Got $5,000? These 3 Stocks Are Absurdly Cheap Buys Heading Into 2025

The stock market enjoyed a strong year in 2024 as the S&P 500 hit new records. The challenge for investors looking to get into the market amid such a strong bull run, however, is that valuations for some stocks have gotten high, perhaps even wildly overpriced.

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But there are still many good, reasonably priced investments that I believe have the potential to outperform the market -- not just in 2025, but over a longer stretch. If you have $5,000 you want to invest in stocks today, three excellent options are Pfizer (NYSE: PFE), L3Harris Technologies (NYSE: LHX), and Dell (NYSE: DELL).

Pfizer

Pfizer is a big name in healthcare, but it's trading at a steep discount -- just 9 times its estimated future earnings (based on analyst estimates). By comparison, the average stock in the Health Care Select Sector SPDR Fund trades at a forward P/E ratio of nearly 20.

You might think that there must be something seriously wrong with Pfizer for it to be trading at such a modest valuation. But there isn't. Sure, the company isn't generating boatloads of money from its COVID-19 vaccine anymore, but the business is still doing fairly well. For 2024, the company expects total revenue in the $61 billion to $64 billion range, which would be an improvement from the $58.5 billion it reported in 2023.

The company is expecting minimal growth in 2025 but investors shouldn't forget that it was only a year ago that Pfizer acquired oncology company Seagen, which promises to be a big growth driver over the long run. The company is also working on slashing costs as it realigns its operations due to reduced demand for COVID-19 vaccines. Meanwhile, it has 108 compounds in its drug pipeline that could provide more growth down the road.

There is some risk with Pfizer as it is scheduled to lose patent exclusivity on several of its top-selling drugs, including Eliquis and Vyndaqel, over the next few years. However, the company has been aggressively growing its development pipeline via investments and acquisitions. Investors shouldn't count out Pfizer, and buying the stock while it's at a depressed valuation could be a great move over the long run.

L3Harris Technologies

L3Harris is a top defense contractor, and trades at a forward price-to-earnings multiple of 15. That's not as deeply discounted as Pfizer, but it could still be a fantastic stock to invest $5,000 into right now.

The company is a provider of command and control systems, navigation products, tactical radios, and other products and services -- all of which could be in higher demand as geopolitical tensions rise around the globe.

With Republicans in control of Congress and the White House, U.S. defense spending could also increase significantly. In May 2024, Sen. Roger Wicker (R-Mississippi) -- the ranking Republican on the Senate Armed Services Committee -- said that a "generational investment" in defense was necessary given the rising risks posed to the U.S. from countries such as China, Iran, and Russia.

L3Harris is fundamentally strong, and has posted profits in each of its past four quarters, with a profit margin over that stretch of just under 6%. Given the potential for a surge in military spending under the Trump administration, L3Harris stock could thrive over the next four years.

Dell

One stock that doesn't seem to attract the bullishness it deserves these days is Dell. The computer manufacturer is only trading at a forward P/E of 13. This is a company that can benefit from advancements in artificial intelligence (AI) in multiple ways. The problem is, it isn't firing on all cylinders.

It has been experiencing a huge surge in its server and networking segment -- sales in that part of its business soared by 58% in the company's most recently reported fiscal quarter (which ended Nov. 1). Unfortunately, its client solutions group, which includes its personal computer business, experienced a 1% decline in net revenue.

But as interest in AI-capable PCs starts to pick up, sales from its client solutions group should improve significantly. When that happens, Dell could quickly become a hot AI stock. Buying shares before that happens could set you up for big gains down the road.

Should you invest $1,000 in Pfizer right now?

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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends L3Harris Technologies and Pfizer. The Motley Fool has a disclosure policy.