If you’re looking to build out your portfolio with individual stocks, finding strong investment opportunities is key.
Each month, we compile the top 10 best stocks to buy now. These are the best-performing S&P 500-listed stocks so far in 2024 that have analyst consensus ratings of Buy or better.
They’re solid, they’re growing. And a majority of financial analysts covering these particular stocks believe they’re a good investment and recommend purchasing them.
But remember, investing in the stock market involves risks. It’s important to do your own research or consult with a financial advisor before making investment decisions.
Source: Finviz. Data is current as of August 6, 2024.
Methodology: How we choose the best stocks to buy now
Finder’s investments experts analyze all S&P 500-listed stocks to curate a list of the best stocks to buy now. Ordered by year-to-date performance, we consider only companies listed on the S&P 500 that meet the following criteria:
Analyst recommendation: Buy or better
Earnings-per-share growth past 5 years: Positive (greater than 0%)
Earnings-per-share growth this year: Positive (greater than 0%)
Earnings-per-share growth next year: Positive (greater than 0%)
Sales growth past 5 years: Positive (greater than 0%)
Net profit margin: Positive (greater than 0%)
Current ratio: Greater than 1
Debt-to-equity ratio: Less than 1
Analyst recommendation. This is the consensus outlook of analysts regarding whether to buy, sell or hold a particular stock based on their assessment of its futures performance and valuation, where 1.0 means “Strong Buy,” 2.0 means “Buy,” 3.0 means “Hold,” 4.0 means “Sell,” and 5.0 means “Strong Sell.”
Earnings-per-share growth past 5 years. Earnings-per-share (EPS) is a financial metric that represents the portion of a company’s profit allocated to each outstanding share of common stock.(1) EPS growth measures the percentage increase or decrease in a company’s EPS over a defined period, with a positive EPS growth rate showing that a company is increasing its profitability and effectively managing its operations. (2) EPS growth over the past five years gives a long-term view of this performance.
Earnings-per-share growth this year. This shows a company’s recent profitability improvement and effective management of current operations.
Earnings-per-share growth next year. This indicates analyst’s expectations of a company’s future profitability and operational performance.(3)
Sales growth past 5 years. This indicates that a company has been consistently increasing its revenue, reflecting strong demand for its products or services.(4)
Net profit margin. This measures the percentage of revenue that remains as profit after all expenses are deducted, indicating a company’s overall profitability and efficiency.(5) A high net profit margin indicates that a company is generating a significant profit relative to its revenue after accounting for all expenses, which can signify strong efficiency and profitability in its operations. A 20% net profit margin is considered good. (6)
Current ratio. This metric measures a company’s ability to pay its short-term liabilities with its short-term assets, indicating its liquidity and financial health. A higher current ratio suggests a strong liquidity position, while a lower ratio may signal potential difficulties in meeting short-term debt obligations. A rate greater than 1 implies the company is likely in a strong financial position to meet its immediate obligations.(7)
Debt-to-equity ratio. This metric is used to measure a company’s leverage by comparing its total liabilities to shareholder’s equity.(8) A ratio lower than 1 is often considered favorable as it suggests that a company is relying less on debt to finance its operations and growth.(9)
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How to find the best stocks to buy now
You effectively want to find the stocks that have been mis-priced, before the market realizes that it’s mis-priced. There are a few ways to get an idea of which stocks are undervalued, which ones are overvalued and which ones are just right. Here are some of the strategies:
Strategy 1: Keep an eye on the trends
You’re in a good position to find the best stocks to buy if you’ve got a good idea of which stocks are trending, what some of the experts are saying and which sectors are doing well (or not doing well). As well as Finder, there are some good financial news sites such as Bloomberg and the Financial Times. These can help you stay on top of the latest trends and expert views.
Social media and forums, like Reddit and X (formerlyTwitter) have been a good source of financial insight — but you should ensure that you trust the accounts you’re following. Look out for people with knowledge and experience in the subject.
Strategy 2: Look at the news
Once you know which stocks are trending, find out why. There’s almost always a reason behind why people are talking about a specific stock — sometimes it’s really obvious, for example every time Apple releases a new product, something happens to its stock price. Other times, the answer might take a little digging.
Looking at news sites can be really helpful here. You can set news alerts or actively search for company names to find out what’s going on. Many stock trading apps offer stock watchlists and price alerts to help you find the stocks you want.
Traders who keep an eye on the news might be classed as “momentum investors” – people who like to capitalize on the continuance of a trend.
Strategy 3: Look into analysis
There are a couple of different types of analysis available for you to try, and in some cases, someone else can do it for you.
Both technical and fundamental analysts are hoping to find a stock which is underpriced by the wider market. If they’re confident in their assessment, they can find what they believe is a cheap stock to buy, and make a gain as the price rises.
But you don’t need to be a professional analyst to try it out. The GameStop frenzy in early 2021 showed that even the retail investor can give the institutional investors a run for their money. If you’re new to investing or trading and want to give it a shot – go for it. We’ve included some more detail below about the types of analysis.
Remember the golden rules: don’t invest more than you can afford to lose, and remember that your investments can go down as well as up.
Individual stock picking can offer higher potential returns and greater control over investment choices, but it’s risky because it can lead to significant losses if those stocks underperform due to market volatility, company-specific issues or broader economic factors.
For these reasons, exchange-traded funds (ETFs) are generally better for beginners than individual stocks. ETFs offer diversified exposure to a broad range of assets, reducing risk and simplifying the investment process. Specifically, low-cost index funds give you exposure to all the stocks within a specific market indexes, such as the S&P 500, the Dow Jones Industrial Average or the total stock market index. This diversifies your risk because the decline of one stock may be offset by the outperformance of another.
That said, blue chip stocks and dividend stocks are often considered good choices for beginners because they tend to be more stable, have established tracked records of performance and provide consistent income through dividends.
Remember, there are absolutely no guarantees with any stock or investing strategy. So make sure you research each stock, regardless of how established the company is.
What Matt thinks about the best stocks to buy for beginners
Beginners may benefit the most by investing in a handful of stocks of companies they know and whose products they are familiar with. That said, beginners may want to build the core of their portfolio with broad market index funds to get the most diversification without requiring the market expertise needed for picking individual stocks.
Take a look at the 10-year historical performance of the S&P 500. The S&P 500 is a stock market index comprising 500 leading US companies, and it’s widely regarded as an essential benchmark for the US stock market.
Matt Miczulski is an investments editor at Finder. With over 450 bylines, Matt dissects and reviews brokers and investing platforms to expose perks and pain points, explores investment products and concepts and covers market news, making investing more accessible and helping readers to make informed financial decisions.
Before joining Finder in 2021, Matt covered everything from finance news and banking to debt and travel for FinanceBuzz. His expertise and analysis on investing and other financial topics has been featured on CBS, MSN, Best Company and Consolidated Credit, among others. Matt holds a BA in history from William Paterson University. See full bio
Matt's expertise
Matt has written 207 Finder guides across topics including:
Kylie Purcell is the senior investments editor at Finder. She has a background in business and finance news with previous roles at SBS, Your Money, TVNZ, Switzer Group and The Adviser magazine. Kylie has a Masters in International Journalism and a Graduate Diploma in Economics. When she's not writing about the markets you can find her bingeing on coffee.
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Finder.com is an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. While we are independent, the offers that appear on this site are from companies from which Finder receives compensation. We may receive compensation from our partners for placement of their products or services. We may also receive compensation if you click on certain links posted on our site. While compensation arrangements may affect the order, position or placement of product information, it doesn't influence our assessment of those products. Please don't interpret the order in which products appear on our Site as any endorsement or recommendation from us. Finder compares a wide range of products, providers and services but we don't provide information on all available products, providers or services. Please appreciate that there may be other options available to you than the products, providers or services covered by our service.
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