The past year hasn't been kind to the stocks featured in this article. Each has tumbled to their lowest points in 12 months, leaving investors to decide whether they're witnessing fire sales or falling knives.
Price charts only tell part of the story. Our team at StockStory evaluates each company's underlying fundamentals to separate temporary setbacks from structural declines. Keeping that in mind, here is one stock poised to prove the bears wrong and two facing legitimate challenges.
Two Stocks to Sell:
Merit Medical Systems (MMSI)
One-Month Return: -11.6%
Founded in 1987 and now offering over 1,700 patented products across global markets, Merit Medical Systems (NASDAQ: MMSI) manufactures and markets specialized medical devices used in minimally invasive procedures for cardiology, radiology, oncology, critical care, and endoscopy.
Why Does MMSI Worry Us?
- Modest revenue base of $1.54 billion gives it less fixed cost leverage and fewer distribution channels than larger companies
- Underwhelming 5.2% return on capital reflects management’s difficulties in finding profitable growth opportunities
Merit Medical Systems is trading at $62.55 per share, or 15.3x forward P/E. To fully understand why you should be careful with MMSI, check out our full research report (it’s free).
Albertsons (ACI)
One-Month Return: -0.9%
With over 20 well-known grocery banners spanning 34 states, Albertsons (NYSE: ACI) operates food and drug retail stores across the US, offering groceries, pharmacy services, and own-brand products under banners like Safeway, Jewel-Osco, and Vons.
Why Do We Steer Clear of ACI?
- Lack of new stores puts a ceiling on its growth and reflects a focus on optimizing sales at existing locations
- Gross margin of 27.5% is below its competitors, leaving less money for marketing and promotions
- Poor expense management has led to an operating margin of 2% that is below the industry average
At $16.45 per share, Albertsons trades at 7.4x forward P/E. Read our free research report to see why you should think twice about including ACI in your portfolio.
One Stock to Watch:
Stryker (SYK)
One-Month Return: -10.6%
With over 150 million patients impacted annually through its innovative healthcare technologies, Stryker (NYSE: SYK) develops and manufactures advanced medical devices and equipment across orthopedics, surgical tools, neurotechnology, and patient care solutions.
Why Could SYK Be a Winner?
- Existing business lines can expand without risky acquisitions as its organic revenue growth averaged 9.2% over the past two years
- Earnings per share grew by 12.2% annually over the last five years, comfortably beating the peer group average
- Free cash flow margin jumped by 4 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Stryker’s stock price of $305.13 implies a valuation ratio of 19.3x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
