Investors can certainly boost their returns by concentrating on stocks trading between $1 and $10. However, a disciplined approach is necessary because many of these businesses are speculative and lack the underlying fundamentals to support their prices.
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. That said, here are three stocks under $10 to swipe left on and some alternatives you should look into instead.
ThredUp (TDUP)
Share Price: $9.04
Founded to revolutionize thrifting, ThredUp (NASDAQ: TDUP) is a leading online fashion resale marketplace offering a wide selection of gently-used clothing and accessories.
Why Do We Think TDUP Will Underperform?
- Demand for its offerings was relatively low as its number of orders has underwhelmed
- Historical operating margin losses point to an inefficient cost structure
- Cash-burning history makes us doubt the long-term viability of its business model
ThredUp is trading at $9.04 per share, or 86.2x forward EV-to-EBITDA. If you’re considering TDUP for your portfolio, see our FREE research report to learn more.
Portillo's (PTLO)
Share Price: $6.47
Begun as a Chicago hot dog stand in 1963, Portillo’s (NASDAQ: PTLO) is a casual restaurant chain that serves Chicago-style hot dogs and beef sandwiches as well as fries and shakes.
Why Does PTLO Worry Us?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its menu offerings and dining experience
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of -0.4% for the last two years
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
Portillo’s stock price of $6.47 implies a valuation ratio of 16.3x forward P/E. Check out our free in-depth research report to learn more about why PTLO doesn’t pass our bar.
Leggett & Platt (LEG)
Share Price: $8.76
Founded in 1883, Leggett & Platt (NYSE: LEG) is a diversified manufacturer of products and components for various industries.
Why Do We Avoid LEG?
- Products and services fail to spark excitement with consumers, as seen in its flat sales over the last five years
- Earnings per share fell by 11.8% annually over the last five years while its revenue was flat, showing each sale was less profitable
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
At $8.76 per share, Leggett & Platt trades at 7.5x forward P/E. Read our free research report to see why you should think twice about including LEG in your portfolio.
Stocks We Like 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 Comfort Systems (+782% 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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