Stocks trading between $10 and $50 can be particularly interesting as they frequently represent businesses that have survived their early challenges. However, investors should remain vigilant as some may still have unproven business models, leaving them vulnerable to the ebbs and flows of the broader market.
This is precisely where StockStory comes in - we do the heavy lifting to identify companies with solid fundamentals so you can invest with confidence. That said, here are three stocks under $50 to avoid and some other investments you should consider instead.
Amplitude (AMPL)
Share Price: $12.16
Born out of a failed voice recognition startup by founder Spenser Skates, Amplitude (NASDAQ:AMPL) is data analytics software helping companies improve and optimize their digital products.
Why Does AMPL Worry Us?
-
Offerings struggled to generate meaningful interest as its average billings growth of 6.4% over the last year did not impress
-
Platform has low switching costs as its net revenue retention rate of 97.8% demonstrates high turnover
-
Suboptimal cost structure is highlighted by its history of operating losses
Amplitude is trading at $12.16 per share, or 4.7x forward price-to-sales. Dive into our free research report to see why there are better opportunities than AMPL .
Vishay Precision (VPG)
Share Price: $23.99
Emerging from Vishay Intertechnology in 2010, Vishay Precision (NYSE:VPG) operates as a global provider of precision measurement and sensing technologies.
Why Do We Avoid VPG?
-
Annual sales declines of 8.1% for the past two years show its products and services struggled to connect with the market during this cycle
-
Efficiency has decreased over the last five years as its operating margin fell by 3.9 percentage points
-
Earnings per share fell by 11% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
Vishay Precision’s stock price of $23.99 implies a valuation ratio of 21.2x forward price-to-earnings. To fully understand why you should be careful with VPG, check out our full research report (it’s free) .
Sealed Air (SEE)
Share Price: $28.51
Founded in 1960, Sealed Air Corporation (NYSE: SEE) specializes in the development and production of protective and food packaging solutions, serving a variety of industries.
Why Do We Pass on SEE?
-
Declining unit sales over the past two years indicate demand is soft and that the company may need to revise its strategy
-
Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable
-
Diminishing returns on capital suggest its earlier profit pools are drying up
At $28.51 per share, Sealed Air trades at 9.6x forward price-to-earnings. Check out our free in-depth research report to learn more about why SEE doesn’t pass our bar .
Stocks We Like More
The elections are now behind us. With rates dropping and inflation cooling, many analysts expect a breakout market - and we’re zeroing in on the stocks that could benefit immensely.
Take advantage of the rebound by checking out our Top 5 Strong Momentum Stocks for this week . This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free .