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.
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 the stock market tends 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.
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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 future revenue and earnings, as well as its relative position in its sector, should be thoroughly reviewed before you click the “buy” button.
The best cheap stocks belong to companies that are fundamentally strong but experiencing a brief, temporary setback, says Steven Conners, founder and president of Conners Wealth Management in Scottsdale, Arizona. What you want to avoid are cheap stocks that don’t have a “catalyst to improve their valuation.”
He also points out that price is not the best metric for determining if a stock is “cheap.” Rather, you should look at its price-to-earnings (P/E) ratio. This tells you how many investment dollars you are paying for each dollar of company earnings.
Unfortunately, many low-priced stocks don’t have available P/E ratios, as their earnings are negative. In these cases, price-to-sales (P/S), which measures how much investors are paying per dollar of revenue, can be a useful alternative. The P/S ratio can also sometimes be a better metric, since it’s harder for companies to manipulate sales numbers compared to profit. In either case, lower is better, with a P/E under 20 and a P/S under 2 often seen as ideal by value investors, but these ranges can vary from industry to industry.
The bottom line on low-priced 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 conservative investors. With the right approach, however, these cheap stocks can be a rewarding part of a diversified portfolio:
| Stock | Market capitalization | Year-to-date return as of Oct. 13 |
| Esperion Therapeutics Inc (ticker: ESPR) | $610 million | 23.6% |
| Banco Bradesco SA (BBD) | $31 billion | 74.6% |
| GoPro Inc. (GPRO) | $329 million | 90% |
| Grab Holdings Ltd. (GRAB) | $24 billion | 25.6% |
| Oncology Institute Inc. (TOI) | $372 million | 1,217% |
Esperion Therapeutics Inc. (ESPR)
If you’re a fan of underdogs with turnaround potential and can tolerate a hefty dose of risk, Esperion Therapeutics is a biotech stock
that warrants a closer look, especially now that it’s trading in the low single digits.
Esperion isn’t just a flier; it’s a company with two FDA-approved, cholesterol-lowering drugs — Nexletol and Nexlizet — that directly address a massive market: patients who can’t tolerate statins or need additional help controlling their LDL (“bad”) cholesterol.
The real game-changer for this stock came with the release of the Clear Outcomes trial data in 2023. This large, long-term study conclusively showed that Esperion’s lead drug, when added to a statin, significantly reduces the risk of major adverse cardiovascular events, including heart attack and stroke. This is the gold standard for drug efficacy and transforms the perception of the drug from merely “cholesterol-lowering” to “life-saving.” Further supportive data highlighted in November 2024 showed the drug also reduced major adverse limb events in over one-third of patients.
Investing in ESPR requires patience, as bringing drugs to market takes time. However, for investors with a stomach for volatility, these promising trials and rapidly growing revenue — although the company still reported a $51 million net loss in 2024 — present a compelling buying proposition.
Banco Bradesco SA (BBD)
If you want to add a bit of international flair to your portfolio while staying under the $5 mark, Banco Bradesco is an interesting proposition. As one of Brazil’s largest banking institutions, it offers a unique combination of stability, profitability and an attractive valuation that screams “contrarian opportunity.”
Bradesco isn’t a speculative play; it’s a bedrock financial institution in a major emerging market. The bank boasts a massive retail branch network, a significant insurance arm and a history of robust profitability. You could call it a blue chip of the Brazilian financial sector.
The stock has been heavily discounted due to macroeconomic headwinds in Brazil, such as high interest rates and slow economic growth, and concerns over its asset quality. However, this has resulted in a valuation that is incredibly cheap by historical standards and relative to U.S. banks.
GoPro Inc. (GPRO)
GoPro probably needs no introduction. The $329 million tech company is the producer of mountable and wearable cameras, drones and camera accessories. It’s become so popular that it even has a small line of branded apparel fans can buy.
And there are many fans: The company has more than 53 million social media followers, and has sold more than 52 million cameras since its inception in 2004. GoPro has also introduced a subscription service, which saw a 27% compound annual growth rate between 2021 and the first quarter of 2025.
GPRO stock has gained 90% year to date in 2025, with a healthy trading volume of more than 14 million shares a day, on average.
[Read: 2025’s 10 Best-Performing Stocks]
Grab Holdings Ltd. (GRAB)
Often called the “super app” of Southeast Asia, Grab has become the single essential mobile utility for over 40 million monthly users across eight countries, combining ride-hailing, food delivery and digital financial services into one dominant platform.
The stock is trading at just over $5, but its compelling investment case makes it worthy of inclusion. The company isn’t just a high-growth startup anymore; it’s officially turning the corner. Grab recently achieved a major milestone by posting its first net profit in the fourth quarter of 2023, proving it can effectively monetize its massive network. This financial pivot, driven by relentless cost discipline and the growth of its high-margin financial services, has secured a “strong buy” consensus from Wall Street.
Grab enjoys an impressive market share in the region’s online mobility and delivery sectors, and its fundamental business is scaling up exponentially, with strong revenue growth year over year. If you want a cheap stock that offers exposure to the exploding digital economy of a 700 million-person region, Grab is a solid option.
Oncology Institute Inc. (TOI)
Rounding out this list is a prime example of the exponential returns that are possible in the cheap stocks arena. The Oncology Institute is a $372 million value-based cancer-care group in the U.S. Its shares have surged over 1,200% so far in 2025.
This gain is due in part to a notable increase in earnings, but the company is still operating at a net loss. Its P/S is favorable, though, at 0.75. It’s also expected to join the Russell 2000 and Russell 3000 indexes next year. Finally, over 40% of its shares are insider-owned, which is generally considered a bullish signal to investors since it suggests management has confidence in the company’s future.
The stock has a trading volume of nearly 2 million shares per day, on average, making it a liquid option for investors. Its next earnings call in November is definitely worth watching out for.
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5 Best Cheap Stocks Under $5 to Buy Right Now originally appeared on usnews.com
Update 10/14/25: This story was published at an earlier date and has been updated with new information.
