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.
Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. Keeping that in mind, here are three stocks under $50 to swipe left on and some alternatives you should look into instead.
LKQ (LKQ)
Share Price: $42.05
A global distributor of vehicle parts and accessories, LKQ (NASDAQ: LKQ) offers its customers a comprehensive selection of high-quality, affordably priced automobile products.
Why Do We Think LKQ Will Underperform?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Estimated sales growth of 2% for the next 12 months implies demand will slow from its two-year trend
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
LKQ’s stock price of $42.05 implies a valuation ratio of 11.5x forward P/E. Read our free research report to see why you should think twice about including LKQ in your portfolio.
Rocket Lab (RKLB)
Share Price: $21.89
Becoming the first private company in the Southern Hemisphere to reach space, Rocket Lab (NASDAQ: RKLB) offers rockets designed for launching small satellites.
Why Are We Cautious About RKLB?
- Issuance of new shares over the last two years caused its earnings per share to fall by 24.4% annually while its revenue grew
- Cash burn makes us question whether it can achieve sustainable long-term growth
- Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders
Rocket Lab is trading at $21.89 per share, or 17.7x forward price-to-sales. To fully understand why you should be careful with RKLB, check out our full research report (it’s free).
Cognex (CGNX)
Share Price: $32.09
Founded in 1981 when computer vision was in its infancy, Cognex (NASDAQ: CGNX) develops machine vision systems and software that help manufacturers and logistics companies automate quality inspection and tracking of products.
Why Do We Steer Clear of CGNX?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 12.2 percentage points
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $32.09 per share, Cognex trades at 35x forward P/E. Check out our free in-depth research report to learn more about why CGNX doesn’t pass our bar.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free.
