The Best Under $50 Stocks To Buy Now

Stocks have always been a great source of generating wealth, particularly if you can hold quality companies for the long haul. The first half of 2022 has seen a merciless selloff in the stock market, with the S&P 500 and Nasdaq-100 indices trading down roughly 20% and 30%, respectively.

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In the midst of all of this pain, however, there is likely opportunity. The stocks on this list all trade for under $50 per share, but each has an investment thesis supporting significant potential gains down the road. All are down by double-digit percentages year-to-date, which could offer an attractive entry point for long-term investors.

Just be aware that if the recession that some investors fear actually strikes in 2022 or 2023, there could be further pain ahead. That said, here are several under $50 stocks to consider buying.

• Price as of May 30, 2022: $35.77
• YTD % change: -61.04%

Teladoc Health has had quite a ride, going from a pandemic-era darling to a stock investors can’t sell fast enough. Teladoc is already down an astonishing 61% in 2022, but that doesn’t even tell the whole story.

From it’s 52-week high, Teladoc stock has crashed an unbelievable 79.5%, as investors believe that the company’s business model isn’t nearly as valuable in a post-pandemic world. However, while there’s no doubt that the astronomical growth the company exhibited during the heart of the pandemic has temporarily passed, the company is still growing its revenues and patient visits by double digits, and it now trades closer to 2x sales than the 24x sales it hit at its peak.

The road ahead is no doubt volatile, but long-term investors may be rewarded by an investment in what has now become a value stock.

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• Price as of May 30, 2022: $13.62
• YTD % change: -34.42%

Shares of Ford Motor had an incredible 2021, jumping 136.29%, but they have lost about one-third of their value YTD in 2022. As with Macy’s, Ford shares share an attractive combination of a low multiple of about 5x earnings with a well above-average yield of 3.05%.

Ford was maligned for decades as an old-school company that had nothing exciting to offer, and its shares are still trading at the same price they were way back in 1996. But times are turning for the venerable company, which has surged to be an industry leader in electric vehicles.

The company is essentially all-in on the coming electric vehicle revolution, investing billions of dollars in plants, equipment and research. This shift is already paying dividends, as the company’s F-150 Lightning electric truck is so popular that reservations are no longer being accepted in 2022.

• Price as of May 30, 2022: $16.20
• YTD % change: -21.89%

Norwegian Cruise Line Holdings, and indeed the entire cruising industry as a whole, has seen nothing but bad news for over two years straight now. The company had to take on massive amounts of debt to survive the pandemic, and it is only just now getting its full fleet operational.

But calm seas may be on the horizon for NCLH, whose CEO has mandated holding the line of pricing in an effort to build long-term brand value and who recently refinanced the bulk of its expensive pandemic-era debt. As the risk of serious coronavirus infection recedes and pent-up world travelers begin to jump on cruise ships again, NCLH stands to reap big rewards.

• Price as of May 30, 2022: $23.45
• YTD % change: -10.43%

Macy’s is another company that has had a tumultuous few years, but it seems as if it’s currently firing on all cylinders. In its most recent earnings report, on May 26, 2022, the company reported profits and sales ahead of analysts’ estimates. Even better, the company reaffirmed sales estimates for the year and raised its profit outlook, based primarily on expected gains in credit card revenue.

In spite of high inflation, Macy’s noted that shoppers have been spending money on clothing, luggage and luxury goods. The increasing return of international travel has also boosted sales at Macy’s locations in larger cities, such as New York. The company currently trades at an incredibly low valuation of 5x earnings, and it pays a relatively hefty 2.69% dividend.

• Price as of May 30, 2022: $34.89
• YTD % change: -22.26%

MGM Resorts is a recovery play, pure and simple. As with many in the entertainment business, MGM suffered mightily during the depths of the pandemic, but as travel patterns resume, it stands to be a big beneficiary.

In addition to generating about 50% of its revenue from Las Vegas, the company has been growing its digital business as well. It also has extensive cash reserves, which can help buffer it from temporary fluctuations in visitation and also leave it well-positioned to take advantage of any opportunities that may arise in the sector.

• Price as of May 30, 2022: $37.02
• YTD % change: -16.79%

The financial sector, and banks in particular, tend to be more defensive in an environment of rising interest rates. This is because banks can use higher current interest rates to earn more money on loans, including home mortgages, auto loans, construction financing and credit cards.

Although they may have to pay a bit more on their deposit products, like savings accounts, these rates typically lag those of loan products. Other factors working in Bank of America’s favor include its low valuation, with a price-earnings ratio of about 10.5, and its high dividend, currently sitting at 2.27%.

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