The $10-50 price range often includes mid-sized businesses with proven track records and plenty of growth runway ahead. They also usually carry less risk than penny stocks, though they’re not immune to volatility as many lack the scale advantages of their larger peers.
These dynamics can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. That said, here are three stocks under $50 to avoid and some other investments you should consider instead.
Academy Sports (ASO)
Share Price: $39.85
Founded in 1938 as a tire shop before expanding into fishing equipment, Academy Sports & Outdoor (NASDAQ: ASO) sells a broad selection of sporting goods but is still known for its outdoor activity merchandise.
Why Do We Think Twice About ASO?
- Sales trends were unexciting over the last five years as its 4.2% annual growth was below the typical consumer retail company
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 1.9 percentage points
Academy Sports is trading at $39.85 per share, or 6x forward P/E. To fully understand why you should be careful with ASO, check out our full research report (it’s free).
Helios (HLIO)
Share Price: $31.49
Founded on the principle of treating others as one wants to be treated, Helios (NYSE: HLIO) designs, manufactures, and sells motion and electronic control components for various sectors.
Why Do We Avoid HLIO?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Sales are projected to tank by 1.6% over the next 12 months as its demand continues evaporating
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 3.1% annually while its revenue grew
At $31.49 per share, Helios trades at 13.8x forward P/E. Dive into our free research report to see why there are better opportunities than HLIO.
Kennametal (KMT)
Share Price: $20.80
Involved in manufacturing hard tips of anti-tank projectiles in World War II, Kennametal (NYSE: KMT) is a provider of industrial materials and tools for various sectors.
Why Should You Sell KMT?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Projected sales for the next 12 months are flat and suggest demand will be subdued
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
Kennametal’s stock price of $20.80 implies a valuation ratio of 17.3x forward P/E. If you’re considering KMT for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
