One of the most important concepts in investing is that time in the market is generally superior to attempts at timing the market. Therefore, if you’re thinking about comfortably living out your golden years, you should plan ahead with cheap retirement stocks to buy now.
While the concept of ultra-long-term investments carries a staid reputation, you don’t always have to acquire shares that everybody else is bidding up, thereby absorbing a hefty premium. Instead, more than a few cheap retirement stocks to buy now exist. They’re really just waiting for astute buyers willing to travel away from the beaten path.
Moreover, the most compelling cheap retirement stocks to buy now don’t just focus on consumer staples or other boring sectors. Instead, the ideas below range from engineering solutions to technology to energy and even big tobacco for good measure.
So, if you’re ready to get your senior discount early, here are the cheap retirement stocks to buy now for your golden years.
Cheap Retirement Stocks: Cummins (CMI)
Chances are, if you notice something that moves, it could be catalyzed by Cummins (NYSE:CMI). A leader in the power and mobility space, Cummins is an industrial stalwart, manufacturing combustion engines, generators and power systems and even new power solutions such as zero-emissions hydrogen fuel cells. In addition, Cummins manufactures components for its core business units, such as filtration products and turbochargers.
At first glance, some investors might question the future relevance of the industrial titan given the broader transition to electric vehicles. While it’s difficult to predict the future with absolute authority, the soaring price tag of new EVs in 2022 – nearly $63,000 according to Kelley Blue Book – presents economic challenges that combustion-powered vehicles don’t face nearly to the same magnitude.
Further, combustion will likely continue to be the underlying power source for other modes of transportation. Currently, Cummins features a forward price-earnings ratio of 12.8 times, which is favorable compared to the industrials’ median forward P/E of 17.8 times.
Emerson Electric (EMR)
A company that’s easy to take for granted, Emerson Electric (NYSE:EMR) provides engineering services for industrial, commercial and consumer markets. On the residential front, Emerson provides systems such as air conditioning controls – something that has gained relevance with recent global heat waves.
On the automation front, Emerson offers various software applications, systems and infrastructure-related components. Further, the company delivers these and other solutions to multiple industries, including automotive, mining, renewable fuels and life sciences, just to name a few.
Still, despite the wide-ranging relevance, EMR is a cheap retirement stock to buy now. For one thing, shares are priced at a relative discount, down about 6% on a year-to-date basis.
Fundamentally, Emerson enjoys strong profitability metrics, including a 15.2% net margin that ranks much higher than the industry median of 5.5%.
Cheap Retirement Stocks: British American Tobacco (BTI)
Under the current political and social landscape, you’re not going to find too many companies more controversial than British American Tobacco (NYSE:BTI). With myriad public advocacy groups warning about the dangers of cigarette smoking for decades, BTI might appear toxic. Nevertheless, under the specific context of cheap retirement stocks to buy now, you might want to take a look here.
True, smoking rates have gone down over the past several years. At the same time, British American Tobacco has embraced the e-cigarette and vaping scene. Further, in September 2021, the company announced that its Vuse brand became the No. 1 global vaping brand by value share.
Vuse products are generally much more portable and concealable than bulky, full-sized vaping devices. As well, the technology undergirding Vuse delivers tight hits that more closely mimic the analog cigarette smoking experience.
As for being one of the cheap retirement stocks to buy now, BTI features a forward P/E ratio of 8.9x, which presently ranks better than 73% of tobacco firms.
A metals and mining firm, the Brazil-based Vale (NYSE:VALE) presents an intriguing profile among cheap retirement stocks to buy now. On a year-to-date basis, shares are just a few basis points off parity, which is far better than the S&P 500. However, on a trailing-year basis, VALE is down almost 35%, far worse than the index’s loss of 5% during the same period.
Still, long-term investors should keep close tabs on Vale because of its underlying relevance. The company is best known for being the largest producer of iron ore and nickel in the world. Of course, the latter commodity delivers enormous implications for advanced technologies. Per a CNBC report earlier this year, nickel represents a critical component of lithium-ion batteries. In turn, these batteries undergird EVs.
Intriguingly, Gurufocus.com regards VALE as modestly undervalued against its basket of valuation tools. What really stands out for Vale is that the company ranks strongly both in terms of growth and profitability. Therefore, if you’re looking for cheap retirement stocks to buy with the biggest bang for your buck, VALE has a very compelling case.
Cheap Retirement Stocks: Skyworks Solutions (SWKS)
Here’s an obvious statement for any investor in the modern world: Life runs on semiconductors. It’s the main reason why the Covid-19-fueled supply chain disruption imposed so much devastation globally.
Semiconductor security is national security, which is the overall argument for Skyworks Solutions (NASDAQ:SWKS). Developing computer chips geared for the internet of things, Skyworks is essentially at the forefront of connectivity. From data centers to automotive tech to healthcare infrastructure to aerospace and defense, several key applications run on Skyworks’ semiconductor products.
That’s the big-picture argument supporting SWKS’ inclusion among cheap retirement stocks to buy now. Fiscally, Gurufocus.com considers Skyworks to be significantly undervalued. Indeed, the company is an all-around solid long-term bet, featuring a robust balance sheet and excellent growth and profitability metrics.
Based on the evidence, you probably can’t go wrong with SWKS so long as you’re willing to ride out the present market volatility (the stock is down 29% YTD).
One of the biggest Covid-19 winners is pharmaceutical giant Pfizer (NYSE:PFE), which contributed significantly to delivering the first messenger-RNA-based vaccine to market.
Of course, with Covid-19 now largely in the rearview mirror, some folks probably don’t care too much about Pfizer. However, as the monkeypox outbreak has proven, contagious diseases may be part of our extended new normal. Given the viability of mRNA-based solutions, Pfizer could conceivably play significant roles in future disease mitigation protocols.
Naturally, that would be the longer-term narrative supporting PFE’s inclusion as one of the cheap retirement stocks to buy now. Fiscally, PFE represents another significantly undervalued investment. Like Skyworks above, Pfizer commands multiple strengths in its books, growth trajectory and profitability ranking against its peers.
Cheap Retirement Stocks: Garmin (GRMN)
Last but not least on this list of cheap retirement stocks to buy is Garmin (NYSE:GRMN). A Swiss technology firm, most consumers associate Garmin with its GPS navigation products.
While Garmin requires some forward-looking assumptions, I believe the company’s core products will soon enjoy a relevance resurgence. First, its GPS products should enjoy a demand uptick as people return to the office.
Second, the fitness tracker component should likewise swing higher because of pandemic-related dynamics. Essentially, the sedentary Covid-19 lifestyle sparked unwanted weight gain. People will need to work that weight off and fitness trackers could potentially help.
Finally, Gurufocus.com rates GRMN as modestly undervalued. Garmin features excellent strengths in its balance sheet and income statement.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.