3 Low-P/E Stocks That Look Cheap as the S&P 500 Trades Near Record Highs

So far, value investors hunting for bargains have had a tough time finding them in a market where valuations are becoming more and more elevated. The result is that some of the biggest winners in the market also have price-to-earnings (P/E) multiples far above their long-term averages, forcing value-focused investors to take a chance on companies despite valuations outside of their comfort zone. This doesn't mean that deals don't still exist, however. While it may be increasingly rare, there are still firms that are of a high quality but that trade at low P/E ratios. Not the result of deteriorating business models, the companies below may be value prospects with the capacity to grow—their expanding profitability is evidence that they are solid investment targets that are just priced below what they may be worth.

Chinese internet and online gaming giant Sohu.com Inc. (NASDAQ: SOHU) trades at just 1.6x earnings, making it one of the most attractive bargains in the electronic gaming and media space. Indeed, a multiple that low might deter some investors who assume profits are on the verge of collapse. To the contrary, though, recent earnings suggest that the company's top- and bottom-line performance is trending in the other direction. Revenue climbed by about 7% year over year (YOY) for Q2 2026, driven by strength in Sohu.com's online gaming business. This same segment generated $55 million in operating profit for the quarter, a sign of its strong profitability. And speaking of profitability, Sohu.com improved its bottom line materially this quarter, with GAAP net income for the period compared to a sizable loss last year at the same time. Yes, the bottom line did benefit from a tax adjustment, but Sohu.com's underlying operations are solid enough to beat management expectations. With a healthy balance sheet that has facilitated some noteworthy share repurchases in recent quarters, SOHU stock has plenty of reasons to continue its upward trend after already rising by over 7% in the last month.

Onity Group (NYSE: ONIT) is a mortgage loan servicer that has undergone a significant transformation in the last several years, improving its servicing operations and expanding its reach. Despite a higher interest rate environment that could increase the value of mortgage servicing rights, ONIT shares are trading down more than 21% year to date (YTD). One reason for this is that the company's servicing adjusted pre-tax income has declined significantly, dropping by more than 60% YOY for the latest quarter amid changes to interest rates, geopolitical instability, market volatility, and similar. However, revenue climbed by almost a quarter YOY and fund originations surged by 64% over the same period to a record of...