The $10-50 price range often includes mid-sized businesses with proven track records and plenty of growth runway ahead. They also usually carry less risk than penny stocks, though they’re not immune to volatility as many lack the scale advantages of their larger peers.
These dynamics can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. That said, here are three stocks under $50 to avoid and some other investments you should consider instead.
Photronics (PLAB)
Share Price: $32.88
Sporting a global footprint of facilities, Photronics (NASDAQ: PLAB) is a manufacturer of photomasks, templates used to transfer patterns onto semiconductor wafers.
Why Are We Hesitant About PLAB?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.4% annually over the last two years
- Estimated sales growth of 4.1% for the next 12 months is soft and implies weaker demand
- Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 35.9%
Photronics’s stock price of $32.88 implies a valuation ratio of 15.4x forward P/E. Check out our free in-depth research report to learn more about why PLAB doesn’t pass our bar.
CarMax (KMX)
Share Price: $45.12
Known for its transparent, customer-centric approach and wide selection of vehicles, Carmax (NYSE: KMX) is the largest automotive retailer in the United States.
Why Do We Steer Clear of KMX?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Gross margin of 11% is below its competitors, leaving less money for marketing and promotions
- 16× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
At $45.12 per share, CarMax trades at 19.2x forward P/E. To fully understand why you should be careful with KMX, check out our full research report (it’s free).
STAAR Surgical (STAA)
Share Price: $22.12
With over 2.5 million implants performed worldwide, STAAR Surgical (NASDAQ: STAA) designs and manufactures implantable lenses that correct vision problems without removing the eye's natural lens.
Why Do We Pass on STAA?
- Constant currency revenue growth has disappointed over the past two years and shows demand was soft
- 37.3 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
- Waning returns on capital imply its previous profit engines are losing steam
STAAR Surgical is trading at $22.12 per share, or 44.6x forward P/E. Dive into our free research report to see why there are better opportunities than STAA.
Stocks We Like More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 244% over the last five years (as of June 30, 2025).
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.
