The 7 Best Stocks Under $20 to Buy in June 2024

May inflation figures showed that consumer and producer prices fell. However, in 2024 it is important to define the meaning of words. In this case, “cooling down” does not mean prices falling. On the contrary, the rate at which they rise is decreasing. This statement has some analysts believing that stocks could be poised for a summer rally. If so, why not get more bang for your buck with the best stocks under $20 you can buy?

An important thing to remember about investor psychology is that experienced investors take a long-term view. That doesn’t mean everyone is a Warren Buffett. Instead, they look beyond today’s headlines and make educated guesses about what those headlines will mean for stocks six to 12 months later – or beyond.

Right now, this means that inflation is at a point where, in the worst-case scenario, interest rates remain at their levels. But as long as they know the next step is lower, shares can be a good buy. Here are seven of the best stocks under $20 to buy.

Digital Bridge (DBRG)

Real estate investment trust (REIT) on a black notebook on a desk.

Source: Shutterstock

A common feature of the companies on this list of the best stocks under $20 to buy is a price-to-earnings (P/E) ratio below S&P500 on average about 25x. But for me I’ll make an exception DigitalBridge (NYSE:DBRG), which trades at around 40x forward earnings.

The reason is that this real estate investment trust (REIT) specializes in data centers. According to research firm Dell’Oro Group, data center physical infrastructure revenues will grow 16% year-on-year (YOY) through 2023. And the group notes that much of this growth comes from filling backlogs caused by the pandemic. not yet of generative AI.

DigitalBridge plans to build five times as many data centers as it has built in the past three decades to meet this explosive demand. It is important to note that the company already has the third largest independent global data center footprint.

Why is the DBRG down 25% in 2024? This was reflected in the company’s March earnings report, which showed net losses rising and executive pay high. This is a matter of scale, but if the company can pull it off, the Fee-Earning Equity Under Management (FEUM) business model makes the company and its shares very attractive.

Nintendo (NTDOY)

Source: Nintendo

I was reminded Nintendo (OTCMKTS:NTDOY) when I put together a list of the best stocks under $20 to buy in May. The recent buzz around GameStop (NYSE:GME) forces me to keep it on this list.

I’m aware that many investors who own GME stocks with diamond hands don’t want to hear about the fundamentals. But it must be said that GameStop is analog in a digital world.

A better speculative investment is Nintendo. The company has delayed the launch of the next version of its popular Switch console until 2025. That’s why NTDOY stock has been under pressure lately.

That could be a disappointment for gamers who hope to have a new device before the holidays. However, the company still expects sales of over 15.5 million units by 2024. Nevertheless, with the current version being seven years old, this is an opportunity for investors to buy shares ahead of the renewal cycle.

The consensus price of the twenty analysts who issued a price target for Nintendo stock is $58.43. That’s a gain of 340.63% compared to the share’s closing price on June 13.

Kinder Morgan (KMI)

Kinder Morgan logo on a sign outside the company's headquarters in Houston.

Source: JHVEPhoto / Shutterstock.com

Yet another stock I’m including from my May list is Kinder Morgan (NYSE:RMI). At the risk of sounding like a broken bell, the bullish thesis remains the possibility of rising oil prices. OPEC+ promises to continue production cuts. Meanwhile, in the United States, the Biden administration is drawing oil from the Strategic Petroleum Reserve (SPR) it has only recently begun to replenish.

None of these issues have anything to do with stable consumer demand, which is likely to persist due to the lack of electric vehicle (EV) infrastructure on a national scale. And there’s also the increase in demand that will result if the Federal Reserve cuts interest rates.

All this oil needs to move across the country, which means it will likely flow through the company’s 80,000 miles of pipelines and about 180 terminals in the United States and Canada.

And while you wait for the oil market to recover, taking a long position in KMI stock allows you to collect the company’s high-yield dividend (5.82%), which currently pays $1.15 per share per year.

Kenvue (KVUE)

Kenvue (KVUE) logo displayed on smartphone with company website in the background

Source: shutterstock.com/T. Schneider

Kenvue (NYSE:KVUE) is the company founded when Johnson & Johnson (NYSE:J.N.J) has spun off its consumer products division. The company is now home to many of JNJ’s iconic brands, including the baby powder that was the subject of a long-running lawsuit.

While Kenvue’s indemnity agreement, which was insured by J&J as part of the spinoff, protects the company from talc liabilities arising in North America, it is not legally completely out of the question. Still, it does mean that recent settlement orders won’t impact Kenvue’s bottom line.

The main reason why KVUE stock is down 28% in the twelve months since the spinoff is missing the top line in the last two earnings reports. There is evidence that consumers, especially low- to middle-income consumers, are switching to private label stores.

However, about two-thirds of these consumers do this to compensate for inflation. As long as that is the case, this could be a headwind that will resolve itself. Analysts seem to believe that, offering a consensus price target of $22.38 for KVUE stock. And while you wait, you can collect a dividend with a 4.44% yield.

Barrick gold (GOLD)

An image of multiple gold bars.  Gold prices

Source: Shutterstock

The last of the stocks I had on a list of the best stocks under $20 to buy in May is Barrick Gold (NYSE:GOLD). My position remains the same. Inflation is cooling, but disinflation is not deflation, which is why the bull market in gold should continue.

To date, mining stocks like Barrick Gold have not participated in the gold wave. That’s largely because gold mining companies, like oil drillers, need to ramp up operations to meet production targets.

Barrick promises to increase production by 30% by 2030. To do that, it must be confident that the underlying metal, in this case gold, will remain at high levels. And you can’t forget copper, which will be needed for the electrification economy being built around the world.

GOLD stock has remained within a range over the past year and is down a total of 6% since the market close on June 13. But analysts see GOLD stock rising up to 36% with a consensus price target of $21.91.

Cleveland Cliffs (CLF)

Cleveland Cliffs (CLF) logo on an iPhone

Source: IgorGolovniov / Shutterstock.com

The Biden administration has announced it will protect the U.S. steel industry by maintaining and increasing tariffs on steel and aluminum implemented by the Trump administration. That will be bullish for domestic steelmakers such as Cleveland Cliffs (NYSE:CLF).

CLF stock is down about 27% in 2024. A lot of that has to do with the noise surrounding the company. An offer to purchase was made American steel (NYSE:X) that was rejected. It missed the top line when it reported first-quarter revenue. And the company still has an acquisition itch, which it may have done for now by buying up its U.S. factories NLMKRussia’s largest steel producer.

Steel prices have increased as inflation has increased. With demand expected to rise due to infrastructure needs, the short-term outlook for CLF stock is strong. The stock trades at around 18x forward earnings and is not overvalued compared to the broader market.

Joby Aviation (JOBY)

Smartphone with logo of the American eVTOL company Joby Aviation on the screen for the business website.  Focus on the center left of the phone display.  Unaltered photo.

Source: T. Schneider / Shutterstock.com

For purely speculative investors, this could be one of the best stocks under $20 to buy Joby Aviation (NYSE:JOBY). The company recently reached a major milestone when the Federal Aviation Administration (FAA) issued its final airworthiness criteria for Joby.

It is not an approval, but it provides clarity about what Joby must do to get that approval. It also gives Joby an edge over the competition in the United States. Moreover, the company has already signed deals that could see it begin commercial operations in the UAE as early as 2025.

And from an investment perspective, investors should be encouraged by the $900 million in cash on Joby’s balance sheet. That pretty much ensures it can get into production without diluting shareholder value.

JOBY stock is down 36% in the last twelve months and down 24% in 2024 alone. At a price of $5 per share on June 13, the stock is still a penny stock. It doesn’t look like this will remain the case for long. There’s time to gradually scale up to JOBY stock, but it’s one you may need to act on sooner rather than later before the biggest gains fly away.

As of the date of publication, Chris Markoch had no positions (directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to the InvestorPlace.com Publishing Guidelines.

Chris Markoch is a freelance financial copywriter who has been covering the market for more than five years. He has been writing for InvestorPlace since 2019.