Stocks trading in the $1-10 range are generally smaller players with less risk than their penny stock counterparts. But that doesn’t mean the underlying businesses are cheap, and we advise caution as many have questionable fundamentals.
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. That said, here are two stocks under $10 that could 100x and one that could be down big.
One Stock Under $10 to Sell:
Sleep Number (SNBR)
Share Price: $5.45
Known for mattresses that can be adjusted with regards to firmness, Sleep Number (NASDAQ: SNBR) manufactures and sells its own brand of bedding products such as mattresses, bed frames, and pillows.
Why Do We Steer Clear of SNBR?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Estimated sales decline of 5.7% for the next 12 months implies an even more challenging demand environment
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
Sleep Number’s stock price of $5.45 implies a valuation ratio of 36x forward P/E. To fully understand why you should be careful with SNBR, check out our full research report (it’s free for active Edge members).
Two Stocks Under $10 to Watch:
Semrush (SEMR)
Share Price: $7.13
Born from the need to make sense of the complex digital marketing landscape, Semrush (NYSE: SEMR) is a software-as-a-service platform that helps companies improve their online visibility, analyze digital marketing efforts, and optimize content across search engines and social media.
Why Do We Like SEMR?
- Average billings growth of 23% over the last year enhances its liquidity and shows there is steady demand for its products
- Prominent and differentiated software leads to a premier gross margin of 81.4%
- Free cash flow margin is anticipated to expand by 7.1 percentage points over the next year, providing additional flexibility for investments and share buybacks/dividends
Semrush is trading at $7.13 per share, or 2.2x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
AvidXchange (AVDX)
Share Price: $9.99
Born from the frustration of paper-based accounting processes in the early 2000s, AvidXchange (NASDAQ: AVDX) provides accounts payable automation software and payment solutions that help middle-market businesses digitize and streamline their invoice processing and payments.
Why Could AVDX Be a Winner?
- Impressive 20.7% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 65.9% annually, topping its revenue gains
At $9.99 per share, AvidXchange trades at 4.6x trailing 12-month price-to-sales. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free for active Edge members.
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
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 183% over the last five years (as of March 31st 2025).
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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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