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Top 5 ASX-listed cheap shares to watch in 2025
Cheap ASX stocks can offer exciting opportunities for both CFD traders and long-term share traders, but they also come with higher risks. In this guide, we explore what makes a stock ‘cheap’, the pros and cons of trading them, and highlight five undervalued companies under A$5 to watch in 2025.
Important to know
This article is for informational purposes only and does not constitute investment or trading advice. Please ensure you understand the risks and consider your individual circumstances before trading.
Key takeaways
- Cheap shares aren’t always necessarily good value; low-priced ASX stocks can offer strong upside, but they’re often volatile and carry higher risks than blue chips
- Research is essential – look beyond price tags; analyse financials, industry outlook and growth potential to decide if a stock is truly undervalued
- The five highlighted companies in our article show promise across mining, travel, finance and tech, but traders should manage risk carefully when investing or trading CFDs
What are cheap shares?
It’s tricky to define what ‘cheap’ shares are – this largely depends on your point of view. But one thing you can say about them is that they tend to be undervalued.
For our article, we’ve looked at ASX-listed cheap stocks under A$5 per share, all of which the data indicate are undervalued.
The idea is that you buy a company’s shares cheaply before they rise in value, making yourself a decent profit. But buyer beware: Cheap stocks can be deceiving. Just because they’re priced for entry doesn’t mean they make good investments. They can be volatile – a factor that’s good for CFD trading – but not so much for share trading.
How do I find cheap shares?
It’s important to do more than just read articles on potentially undervalued shares – you need to look at their financials in detail (like their balance sheet and income statements) and technical indicators to determine whether they’re truly worth investing in.
One way to start your search for cheap shares is to use our stock screener. You can filter by price and a range of other measures, such as sector, market cap and dividend yield.
Advantages of cheap shares
- High return potential: If a company grows, its cheap shares can also increase – almost exponentially. There are major opportunities for share traders to make sizeable profits; many well-known blue-chip shares of today once started as cheap stocks, such as BHP and Afterpay
- Affordable shares: As the stocks don’t cost a lot, cheap shares provide an affordable entry point for share traders seeking to climb the stock market ladder
- Emerging industry investment: Cheap shares that grow as investors desire tend to be in emerging industries, such as tech, or have proprietary methods for producing their products. This gives share traders and CFD traders exposure to up-and-coming technology
Risks of cheap shares
- Low liquidity: Because they don’t get as much attention as more popular shares do, cheap stocks can often have lower liquidity, so you might find it difficult to offload your shares when you’re ready to sell them
- Potential for fraud: Scammers love a pump-and-dump scheme, and cheap shares are often the vehicle for them to con share traders out of their money
- Volatility: If you’re looking to trade CFDs on cheap shares, their volatility creates the ideal conditions for opportunities. However, when share trading, volatility is the enemy, because you want your shares to see a steady rise, ideally. This is rarely the case, as all stocks go through ups and downs in the market, but it’s what you hope for nonetheless
Top 5 ASX-listed cheap shares to watch in 2025
We chose the five shares on this list primarily due to their potential to be currently undervalued. Not all of them have seen gains in the past few months, but they do present opportunities for CFD and share traders to make a profit.
However, it’s vital to remember that these shares are extremely volatile and there’s no guarantee they’ll rise in value. You could lose all your money if you trade them.
Overview of the shares in this article
All the shares in our article can be traded via CFDs with us, as well as via share trading.
Figures in this list are accurate as of 22 September 2025.
Company |
Industry |
Market cap |
Share price |
Available to trade via CFDs with us |
Available for share trading with us |
Mining |
A$936.27 million |
A$3.70 |
✓ |
✓ |
|
Travel |
A$1.49 billion |
A$4.09 |
✓ |
✓ |
|
Finance |
A$4.94 billion |
A$1.70 |
✓ |
✓ |
|
Technology |
A$154.96 million |
A$1.10 |
✓ |
✓ |
|
Mining |
A$1.11 billion |
A$4.59 |
✓ |
✓ |
1. Brazilian Rare Earths (ASX: BRE)
Industry: Mining
Market cap: A$936.27 million1
Share price: A$3.70
Brazilian Rare Earths is an explorer and early-stage developer with a focus on large rare-earth element (REE) deposits in northeast Brazil. It owns tenements in a region with high grades of the critical rare earths used in permanent magnets and EV/wind technologies.
The company’s management has rapidly advanced drilling and resource work since listing, producing headline resource and grade updates that caught investor attention.
Why it could be undervalued
- Early-stage resource growth vs market cap: For some share traders, the gap between resource potential and current market valuation looks wide, especially when commodity pricing and demand for REEs are rising
- Sector potential: Brazilian Rare Earths benefits from favourable geology and a narrative that countries want to move away from Chinese supply sources
- Prospects: Positive results can reduce project risk and may swing share trader sentiment from speculative to valuation-based. Recent fundraising previously pushed the share price higher, showing sensitivity to news
2. Webjet Limited (ASX: WEB)
Industry: Travel
Market cap: A$1.49 billion2
Share price: A$4.09
Webjet has historically been a large Australian online travel company with two distinct operating arms: business-to-business wholesale accommodation (WebBeds/Web Travel Group) and business-to-consumer travel booking platforms (Webjet Group/online travel agency (OTA) brands).
Recently, the company undertook a formal demerger to separate the two businesses, so each can run on its own strategy and be valued independently. This structural change is important for share traders because the market can now value the consumer OTA and the wholesale bed-supply businesses separately.
Why it could be undervalued
- Demerger simplification: When a multi-segment company splits, each stand-alone business can sometimes trade lower than the sum of its parts in the short term. That opens up opportunity: If the market re-rates each company on metrics such as growth, margins for OTA, scale and contract depth for wholesale, there might be a catch-up
- Post-Covid recovery: If share traders underprice the post-pandemic normalisation of travel, dividends in earnings can surprise to the upside. Recent FY reporting and group financials show the business is generating cash and revenue recovery
3. GQG Partners Inc (ASX: GQG)
Industry: Finance
Market cap: A$4.94 billion3
Share price: A$1.70
GQG Partners is an active investment manager that runs global and emerging-market equity strategies for institutional and retail investors.
The business model is asset-management based – revenue scales with assets under management (AUM) through management and performance fees when portfolios beat benchmarks. GQG has grown in recent years thanks to performance and distribution expansion.
Why it could be undervalued
- AUM sensitivity: Market downturns can cause outsized valuation drops, even if longer-term performance is solid. This sometimes creates buying opportunities for share traders who believe in asset manager skills and long-term flows
- Fee pressure and competition: Passive investing and fee compression are structural risks for active managers. If GQG maintains strong outperformance and differentiates its products, it can command premium fees – but the market’s discount for potential fee erosion can make the stock look cheap at times
- Earnings leverage: Profitability in asset managers can grow faster than revenue, once fixed costs are covered. If GQG’s performance attracts net inflows, earnings per share can grow quickly, and the market may re-rate the stock. That growth leverage is a reason why value share traders watch AUM growth closely
4. Acusensus (ASX: ACE)
Industry: Technology
Market cap: A$154.96 million4
Share price: A$1.10
Acusensus develops AI and camera-based systems to detect dangerous road behaviour, primarily distracted driving (mobile phone use), seatbelt compliance and related road-safety enforcement technology.
Its business model mixes hardware/software, recurring data-analysis contracts and service agreements with government and enforcement agencies.
Why it could be undervalued
- Revenue model and recurring streams: Once enforcement programmes are contracted, they commonly create recurring revenue from data, monitoring and enforcement-service fees. If share traders don’t appreciate the sticky nature of municipal and fleet contracts, current prices can look conservative compared to long-term cash flows
- Scalable SaaS-like economics: Some share traders are pricing the company as a hardware play rather than a recurring-revenue software business, which can create mispricing
- Market expansion: Road-safety enforcement is a global need, and several areas are piloting AI camera enforcement. If Acusensus wins larger national programmes or converts pilots into long-term contracts, revenue could re-accelerate; the market often lags on re-rating such contract wins
5. Vulcan Energy Resources (ASX: VUL)
Industry: Mining
Market cap: A$1.11 billion5
Share price: A$4.59
Vulcan aims to produce ‘zero-carbon’ lithium by extracting lithium from geothermal brines in Germany’s Upper Rhine Valley and pairing extraction with renewable heat/electricity from geothermal wells. The company’s position is unique – it can deliver a lower-carbon lithium product that’s attractive to auto manufacturers and battery makers
Why it could be undervalued
- Funding milestones: Vulcan has reported commercial-scale contracts and government/European funding support (including material grants and pre-qualified debt), which reduce financing risk. If share traders discount those milestones, the stock can look relatively cheap
- Premium prices: Automotive OEMs increasingly prefer lower-carbon battery inputs to meet supply-chain emissions targets. Vulcan’s product can command premium prices, meaning its future cash flows could be higher than traditional hard-rock or brine producers. Markets don’t always fully price that premium early
- Execution gap: The company is beyond pure exploration – it has demonstration plants and an early production history, but scaling remains the next step. If share traders are sceptical about large-scale execution, the share price can lag
How to trade ASX-listed cheap shares with IG AU
CFDs
- Open a CFD trading account with IG AU
- Search for ASX-listed cheap shares on the IG platform
- Decide whether to go long (buy) or short (sell)
- Choose your position size
- Set stop-loss and limit orders
- Place your trade and monitor it
Share trading
- Open a share trading account with IG AU
- Search for ASX-listed cheap shares
- Choose the shares you want to buy
- Determine how many shares you want to purchase
- Place your order
- Monitor your investment and collect any dividends
FAQs about cheap shares
Are cheap shares and penny stocks the same?
Almost, but not quite. Penny stocks refer to shares that are worth A$1 or less, while the value of cheap shares differs according to each person’s perception. In this article, we looked at ASX-listed shares with a value below A$5.
Cheap shares can also sometimes be referred to as ‘undervalued’, meaning the market might not have caught up with the value of the stock yet.
Is a low share price bad?
Not necessarily. A low share price can indicate that a company is in trouble or isn’t performing as well as it should, but it can also be a sign that a company is undervalued, meaning it’s a good time to buy shares before the market catches up to its value.
With that in mind, remember that not all cheap shares will go on to become big players – some might stay cheap forever, while others might fail completely.
Can a share’s value go to zero?
Yes, a share’s value can go to zero if it loses enough value. When this happens, the stock is worthless, and the company will likely declare bankruptcy.
Footnotes
- TradingView, September 2025
- TradingView, September 2025
- TradingView, September 2025
- TradingView, September 2025
- TradingView, September 2025
Important to know
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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