Unbelievable Bargains: 2 Ultra-Low-Cost Stocks to Buy Now
Are you ready to uncover some hidden gems in the stock market? While the FTSE 100 is soaring, there are still stocks out there that seem too good to be true. And that's exactly what we're exploring today.
I've been on the hunt for stocks with a price-to-earnings (P/E) ratio below 10, and two companies immediately caught my attention. But before we dive in, let's address the elephant in the room: Is it too good to be true?
NatWest: A Bank's Surprising Value
Imagine my surprise when I discovered that NatWest Group (LSE: NWG) fits the bill! This banking giant has been on a tear, with its share price skyrocketing 212% over five years. But here's where it gets interesting: the stock price took a 7.3% dip in February, even as the FTSE 100 climbed 7.5%.
Despite this recent blip, NatWest's 12-month performance is impressive, with a 30% rise. But the real eye-opener is its P/E ratio of just 9.1, which seems incredibly low given its stellar performance.
The icing on the cake? NatWest's full-year profits jumped a whopping 24.4% to £7.7bn in February, surpassing expectations. They also announced a £750m share buyback for 2026 and raised their performance targets.
But here's where it gets controversial: Investors were seemingly unimpressed, perhaps due to Jamie Dimon's warning at JPMorgan Chase about potential risks from the AI revolution. This raises the question: Are investors being overly cautious, or is there a hidden risk lurking beneath the surface?
While there are always risks, especially after such a strong run, NatWest's recent dip has made it even more attractive. The trailing dividend yield has climbed back up to 5.25%, making it a compelling option. And if Middle East tensions cause market jitters next week, NatWest could become even more appealing.
International Airlines Group: Flying High, But Is It Sustainable?
Another stock that caught my eye is International Consolidated Airlines Group (LSE: IAG), the owner of British Airways. Its shares have soared 25% in one year and an astonishing 170% in three years.
However, on Friday, the stock took a nosedive of 7.35%, despite the company reporting a 'record' performance for 2025. Operating profit and revenue were up, and the board increased the dividend and announced a €1.5bn share buyback.
So, why the sudden drop? Investors seemed to focus on potential headwinds, including a slowdown in cargo and passenger revenues, economic uncertainty, and the role of lower fuel prices in the company's growth. Some profit-taking after a remarkable run may also have contributed.
Today, IAG's P/E ratio of 7.2 makes it an attractive prospect. But it's been undervalued for years, which could indicate that investors perceive airlines as risky investments due to their vulnerability to wars, natural disasters, strikes, oil price fluctuations, and recessions.
And this is the part most people miss: Next week's conflict in Iran could be a double-edged sword. While it may drive up oil prices and disrupt flights, it could also present a buying opportunity for those with a long-term perspective.
With other FTSE 100 stocks like JD Sports Fashion and easyJet also looking incredibly cheap, the market could offer even more value if Iran-related concerns affect share prices next week.
So, are these stocks too good to be true, or hidden treasures waiting to be discovered? Share your thoughts in the comments below, and let's discuss!
