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 downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. Keeping that in mind, here are three stocks under $10 to avoid and some other investments you should consider instead.
Sprinklr (CXM)
Share Price: $5.46
With a proprietary AI engine processing 450 million data points daily across 30+ digital channels, Sprinklr (NYSE: CXM) provides cloud-based software that helps large enterprises manage customer experiences across social, messaging, chat, and voice channels.
Why Do We Think CXM Will Underperform?
- Products, pricing, or go-to-market strategy may need some adjustments as its 6.9% average billings growth over the last year was weak
- Estimated sales growth of 4.1% for the next 12 months implies demand will slow from its two-year trend
- Static operating margin over the last year shows it couldn’t become more efficient
At $5.46 per share, Sprinklr trades at 1.6x forward price-to-sales. Check out our free in-depth research report to learn more about why CXM doesn’t pass our bar.
1-800-FLOWERS (FLWS)
Share Price: $3.70
Founded in 1976, 1-800-FLOWERS (NASDAQ: FLWS) is an online retailer of flowers, gifts, and gourmet foods, serving customers globally.
Why Is FLWS Risky?
- Products and services aren't resonating with the market as its revenue declined by 3.1% annually over the last five years
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
- High net-debt-to-EBITDA ratio of 11× could force the company to raise capital at unfavorable terms if market conditions deteriorate
1-800-FLOWERS’s stock price of $3.70 implies a valuation ratio of 0.2x forward price-to-sales. To fully understand why you should be careful with FLWS, check out our full research report (it’s free).
Purple (PRPL)
Share Price: $0.71
Founded by two brothers, Purple (NASDAQ: PRPL) creates sleep and home comfort products such as mattresses, pillows, and bedding accessories.
Why Do We Avoid PRPL?
- Products and services have few die-hard fans as sales have declined by 5.3% annually over the last five years
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
Purple is trading at $0.71 per share, or 17.3x forward EV-to-EBITDA. If you’re considering PRPL for your portfolio, see our FREE research report to learn more.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
