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. Keeping that in mind, here are two stocks under $50 with huge potential and one that may have trouble.
One Stock Under $50 to Sell:
DXC (DXC)
Share Price: $18.22
Born from the 2017 merger of Computer Sciences Corporation and HP Enterprise's services business, DXC Technology (NYSE: DXC) is a global IT services company that helps businesses transform their operations through technology solutions, cloud infrastructure, and cybersecurity services.
Why Should You Sell DXC?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Earnings per share have dipped by 11.5% annually over the past five years, which is concerning because stock prices follow EPS over the long term
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
At $18.22 per share, DXC trades at 5.7x forward price-to-earnings. Check out our free in-depth research report to learn more about why DXC doesn’t pass our bar.
Two Stocks Under $50 to Watch:
American Superconductor (AMSC)
Share Price: $19.55
Founded in 1987, American Superconductor (NASDAQ: AMSC) has shifted from superconductor research to developing power systems, adapting to changing energy grid needs and naval technology requirements.
Why Is AMSC a Good Business?
- Impressive 39% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Free cash flow turned positive over the last five years, indicating the company has achieved financial self-sustainability
- Improving returns on capital suggest its past investments are beginning to deliver value
American Superconductor is trading at $19.55 per share, or 48.3x forward price-to-earnings. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Option Care Health (OPCH)
Share Price: $34.12
Founded in 1979, Option Care Health (NASDAQ: OPCH) delivers home and alternate site infusion therapy services, specializing in the administration of medications and care for patients with chronic and acute conditions.
Why Do We Like OPCH?
- Impressive 16.7% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 75.4% exceeded its revenue gains over the last five years
- Free cash flow margin increased by 2.4 percentage points over the last five years, giving the company more capital to invest or return to shareholders
Option Care Health’s stock price of $34.12 implies a valuation ratio of 27.5x forward price-to-earnings. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
The Trump trade may have passed, but rates are still dropping and inflation is still cooling. Opportunities are ripe for those ready to act - and we’re here to help you pick them.
Get started by checking out our Top 9 Market-Beating Stocks. 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 United Rentals (+322% five-year return). Find your next big winner with StockStory today for free.
