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4 Must-Buy Under $20 Stocks as Fed Turns Hawkish Again
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At an International Monetary Fund event on Thursday, Nov 9, Fed Chair Jerome Powell and other key officials from the central bank reverted to a hawkish stance on the future of the current interest rate-hike regime. Powell said that he is still not sure that interest rates are high enough to finish the battle with inflation while cautioning that the Fed may get little further help in taming price hikes from improvements in the supply of goods, services and labor.
This is quite a departure from the recent sentiment seen in investors that the central bank would be dovish going forward, or else it would run the risk of landing the economy into a recession. These recent comments indicate that the Fed officials still believe that further rate hikes are in the cards.
Warren Buffett once said, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” True to form, investors have always looked to buy shares at a low price and sell them high, which is the very definition of making money on the stock market.
With the current state of volatility set to continue in the markets, we are in a “good news is bad news” zone yet again. Any show of resilience from the various sectors is likely to bring share prices down and can open up entry points for investors. Investing in cheaper but potential blockbuster stocks for tomorrow might be the order of the day.
Stocks that do not promise much today may get a bump in share price tomorrow. Alternately, some promising stocks do not win over the stock market in the long run. Therefore, the decision on which cheap stock to opt for becomes a significant one.
In 2023, the market rebounded from the vagaries of 2022, primarily based on a tech rally. For first-time investors or those who want an entry point into the market without putting a lot at stake, the time feels right.
Our Choices
We have selected four stocks below the $20 price point for this purpose. These stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum. The score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
American Eagle Outfitters, Inc. (AEO - Free Report) is a specialty retailer that provides clothing, accessories and personal care products. It is currently priced at $18.41 per share.
AEO’s expected earnings growth rate for the current year is 36.1%. The Zacks Consensus Estimate for its current-year earnings has improved by 7.3% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
OneSpaWorld Holdings Limited (OSW - Free Report) is an operator of health and wellness centers onboard cruise ships and at destination resorts. It is currently priced at $11.00 per share.
OSW’s expected earnings growth rate for the current year is 132.1%. The Zacks Consensus Estimate for its current-year earnings has improved by 6.6% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Gap, Inc. (GPS - Free Report) is an apparel retailer. It is currently priced at $13.48 per share.
GPS’ expected earnings growth rate for the current year is 277.5%. The Zacks Consensus Estimate for its current-year earnings has improved by 1.4% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A.
Xerox Holdings Corporation (XRX - Free Report) is a workplace technology company that develops and sells document management systems. It is currently priced at $13.09 per share.
XRX’s expected earnings growth rate for the current year is 64.3%. The Zacks Consensus Estimate for its current-year earnings has improved by 8.2% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A.
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4 Must-Buy Under $20 Stocks as Fed Turns Hawkish Again
At an International Monetary Fund event on Thursday, Nov 9, Fed Chair Jerome Powell and other key officials from the central bank reverted to a hawkish stance on the future of the current interest rate-hike regime. Powell said that he is still not sure that interest rates are high enough to finish the battle with inflation while cautioning that the Fed may get little further help in taming price hikes from improvements in the supply of goods, services and labor.
This is quite a departure from the recent sentiment seen in investors that the central bank would be dovish going forward, or else it would run the risk of landing the economy into a recession. These recent comments indicate that the Fed officials still believe that further rate hikes are in the cards.
Warren Buffett once said, “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” True to form, investors have always looked to buy shares at a low price and sell them high, which is the very definition of making money on the stock market.
With the current state of volatility set to continue in the markets, we are in a “good news is bad news” zone yet again. Any show of resilience from the various sectors is likely to bring share prices down and can open up entry points for investors. Investing in cheaper but potential blockbuster stocks for tomorrow might be the order of the day.
Stocks that do not promise much today may get a bump in share price tomorrow. Alternately, some promising stocks do not win over the stock market in the long run. Therefore, the decision on which cheap stock to opt for becomes a significant one.
In 2023, the market rebounded from the vagaries of 2022, primarily based on a tech rally. For first-time investors or those who want an entry point into the market without putting a lot at stake, the time feels right.
Our Choices
We have selected four stocks below the $20 price point for this purpose. These stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum. The score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
American Eagle Outfitters, Inc. (AEO - Free Report) is a specialty retailer that provides clothing, accessories and personal care products. It is currently priced at $18.41 per share.
AEO’s expected earnings growth rate for the current year is 36.1%. The Zacks Consensus Estimate for its current-year earnings has improved by 7.3% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
OneSpaWorld Holdings Limited (OSW - Free Report) is an operator of health and wellness centers onboard cruise ships and at destination resorts. It is currently priced at $11.00 per share.
OSW’s expected earnings growth rate for the current year is 132.1%. The Zacks Consensus Estimate for its current-year earnings has improved by 6.6% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Gap, Inc. (GPS - Free Report) is an apparel retailer. It is currently priced at $13.48 per share.
GPS’ expected earnings growth rate for the current year is 277.5%. The Zacks Consensus Estimate for its current-year earnings has improved by 1.4% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A.
Xerox Holdings Corporation (XRX - Free Report) is a workplace technology company that develops and sells document management systems. It is currently priced at $13.09 per share.
XRX’s expected earnings growth rate for the current year is 64.3%. The Zacks Consensus Estimate for its current-year earnings has improved by 8.2% over the past 60 days. The company has a Zacks Rank #2 and a VGM Score of A.