Stocks needn’t be expensive to buy. In fact, stocks often attract more investors when their share price is affordable. Companies appear to acknowledge this fact, which is why many are splitting their stocks. Chipmaker Nvidia (NASDAQ:NVDA) just split its stock on a 10-for-1 basis, taking the share price down to $120 from $1,200. Chipotle Mexican Grill (NYSE:CMG) will split its stock later in June on a 50-for-1 basis.
Right now, many stocks are trading for less than $50, putting them in reach of most investors. A lot of these stocks are of well-known blue-chip companies and are trading at fair valuations, with many of them also offering attractive dividends. Best of all, some of these affordable stocks have catalysts pushing their share prices higher. Here are the three best under $50 stocks to buy in June 2024.
General Motors (GM)
The stock of automotive giant General Motors (NYSE:GM) is currently trading just under $48 per share. The price might not be below $50 for long after the company announced a new $6 billion stock buyback program. The share repurchase comes as a $10 billion stock buyback program announced in November 2023 ends on June 30. A timeframe for completing the new share repurchases hasn’t been announced.
The Detroit automaker’s commitment to its shareholders is admirable, especially coming after the company endured a costly strike last fall when employees represented by the United Auto Workers (UAW) union staged rotating strikes that temporarily shut down production. General Motors is also grappling with uncertainty surrounding consumer demand for electric vehicles, which the automaker has invested billions of dollars in.
Despite the headaches, General Motors has managed to post strong financial results in recent quarters, putting it in a position to extend its stock buyback program. GM stock has increased 31% in the last 12 months.
UBS Group (UBS)
Shares of Swiss banking giant UBS Group (NYSE:UBS) have risen 54% in the last 12 months but still trade for a little more than $30 per share. UBS stock currently looks cheap to buy, trading at only three times price/earnings. Now might be an opportune time to buy UBS stock, with the bank scheduled to complete its merger with former rival Credit Suisse by July 1 of this year.
UBS, which acquired Credit Suisse in 2023 for $3.2 billion after the bank’s collapse, had previously said the banks’ combination would be completed by year’s end. The accelerated takeover of Credit Suisse leaves Switzerland with one global bank that has a balance sheet twice as large as the country’s economy. Going forward, UBS will be an international behemoth with nearly $6 trillion of assets under management.
In addition to being cheap, UBS stock also pays a quarterly dividend of 17.5 cents per share, giving it a yield of over 2%.
Southwest Airlines (LUV)
Shares of Southwest Airlines (NYSE:LUV) have gotten beaten down since the onset of the COVID-19 pandemic. LUV stock today is trading 42% lower than where it was five years ago. At under $30 per share, the stock should be accessible to most investors. And now might be a good time to take a position with major changes coming to the airline. Southwest stock recently jumped 8% higher on news that activist investor Elliott Investment Management has built a $1.9 billion stake in the carrier.
Privately held Elliott has become one of Southwest Airlines’ largest shareholders and is demanding big changes at the underperforming company, including the ousting of CEO Robert Jordan and an overhaul of the board. Elliott Management says major changes are needed to reverse the prolonged slump in LUV stock. Investors appear to agree. With air travel in the U.S. back at record levels, many investors say it is unacceptable that Southwest’s stock continues to underperform.
On the date of publication, Joel Baglole held a long position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
