco Popular. They offer deposit services, personal loans, home mortgages, and wealth management services to the rising middle and upper-income classes in Colombia and other parts of Latin and Central America.
In addition to traditional banking services, AVAL provides investment banking and brokerage products to institutions and wealthy individuals. Investors who understand the risks associated with emerging markets should consider adding this low-priced stock to their portfolios. Caution, however, is warranted due to the fact that the company has already appreciated 66.4% year to date as of Aug. 22. That said, it may have much more growth potential left in it over the long run.
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5 Best Cheap Stocks Under $5 to Buy Right Now originally appeared on usnews.com
Update 08/25/25: This story was previously published at an earlier date and has been updated with new information.
