Best stocks under $5 in Australia (2024)

We used Finder's proprietary algorithm to find the 10 best stocks under $5 on the ASX.

Important note

Unfortunately, there's no one magic stock that is 'best' for everyone. Instead, you should look into your own portfolio, individual needs and investment strategy to decide what stock is right for you. Further, nobody can say for certain which direction a share will go as past performance is no guarantee of future results. So keep in mind these are stock ideas only and should not be taken as personal financial advice.

It's not easy picking quality stocks.

To help identify stock picks that are currently under $5, we used Finder's proprietary algorithm to filter Australian-listed companies that have strong performance.

To avoid speculative stocks, we only include companies with a stock price of at least $1.

This doesn't mean these are the best stocks for you or your personal situation. Always do your own research and chat with a professional when in doubt.


1. Mesoblast (ASX:MSB)

  • Market cap: AUD$1.9 billion
  • Closed week at: $2.42 (up 34.44%)
  • 1-year performance: 706.67%
  • 5-year performance: 16.91%


2. Omni Bridgeway (ASX:OBL)

  • Market cap: AUD$385.75 million
  • Closed week at: $1.37 (up 30.48%)
  • 1-year performance: n/a
  • 5-year performance: -68.86%


3. Cettire (ASX:CTT)

  • Market cap: AUD$508.95 million
  • Closed week at: $1.34 (up 17.54%)
  • 1-year performance: -53.95%
  • 5-year performance: n/a


4. EZZ Life Science Holdings (ASX:EZZ)

  • Market cap: AUD$137.27 million
  • Closed week at: $2.91 (up 9.81%)
  • 1-year performance: n/a
  • 5-year performance: n/a


5. Auswide Bank (ASX:ABA)

  • Market cap: AUD$245.02 million
  • Closed week at: $4.73 (up 8.99%)
  • 1-year performance: -3.67%
  • 5-year performance: -19.01%


6. Austal (ASX:ASB)

  • Market cap: AUD$1.1 billion
  • Closed week at: $3.03 (up 8.21%)
  • 1-year performance: 74.14%
  • 5-year performance: -22.11%


7. Perenti (ASX:PRN)

  • Market cap: AUD$1.3 billion
  • Closed week at: $1.39 (up 6.11%)
  • 1-year performance: 34.95%
  • 5-year performance: -15.24%


8. Peninsula Energy (ASX:PEN)

  • Market cap: AUD$200.26 million
  • Closed week at: $1.26 (up 5.88%)
  • 1-year performance: -41.12%
  • 5-year performance: -54.35%


9. MyState (ASX:MYS)

  • Market cap: AUD$471.51 million
  • Closed week at: $4.25 (up 5.72%)
  • 1-year performance: 37.99%
  • 5-year performance: -12.01%


10. Kina Securities (ASX:KSL)

  • Market cap: AUD$319.62 million
  • Closed week at: $1.11 (up 5.71%)
  • 1-year performance: 40.51%
  • 5-year performance: -19.57%


How did we pick this list?

We use a proprietary algorithm that rates ASX-listed stocks based on price performance, profit, revenue and dividends. For more information about our methodology, head to our stock ranking page. The companies displayed on this page may not be the best for you and you're encouraged to do your own research. Investments can go up and down and we do not guarantee the performance of or returns of any investment.

Are stocks under $5 lower quality?

It's a common misconception that a higher price means a share is better quality.

Businesses with a higher share price are in many cases older, more established and have a long history on the ASX. While there's nothing wrong with buying these businesses, due to the size of the business/industry dominance, they might not have room to grow.

Remember in most cases over the long term, share price growth is a reflection of earnings growth. If a business keeps growing its earnings over time, its share price in theory will increase.

On the flip side, finding the right share under $5 could mean it is smaller but has a greater opportunity to grow. It could even take market share from the larger incumbents.

It is also not always the case that a smaller company based on its share price is in a worse position financially than larger businesses. In some instances it is simply the market mispricing a business. Once again though, it is important to find the right smaller company.

What to look for in stocks under $5

If you're looking to buy "cheap" stocks you should still follow the same investment formulas and investment themes that you would for any other stock. After all, when it comes to buying shares, you're investing your hard-earned money into a business that you hope will grow.

In order to understand a "fair value" for a share, there's a plethora of different metrics you can use.

It's important to remember each of these have their own limitations and few businesses will tick every single one of them.

Even if a business is on paper ticking every box it does not guarantee the price of the shares will rise.

But here are a few tips you can look out for:

  • Earnings per share (EPS): EPS is calculated by dividing company profits by the outstanding shares of common stocks. The valuation should give you an indication of a company's profits.
  • Price to earnings ratio (P/E ratio): In short the price to earnings for stock is how much the market is willing to pay today for a stock's past or future earnings. It is done by dividing a company's share price by its annual earnings per share. If for example a company is priced at $10 per share and its earnings per share is $1, then the P/E ratio would be 10/1 = 10. Theoretically, a lower P/E ratio means the company is cheap.
  • Price to sales (P/S): P/S is calculated for businesses that are not yet profitable. It is calculated by dividing the number of outstanding shares by the total sales or revenue over the last 12 months. The lower the P/S ratio, the more attractive the investment.
  • Profitability ratios: Not all businesses need to be profitable today to make for a good investment. But they need to have a path towards profitability. When it comes to measuring profitability, investors can use gross profits, operating profits, net profits, cash flow or even earnings before interest, taxes and depreciation and amortisation (EBITDA).
  • Debt ratio: This is especially important in a rising interest rate world. It is worked out by dividing the total debt by total assets. A debt ratio of greater than 1 suggests the company has more debt than its assets.

Buy stocks under $5 through an online broker

Name Product AUFST Price per trade Inactivity fee Asset class International
eToro
Exclusive
eToro logo
US$2
US$10 per month if there’s been no log-in for 12 months
ASX shares, Global shares, US shares, ETFs
Yes
Exclusive: Get 12 months of investment tracking app Delta PRO for free when you fund your eToro account. T&Cs apply.
Trade stocks, commodities and currencies from the one account and get access to social trading.
CMC Invest
Finder AwardExclusive
CMC Invest logo
$0
$0
ASX shares, Global shares, Options trading, US shares, ETFs
Yes
Finder exclusive: Get $100 trading credit when you transfer $10k+ of either Australian or international stocks to CMC Invest. Only available for the first 50 new clients to participate. Use promo code “100CMC”. T&Cs apply.
Trade over 45,000 shares and ETFs from Australia and 15 major global markets. Plus, buy Aussie shares or ETFs for $0 brokerage up to $1,000 (First buy order of each security, each day - excludes margin loan settled trades).
Tiger Brokers
Finder AwardExclusive
Tiger Brokers logo
US$1.99
$0
ASX shares, Global shares, Options trading, US shares, ETFs
Yes
Finder exclusive: Get 4 brokerage-free trades and pay no FX fees on the first $2,000 you exchange each month with first deposit of any amount + plus get an $80 cash voucher when you deposit up to $2000. T&Cs apply.
Trade US, Asian and CHESS-sponsored ASX stocks and US options.
Moomoo logo
US$0.99
$0
ASX shares, Global shares, Options trading, US shares, ETFs
Yes
Finder exclusive: Unlock up to AUD$4,000 AND US$4,000 in $0 brokerage over 60 days. T&Cs apply.
Trade US, Asian and CHESS-sponsored ASX stocks and get access to social trading.
Superhero logo
$2
$0
ASX shares, US shares, ETFs
Yes
Sign up with code ‘finder24’ and get US$10 of Nvidia stock when you fund your account with $100 or more within 30 days. T&Cs apply.
Enjoy US$2 brokerage (other fees may apply) on US stocks and buying ETFs as well as $2 fee to trade Australian shares up to $20,000.
loading

Important: The standard brokerage fee displayed is the trade cost for new customers to purchase $1,000 of either Australian or US shares. Where a platform charges different fees for both US and Australian shares we show the lower of the two. Where both CHESS sponsored and custodian shares are offered, we display the cheapest option.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades. Read the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for the product on the provider's website.
Cameron Micallef's headshot
Writer

Cameron Micallef was an investment and utilities writer for Finder. He previously worked on titles including Smart Property Investment, nestegg and Investor Daily, reporting across superannuation, property and investments. Cameron has a Bachelor of Communication and Media Studies/ Commerce from the University of Wollongong. Outside of work Cameron is passionate about all things sports and travel. See full bio

Cameron's expertise
Cameron has written 161 Finder guides across topics including:
  • Energy
  • Mobile
  • Internet
  • Streaming

More guides on Finder

Go to site