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.
What Are the Best Cheap Stocks?
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 NOV. 24 |
| Bitfarms Ltd. (ticker: BITF) | $1.6 billion | 87.3% |
| Douglas Elliman Inc. (DOUG) | $222 million | 44.3% |
| Metalpha Technology Holding Ltd. (MATH) | $114 million | 151.3% |
| Grab Holdings Ltd. (GRAB) | $21.3 million | 11.2% |
| Oncology Institute Inc. (TOI) | $285 million | 883.8% |
Bitfarms Ltd. (BITF)
If you like playing big-picture tech trends, Bitfarms offers a pure-play entry into the next wave of North American digital infrastructure. This company is executing a strategic pivot from pure Bitcoin mining toward high-performance computing (HPC) and AI infrastructure hosting. In plain English, this means it’s transforming from a highly volatile commodity miner into a potential high-margin data center operator, riding the massive, long-term growth curve of artificial intelligence (AI) demand.
What makes this stock compelling is the aggressive execution and financing behind this shift. Bitfarms recently secured $814 million in liquidity (as of November), largely through a successful $588 million convertible notes offering. This massive war chest is being used to fund AI infrastructure buildouts, starting with the conversion of its site in Washington state to support advanced liquid-cooling for Nvidia GB300 GPUs, targeting completion by December 2026. This operational focus is already translating into cash profitability, with adjusted EBITDA soaring to $20 million from $2 million and a 156% year-over-year revenue surge in the third quarter.
The big cautionary note here is execution risk and profitability: The company’s net loss widened to $46 million in Q3 2025. Success hinges on management’s ability to swiftly and efficiently convert its sites, secure long-term, high-margin hosting contracts, and deliver on its promise that HPC/AI can generate more net operating income than its legacy Bitcoin mining business.
Douglas Elliman Inc. (DOUG)
Real estate investors may rejoice: Here is one of the cheapest ways to invest in the sector. Douglas Elliman is a highly leveraged play on the luxury housing market in the U.S. It operates primarily in high-margin markets like New York, Florida and California, and its business thrives on large transaction volumes.
Despite a challenging few years due to high interest rates, the company has made strategic moves to position itself for the next boom: It recently announced international expansion into France and Monaco and launched new AI-driven technology tools for its agents.
The clear risk is that the stock is highly sensitive to external economic factors, especially interest rates. Its success hinges entirely on transaction volumes and high-net-worth buyers returning to the market.
[Read: 6 Best Cheap Dividend Stocks to Buy Under $10]
Metalpha Technology Holding Ltd. (MATH)
If you’re looking to add another cryptocurrency angle to your portfolio and have an iron stomach, Metalpha Technology Holding offers a rare combination in the penny stock universe: a high-risk digital asset play that has shown recent fundamental strength. As a Hong Kong-based firm specializing in proprietary blockchain and trading products, its revenue has seen exceptional growth in recent years, including doubling in 2025.
Crucially, the company has shown signs of improving its financial foundation. Recent corporate news highlights a significant $12 million strategic investment from two institutional groups and expansion into the Middle East market via a joint venture.
The primary caution, however, remains severe: The company’s revenue is tied directly to the highly volatile and speculative digital asset market. The stock is known to be volatile, and the company has previously faced issues with meeting Nasdaq compliance requirements.
Grab Holdings Ltd. (GRAB)
Often called the “super app” of Southeast Asia, Grab has become the single essential mobile utility for over 47 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 posted a $17 million net profit for third quarter 2025, and raised its full-year revenue and adjusted EBITDA guidance again. This demonstrates not only that its monetization efforts are working but that management is becoming increasingly confident in its financial discipline.
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. Just be aware that competition and regulatory pressures may mount. While Grab is the dominant player in its market currently, it’s constantly fending off local and regional rivals.
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 $285 million value-based cancer-care group in the U.S. Though it’s had a rough go in the past month or so, its shares have surged nearly 884% so far in 2025. Four Wall Street analysts covered by TipRanks all rate TOI a “buy” now, with an average price target that represents 125% upside potential.
TOI’s year-to-date gain is due in part to a notable increase in revenue and profit, but the company is still operating at a net loss. It’s also expected to join the Russell 2000 and Russell 3000 indexes next year. Finally, over 30% 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 over 2 million shares per day, on average, making it a liquid option for investors. However, perspective is crucial here. Despite positive signs, the stock can be highly volatile and it’s important to be prepared for the risks associated with health care policy changes.
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5 Best Cheap Stocks Under $5 to Buy Right Now originally appeared on usnews.com
Update 11/25/25: This story was published at an earlier date and has been updated with new information.
