Stocks under $10 pique our interest because they have room to grow (as well as the most affordable option contract premiums). That doesn’t mean they’re bargains though, and we urge investors to be careful as many have risky business models.
The bad behavior exhibited by lower-quality companies in this space can spook even the most seasoned professionals, which is why we started StockStory - to separate the good from the bad. Keeping that in mind, here are three stocks under $10 to avoid and some other investments you should consider instead.
Offerpad (OPAD)
Share Price: $0.73
Known for giving homeowners cash offers within 24 hours, Offerpad (NYSE: OPAD) operates a tech-enabled platform specializing in direct home buying and selling solutions.
Why Do We Pass on OPAD?
- Demand for its offerings was relatively low as its number of homes sold has underwhelmed
- Poor free cash flow margin of 6.9% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- Unprofitable operations could lead to additional rounds of dilutive equity financing if the credit window closes
Offerpad is trading at $0.73 per share, or 0.1x forward price-to-sales. Dive into our free research report to see why there are better opportunities than OPAD.
ChargePoint (CHPT)
Share Price: $8.25
The most prominent EV charging company during the COVID bull market, ChargePoint (NYSE: CHPT) is a provider of electric vehicle charging technology solutions in North America and Europe.
Why Is CHPT Not Exciting?
- Annual sales declines of 7.3% for the past two years show its products and services struggled to connect with the market during this cycle
- Cash-burning history makes us doubt the long-term viability of its business model
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
At $8.25 per share, ChargePoint trades at 0.4x forward price-to-sales. Check out our free in-depth research report to learn more about why CHPT doesn’t pass our bar.
Rumble (RUM)
Share Price: $8.29
Founded in 2013 as a champion for content creator rights and free expression, Rumble (NASDAQ: RUM) is a video sharing platform that positions itself as a free speech alternative to mainstream platforms, offering creators more favorable revenue-sharing opportunities.
Why Are We Wary of RUM?
- Revenue base of $102.4 million indicates it’s still subscale compared to its larger peers (though this creates opportunities to expand into untapped markets)
- Negative free cash flow raises questions about the return timeline for its investments
- EBITDA losses may force it to accept punitive lending terms or high-cost debt
Rumble’s stock price of $8.29 implies a valuation ratio of 21.2x trailing 12-month price-to-sales. Read our free research report to see why you should think twice about including RUM in your portfolio.
High-Quality Stocks for All Market Conditions
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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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
