A low share price doesn’t translate to low potential for returns. It just means you don’t need as much money to get started investing.
There are plenty of stocks that are good candidates with relatively low share prices. I think that a few stand out above the others, though. Here are three no-brainer stocks to buy right now for less than $50.
1. Brookfield Infrastructure
You have two choices with Brookfield Infrastructure (NYSE: BIP) (NYSE: BIPC). Its limited partnership (LP) units trade under the BIP ticker, while the corporate entity shares trade under the BIPC ticker. Either way, you’ll spend less than $35 to pick up one share. I think the investment could pay off nicely over time.
As its name indicates, Brookfield Infrastructure owns infrastructure assets. The company is well-diversified with a portfolio that includes cell towers, data centers, pipelines, railways, toll roads, and utilities. The company operates in North America, South America, Europe, Asia, and Australia.
Brookfield Infrastructure continually looks for new assets. Its strategy is to acquire them at attractive prices to achieve internal rates of return of between 12% and 15%. The company sells mature assets from time to time to reinvest in buying new, higher-growth opportunities.
One nice plus with Brookfield Infrastructure is you get paid to own it. BIP offers a distribution yield of a little over 5%, while BIPC’s yield is currently at nearly 4.4%.
The company has increased its distribution for 14 consecutive years. It expects to keep that streak going with an annual distribution growth target of 5% to 9%.
2. Enterprise Products Partners
Enterprise Products Partners (NYSE: EPD) is another LP that looks like a great pick right now. You won’t need much cash to buy it, either, as its share price is below $30.
Few midstream energy companies have the scale of Enterprise Products Partners. It operates over 50,000 miles of pipelines in the U.S. plus 31 natural gas processing plants, 26 fractionators (facilities for separating hydrocarbons), 20 deepwater docks, and more.
Enterprise’s business is highly resilient. The company has delivered returns on invested capital (ROIC) of at least 10% in every year since 2005. This period included some turbulent times, including the financial crisis of 2007 and 2008 and the COVID-19 pandemic lockdowns of 2020 and 2021.
You won’t need a lot of share-price appreciation for Enterprise Products Partners to make you money because the company pays a distribution that currently yields 7.7%. Enterprise has increased its distribution payout for 25 consecutive years at a compound annual growth rate of 7%.
3. Pfizer
Less than $30 will enable you to buy a share of one of the biggest drugmakers on the planet — Pfizer (NYSE: PFE). And while Pfizer has been a loser for investors over the last couple of years, I think its stock trajectory will soon change.
The company’s problems center on the declining demand for its COVID-19 products. Pfizer also faces patent expirations for some of its top-selling drugs. But brighter days could be ahead.
Pfizer expects to add around $20 billion in annual revenue by 2030 from new product launches and new indications for existing products. It also believes it will generate an additional $25 billion per year by 2030 from business development deals.
The stock’s valuation is very attractive, relative to its peers. Even better, Pfizer offers a juicy dividend yield of over 5.9%. You’ll need to be patient with this beaten-down big pharma stock. However, I think that patience will be rewarded over the next several years.
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Keith Speights has positions in Brookfield Infrastructure, Brookfield Infrastructure Partners, Enterprise Products Partners, and Pfizer. The Motley Fool has positions in and recommends Pfizer. The Motley Fool recommends Brookfield Infrastructure Partners and Enterprise Products Partners. The Motley Fool has a disclosure policy.
3 No-Brainer Stocks to Buy Right Now for Less than $50 was originally published by The Motley Fool
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