Best Stocks for Beginners with Little Money

Invest in the best stocks for beginners with little money with Robinhood as your online brokerage.

Investing can be an intimidating task for beginners, but it is available for everyone, no matter their experience or available funds.

Some of the best times to invest in stocks are at their lows.

Anyone can assemble a portfolio and start building wealth. But it is important to take that first step without feeling too overwhelmed. This article will take you through some of the best stocks to invest in.

10 Best Stocks for Beginners with Little Money

Picking stocks to invest in can be a tiresome task, especially if you just don’t have time. Therefore, a list of the top 10 stocks for beginners is provided below.

1. Ford Motor Co. (NYSE: F) 

Ford is not ignoring the shift to electric vehicles (EVs). It plans to invest $50 billion to develop EVs and recently opened its Cologne EV Center, the first carbon-neutral assembly plant for the group.

Its first-quarter results revealed revenue was up 20% year over year to $41.5 billion, as its portfolio of gas-powered, hybrid and electric vehicles continues to resonate well with consumers.

2. Dropbox Inc. (NASDAQ: DBX) 

Dropbox is a file-hosting service for individuals and businesses all around the world. It is used for cloud storage and file synchronization, and it helps people work together and share content.

The firm was recently upgraded at Goldman Sachs after its Q1 results beat consensus expectations. Goldman Sachs also cited Dropbox’s strong operational profitability as well as its discounted valuation.

The stock has surged over 17% over the last month as it wiped out losses experienced earlier in the year.

3. AT&T Inc. (NYSE: T) 

AT&T is a telecommunications, media and technology provider, but its shares have performed poorly in recent years.

Its latest decline has been from the threat of Amazon entering the telecom sector. But the growth of its 5G and fiber subscribers, which saw 424,000 postpaid phone net adds, as well as revenues of $30.1 billion in Q1, suggests the firm still has room to grow. Even without share price growth, the company pays a healthy dividend.

4. NiSource Inc. (NYSE: NI) 

NiSource serves nearly four million natural gas and electric customers across six states in the United States. Utility stocks are considered a lower risk than some other sectors because of the necessity of gas, electricity and water in everyday life.

The firm recently hiked its quarterly dividend to 25 cents per share, making it a possible candidate for investors looking for steady, stable and lower risk investments.

5. Pinterest Inc. (NYSE: PINS) 

The social media firm Pinterest has been fairly turbulent this year. Many investors have fallen out of love with tech stocks as the market environment impacts company financials.

But in Pinterest’s Q1 results, revenue jumped 5% to $603 million and the group’s monthly active users totaled 463 million, up 7% year over year. The firm recently announced its partnership with Amazon to bring more ad content to its platform as Pinterest becomes more shoppable for its users.

6. Teladoc Health Inc. (NYSE: TDOC)

Teladoc Health has been another poor performer this year. The company provides virtual care and telemedicine, and its shares rose during the pandemic. Its combination of tech and healthcare offers convenience and cost-saving practices for consumers.

The group is one of the leading telehealth firms and has seen revenue, visits and memberships trending higher. Teladoc had 84.9 million paid memberships as of Q1, although investors have kept a close eye on the bottom line after it reported significant net losses last year.

7. Kimco Realty Corp. (NYSE: KIM) 

Kimco Realty may be a great option if you want to add a real estate stock to your portfolio. The firm’s real estate consists of strip malls but focuses on mainstays such as grocers or pharmacies, making it more reliable than other real estate firms. 

Kimco Realty reported it had leased a total of 4.5 million square feet and had an occupancy rate of 95.8% in its first quarter results. Despite the strong growth in online shopping and delivery over the pandemic, people have returned to stores since the removal of restrictions.

8. VF Corp. (NYSE: VFC)

VF Corp. owns some of the largest apparel brands around, such as The North Face, Vans, Timberland, Supreme and several more. However, apparel retailers have found current market conditions difficult, with consumers spending less because of high inflation and brands unable to keep up with the strong demand levels seen during the pandemic.

The decline in its shares now offers investors an opportunity to invest in VF Corp for a much lower price, with the potential for a recovery over the coming years, especially if consumer spending begins to pick up.

9. Kinder Morgan Inc. (NASDAQ: KMI)

Kinder Morgan is an energy infrastructure business headquartered in Houston, Texas. The company’s four divisions include Natural Gas Pipelines, Terminals, Products Pipelines and CO2. The company recently hiked its quarterly dividend by 2% and backed its FY23 EPS view of $1.12. 

Four Wall Street analysts currently have a Buy rating on the stock, with 5 at Hold and 2 at Sell. The consensus price target is $17.82 per share.

10. Uber Technologies Inc. (NYSE: UBER)

It is likely you have heard of Uber or use Uber often. Whether through its car service, Uber Eats app or its other apps and developments, the brand has become extremely well-known in recent years and has room to grow.

The stock has gained over 60% so far this year, with its Q1 metrics showcasing strong growth across all platforms. Its revenue increased 29% year over year, aided by gross bookings increasing 19%.

The stock is slightly more expensive than some of the others on this list, but the powerhouse is still priced at under $50.

Where to Buy Value Stocks

Before buying value stocks, you will need to be set up with a brokerage. You can find some of the best online brokers below.

What to Consider When Choosing Beginner Stocks

Investing in stocks is as simple as funding an account and picking the stocks you want to buy. But there are several factors to consider to refine your investing and create the ideal portfolio.

Historical Performance

Historical performance outlines how a security has reacted to past variables and changes in the market. Economic cycles can occur, with the most recent years showcasing how a stock has reacted to a high-inflationary market and its performance during a pandemic.

Although past indicators are not a determining factor for future performance, they can give further insight into a firm's reaction during different cycles.

Read up on Market Conditions

When evaluating a particular stock, market circumstances are crucial. A stock's performance may be affected by a variety of market factors, and a faltering market can have a negative impact on consumer confidence.

Review the Fundamentals

The fundamentals of a business will always be the deciding factor in its performance. It is crucial an investor looks into a firm’s financials and underlying factors that are impacting the business.

If a business is reporting weaker sales or further losses or is holding a large amount of debt, it is important to avoid getting caught on the wrong side. 

Growth Potential

If a stock has passed the previous checks, then another step is to evaluate if there is any growth potential. This can be a more personal attribute based on something, such as an upcoming trend or macroeconomic variable, that has caught your eye. During the pandemic, many piled into e-commerce retailers to profit from the shift to online shopping. 

You must be confident in your investments and believe there is some attribute or characteristic that can maximize returns.

Have Clear Investing Goals

Another personal consideration is to have clear and precise investing goals. Many investors want different things from the market. Some want steady returns, while others want rapid growth. But however big or small your goals are, they should help you decide exactly what you want to see in your portfolio.

Am I Ready to Invest?

Investing in the 21st century is available for everyone, regardless of experience or skill set. Outlining your investment goals and plans, as well as learning the fundamentals of the market, is vital. However, investing is not right for everyone, so it is important to consider your personal circumstances before jumping in.

Not everyone has the funds of Warren Buffett, but numerous stocks are available to start investing today with little money.

Frequently Asked Questions

Best Stocks for Beginners with Little Money Methodology

The stocks that were picked were chosen based on their share price being below $50 with a mix of well-known names and stocks considered slightly safer investments than others.