10 Best Value Stocks to Buy in December 2025

Value investing is the art of uncovering hidden gems in the stock market. It involves finding stocks that trade for less than what they are really worth, but with plenty of potential.

Some of the world’s best-known investors, including Warren Buffett, Mohnish Pabrai, and Benjamin Graham, have become successful using a value-investing approach. Value investors apply market metrics to find stocks with a competitive edge that have every chance to outperform the market. It takes a little work, but everyday investors can use those same methods to find the best value stocks.

To help you apply the concept, we picked what in our analysis are the 10 best value stocks available now.

An in-depth look at these top value stocks to invest in

For this guide, we looked for profitable companies priced at less than 16 times their earnings (trading for a price-to-earnings (P/E) ratio of 16 or below).

Our picks are varied by sector and geographic location, but they all have a long history of being profitable, deliver an above-average dividend, and had growing revenue as of their last quarter:

1. Bank of America: Value stock with growing revenue, earnings and dividend

Bank of America (NYSE:BAC) shares have been sluggish, up less than 1% so far this year and more than 13% over the past year, but the company has a solid base and is trading at under 14 times earnings.

As the largest US bank by checking account deposits it enjoys strong margins compared to competitors. It has $1.08 trillion in assets under management (AUM), also making it the second-largest wealth manager in the world behind UBS.

The company, in the first quarter, reported EPS of $0.90, up 18.4% from $0.76 in the same quarter last year. Revenue, net of interest expense, rose 6% during the three month period year over year to $27.4 billion, thanks to improved noninterest income across all segments and higher net interest income (NII). 

Speaking of NII, that was up by 3% year over year, to $14.4 billion.

The company continues to grow new accounts for the 25th consecutive quarter, rising by 250,000 net new accounts in the quarter.

The company operates in four segments, Consumer Banking, Global Banking, Global Wealth and Investment Management, and Global Markets. The last two led the way with year-on-year revenue growth of 8% and 11%, respectively.

It has also shown a commitment to its dividend, which yields around 2.31%. The company has increased its dividend for 11 consecutive years, including an 8% bump last year to $0.26 per quarter. The payout ratio is only 34.24%, so there’s plenty of room for continued increases.

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2. JP Morgan Chase: Solid growth, steady dividend increases

JP Morgan Chase (NYSE:JPM) is the largest bank in the world in terms of market cap at $746 billion and holds $4 trillion in assets. The stock is up more than 9% this year and more than 38% over the past year.

The financial services company has separate divisions for Consumer and Community Banking, Corporate, Commercial and Investment Banking, and Asset and Wealth Management.

The company’s stock has risen when other banks are struggling, a sign that the company’s size and scope give it a significant edge.

In the first quarter, the bank had revenue of $45.3 billion, up 8% year over year. EPS was $5.07, up 14% over the same period last year. The company’s top performing segment was Asset and Wealth Management and Corporate, which saw revenue rise 12% and net income climb 23% year over year.

Commercial and Investment Banking also did well, with revenue increasing 12% and net income rising 5% year over year.

The company has increased its dividend for 14 consecutive years, including a 12% boost this year to $1.40 per share, equaling a yield of around 2.08%.

The payout ratio is only 25%, a conservative amount that allows for future increases. The company has also been actively buying back stock, despite the rise in its share price.

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3. CVS Health: Diversified healthcare giant is turning its financials around

CVS (NYSE:CVS) shares are up more than 48% so far this year and more than 8% over the past year. Investors are encouraged by the company’s turnaround, which includes new leadership, better-than-expected first-quarter earnings and a stronger Aetna segment.

The company operates more than 9,000 pharmacies in the US, plus more than 1,000 walk-in and primary care medical clinics, a leading pharmacy benefits manager 

In the first quarter, revenue rose 7% from the same quarter a year earlier to $94.6 billion, with growth across all of its segments, and EPS of $1.41, up 60%, year over year.

Investors were also encouraged by the company’s improved full-year guidance of adjusted EPS raised to between $6 and $6.20, from an earlier estimate of between $5.75 and $6. CVS also raised its full-year 2025 cash flow from operations prediction to approximately $7 billion, up from roughly $6.5 billion.

CVS has increased its dividend for three consecutive years, including a 9% raise last year to $0.665 per quarterly share, and has never cut its dividend. The yield on the dividend is 4.11%, though the payout ratio at 63%, is a tad high. However, if the company continues to improve revenue, there will be plenty of cash on hand for continued dividend raises. 

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4. Sekisui House: International homebuilder with steady growth, dividend

While Sekisui’s stock is down more than 12% so far this year and more than 5% over the past year, its steady revenue growth and above-average dividend yield make it a solid value pick.

Though Sekisui (OTC:SKHSY) is based in Japan, thanks to its $4.9 billion acquisition of MDC Holdings in 2024, it is now the fifth-largest homebuilder in the US. The company operates in four different segments, Overseas, Development, Supplied Housing and Built to Order.

It has a partnership agreement with Brookfield Residential that gives the pair $1.6 billion in real estate assets in the US and they have a combined portfolio of more than 30,000 single-family lots under management in hot real estate markets such as Austin, Phoenix, Denver, and Northern California.

In the first quarter, it reported revenue of $6.25 billion, up 15.1% year over year, though EPS fell 33.8% from the year-earlier quarter to $0.33. It has a huge backlog, though, amounting to 1.9 billion properties, a 10.9%, year-over-year increase, so revenue should continue to grow.

Over the past 10 years, it has increased its twice-yearly dividend by 10.41%, including a 1.3% raise this year in its interim dividend. The yield is around 4.4% and the payout ratio is 43%, meaning it is likely to continue to grow.

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5. Segro: Data center demand should boost REIT’s bottom line

UK-based real estate investment trust (REIT) Segro (OTC:SEGXF) focuses on warehouses near major cities in Europe. Its largest customers are IKEA and Deutsche Post. It owns or manages 10.3 million square meters of space (111 million square feet) valued at £20.3 billion.

In the first quarter, the company posted a solid customer retention rate of 92% and an occupancy rate of 94%. The stock is up more than 15% so far this year but down by more than 16% over the past year.

In fiscal 2024, the company reported International Finance Reporting Standards (IFRS) earnings per share of 44.7 pence, up from a loss of 20.7 pence per share in 2023. It had an adjusted profit before tax of £470 million, rising 14.9%.

In the UK, REITs must distribute 90% of property income profits each year, so their dividend yields are often higher than those of other equities, in many cases. Segro has a dividend payout ratio of 83%, which is about average for a UK REIT.

Segro increased its annual dividend in 2024 by 5.4% to 29.3 pence, equaling a yield of around 4.28%. It has increased its dividend for 10 consecutive years.

REITs are becoming more attractive in the UK to investors because of an increase in the UK corporation tax rate from 19% to 25% in 2023. REITs, because of their unique structure, are generally taxed at 20% or lower. Segro is seeing additional growth because of the potential for more data centers in the UK.

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6. BNP Paribas: One of the best dividends in Europe

The French bank, which dates back more than 200 years, has seen its stock rise more than 43% so far this year and more than 23% over the past year. Despite that, it remains an underpriced value stock and the company, seeing that, has launched a €1.08 billion share buyback program.

Its total assets of €2.70 trillion make it the second-largest banking group in Europe. On top of that it has a dividend that yields slightly more than 6%.

In the first quarter, it had revenue of €12.9 billion, up 3.8% year over year while net income fell 4.9% to €2,95 billion, but that comparison must take into account a high amount of exceptional items in the first quarter of 2024. 

The company has three segments: Commercial, Personal Banking & Services; Investment & Protection Services; and Corporate & Institutional Banking. The last was the big start this past quarter, with €5.28 billion in net income, rising 12.5% year over year.

The company also made its dividend more attractive by changing it solely from an annual dividend and adding an interim dividend, which will be paid semi-annually and will amount to 50% of the net EPS of the first half-year, with the first payment expected in late September. 

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7. Allianz: Dominant position allows it steady revenue, dividend growth

Munich-based Allianz (OTC:ALIZY), has five segments: Property-Casualty, Life/Health, Asset Management, and Corporate and Other. In the first quarter, the Life/Health segment was the big driver but its other segments also saw growth. Its stock is up more than 29% this year and more than 43% over the past year. 

In the first quarter, it reported record operating profit of €4.2 billion, up 6.3% year over year. Revenue for the quarter came in at €54 billion, up 11.7% and core EPS grew 2.9% over the same period last year to €6.61. The company reiterated yearly guidance to show €16 billion in operating profit, give or take a million euros.

The company has a strong commitment to shareholders, which is what makes it a value stock. It just wrapped up a €1 million share buyback program and instituted another one of €2 billion.

It raised its annual dividend by 11.6% this year to €15.4, equaling a yield of 4.38%. Over the past 10 years, the company’s annual dividend increases have averaged 8%. Its policy is to keep its dividend payout ratio at around 60%.

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8. T. Rowe Price Group: Ready for whatever the market bears

T. Rowe Price (NASDAQ:TROW), a global asset manager, provides investment services, retirement leadership, and independent proprietary research. Its shares are down more than 18% this year and more than 20% over the past year. 

Its size and history makes it a solid value pick because it is well-positioned to succeed in times of uncertainty.

The company is a dividend aristocrat that has increased its dividend for 39 consecutive years, including a boost of 2.42% this year to $1.27 per share, delivering a yield of around 5.35% and a payout ratio of 53%, well within its safety guidelines to be able to deliver future increases.

The asset manager has increased its various fund offerings lately, adding a whole slate of actively managed ETFs, now number 22. It is known more for its active management than its passive investments.

In the first quarter, the company reported revenue of $1.76 billion, up 0.8% year over year. EPS was $2.15, down 13.7% from the same period last year. It had an average AUM of $1.6 trillion in the quarter, an increase of 9.2% year over year.

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9. Toyota Motor Corp.: Solid value stock for the future

Toyota (NYSE:TM) is behind Tesla in market cap, but the Japanese company still produces more cars than any other company. Its shares are down more than 7% so far this year and more than 10% over the past 12 months.

In the fourth quarter of fiscal 2025, the company reported EPS of $3.39, down 32% year over year. Revenue, however, was up 8.7% to $85.9 billion, which was a record quarter for the company.

The profit was down partly because of a certification scandal, but that seems like a temporary problem as the company is strengthening its testing systems for its cars.

Looking forward, Toyota is predicting 2026 revenue to be $337 billion, up 1%, though it was less bullish in its full-year profit forecast, with an expectation of $1.3 billion, down 35%, to $21.5 billion. The driver behind that would be the costs to meet carbon neutrality demands, as well as the impact of US tariffs.

The carmaker’s size and scope, however, make it a good value pick, in addition to its semiannual dividend, which yields 2.96%, including a 20.7% raise this year. The company is predicting another dividend increase of 5% in fiscal 2026.

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10. Andritz Group: Overlooked industrial gem with a great dividend yield

Austria’s Andritz (OTC:ADRZY) is trading at a P/E of 13.67 even though the stock is up more than 24% this year and more than 8% over the past year. Though it has more than 30,000 employees, it’s a stock that not all value investors know about because it doesn’t sell products that consumers are familiar with.  

The company operates through four segments: Pulp and Paper; Metals; Hydro; and Separation. It has shown it can grow through acquisitions and it recently said it was in the process of buying Diamond Power International, a maker of advanced boiler cleaning systems.

The takeover will be beneficial to Andritz’s recovery and boost its power boiler service business. In February, Andritz bought  LDX Solutions, a US provider of emission reduction technologies and related services.

The company is coming off a sluggish quarter. It reported first-quarter revenue of €2.02 billion, down 6.6% year over year. Net income was €102 million, down 14.3% from a year earlier.

However, the company is also seeing a 20% uptick in orders, driven by renewables and pulp projects. Andritz is a favorite of value investors because of its outstanding annual dividend.

It increased it by 4% last year to €2.60, equaling a yield of 4.23%. The company has increased its dividend for five consecutive years and with a payout ratio of 9.64%, that streak is likely to continue for a while.

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Year-to-date performance of these top-ranked value shares

Compare our 10 top picks, their year-to-date performance and price to earnings (P/E) ratio in an easy-to-view format.

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The case for investing in value stocks

It’s very difficult to time the market. However, long-term investors have found that having a portfolio that includes value stocks can deliver steady returns. Other reasons to invest in value stocks:

Value stocks perform well in economic downturns

Value stocks, because they have steady cash flows and business models, tend to be less affected by economic downturns than growth stocks.

In some ways, that’s due to traditional investor sentiment because these stocks are often turned to during recessions because they are seen as safe-harbor investments.

They can offer above-average dividends

As most value stocks also offer a dividend, that gives investors a steady income source and another reason to be patient while waiting for a stock’s price to rise.

Many value stocks have a consistent history of strong shareholder returns through a dividend as well as stock repurchases.

They can provide stability

Value stocks tend to be large-cap companies that have enormous resources and the wherewithal to withstand typical business headaches such as lawsuits, unfavorable media attention and short-term business downturns.

How to identify the best value stocks to invest in

There’s no one-size-fits-all approach to identifying the best value stocks. Investors need to combine long-term analysis while determining if a stock is a true bargain. There are several ways to help finding a value stock:

Use key financial ratios

A company’s price-to-earnings ratio (P/E) and price-to-book (P/B) can help determine if a stock is underpriced. It’s important, though, to compare a stock within its sector, as that will help show if a stock is inexpensive for a short-term reason or a long-term reason.

Track the company’s performance

Sometimes, there’s a good reason why a stock might appear to be inexpensive when it really isn’t. If a company’s long-term revenue trends downward, that’s more likely a value trap than a solid value stock.

Look for companies who, despite short-term bad news, continue to show revenue growth and long-term earnings growth. That’s a good way of finding the best value stocks right now.

Analyze catalysts that could affect the stock

There are plenty of less obvious factors that help explain a company’s true value. A company under new management could signal a turnaround effort, but it could also mean there’s a big need for a turnaround.

Industry trends, such as supply-chain issues, inflation or a shift in demographics could mean growth or a cliff ahead for a stock.

Value stocks come in all industries. There’s no shortcut to finding a good value stock as it requires research, both to understand a company’s fundamentals, but also to see which way industry trends are going.

Analytics can help you find potential value stocks, but you also need to see if a company is on the right track and has competitive advantages. If you use any stock screeners or stock prediction services, the same rule applies.

These tools may help you narrow down your list of stocks but ultimately, they are no substitute for due diligence and close examination of the current and possible future value of each stock you may be considering.

While a company with a solid track record is a good start, it’s important to find stocks with competitive advantages that should extend into the future and ones with dividends that are safe. 

Auto stocks, banking stocks and housing stocks both provide good potential for value right now because investors are still reluctant to buy their stocks due to short-term head winds that could change rapidly, due to interest rates.

Alternative ways of investing in value stocks

eToro smart portfolio for value stocks

eToro offers a Smart Portfolio, a bundle of assets for hands-off investing, specifically for value stocks, called ValueGurus. 

eToro’s Smart Portfolios are curated, thematic investment products designed to simplify diversification for investors. They are essentially pre-built portfolios of assets (stocks, ETFs, sometimes crypto) that are managed by eToro’s team or in partnership with other firms, based on a specific investment strategy or theme.

The ValueGurus Smart Portfolio aims to invest in companies that are believed to be undervalued by the market, drawing upon the principles of value investing. It’s designed for long-term investors looking for a professionally managed portfolio that focuses on this strategy.

According to eToro, the ValueGurus Smart Portfolio is based on the 13F filings (quarterly reports that large investment managers file with the SEC disclosing their US stock holdings) of some of the world’s most successful value investors. This means the portfolio’s composition is updated quarterly to reflect the holdings of these “value gurus.”

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Pros and cons of investing in value stocks

Value investing is a strategy that involves identifying and purchasing stocks that are trading for less than their intrinsic, or true, worth. The belief is that the market has undervalued these companies for various reasons, and eventually, their stock price will rise to reflect their true value.

This approach often involves looking for companies with strong fundamentals, stable earnings, and sometimes, a history of paying dividends, but whose stock price has been depressed due to temporary setbacks, negative sentiment, or simply being overlooked by the broader market.

Some of the advantages of value stock investing

• Potential for capital appreciation: The core appeal of value investing is the opportunity to buy a stock at a discount and profit when the market eventually recognizes its true value, leading to a significant increase in its price.
• Margin of safety: Because value stocks are purchased below their perceived intrinsic worth, they offer a “margin of safety.” This means there’s less downside risk, as the price already accounts for a certain level of pessimism or existing problems.
• Lower volatility: Value stocks tend to be less volatile than growth stocks. They often belong to mature, established companies with stable business models, making them more resilient during market downturns and economic uncertainties.
• Dividend income: Many value companies are well-established and generate consistent cash flow, which they often return to shareholders in the form of dividends. This provides a steady income stream that can be particularly appealing during periods of low market growth or for income-focused investors.
• Diversification: Including value stocks in a portfolio can provide diversification, as their performance often differs from that of growth stocks. This can help balance a portfolio and reduce overall risk.
• Outperformance in certain market conditions: Historically, value stocks have shown periods of outperformance, especially during times of higher inflation or rising interest rates, as investors seek out companies with strong fundamentals and stable earnings.

Some of the drawbacks of value stock investments

• “Value traps”: One of the biggest risks is falling into a “value trap.” This occurs when a stock appears cheap, but its low valuation is justified due to fundamental problems with the business that may lead to continued decline or stagnation. The stock may remain undervalued indefinitely.
• Requires patience: Value investing is a long-term strategy. It can take a significant amount of time for the market to recognize the true value of an undervalued company, meaning investors may have to wait years before seeing substantial returns.
• No guarantee of appreciation: There’s no guarantee that a value stock will ever reach its intrinsic value. The market might be correct in its low valuation, or the company’s prospects could deteriorate further.
• Missed growth opportunities: By focusing on undervalued companies, value investors might miss out on the rapid growth potential offered by innovative, high-growth companies.
• Thorough research required: Identifying true value stocks requires extensive fundamental analysis and due diligence. Investors need to understand the company’s business model, financial health, competitive landscape, and future prospects to avoid value traps.
• Can be unpopular: Value stocks are often unpopular or overlooked by the broader market, which is precisely why they might be undervalued. This means they might not attract significant investor attention or momentum.

Summary of the pros and cons

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Methodology: Choosing the best value stocks

We looked for stable, large-cap companies that were undervalued, based on their P/E, and also have an above-average dividend. The emphasis was on steady, if unspectacular revenue growth and profitability.  

Understand the business thoroughly 

Only invest in businesses you truly understand. If you can’t explain how the company makes money, its competitive landscape, and its long-term prospects in simple terms, don’t invest.

This prevents you from chasing trendy or complex companies you don’t grasp. Research the company’s products/services, industry, target market, and management team. Read annual reports (10-K), quarterly reports (10-Q), and investor presentations.

Does it have an above-average dividend?

Many value stocks, because they have stable cash flow, deliver an above-average dividend. That gives investors a steady stream of income on top of any potential stock price appreciation and encourages long-term investing.

What’s the stock’s financial health?

We looked for stocks with consistent growth in revenue and healthy profit margins, solid debt-to-equity ratio, good dividend history and reasonable valuations. 

Does it have a financial moat?

We looked for companies with a “moat” – a sustainable competitive advantage that protects its long-term profitability and market share. Examples include:

• Brand power: (e.g., Toyota)
• Cost advantage: (e.g., CVS’s supply chain)
• High switching costs: (e.g., Bank of America, BNP Paribas, JP Morgan Chase)
• Patents/proprietary technology: (e.g., Andritz Group)

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