The low valuation multiples for value stocks provide a margin of safety that growth stocks rarely offer. However, the challenge lies in determining whether these cheap assets are genuinely undervalued or simply on sale due to their potentially deteriorating business models.
This distinction between true value and value traps can challenge even the most skilled investors. Luckily for you, we started StockStory to help you uncover exceptional companies. Keeping that in mind, here are three value stocks climbing an uphill battle and some other investments you should look into instead.
ON24 (ONTF)
Forward P/S Ratio: 1.9x
Powering over 1,700 companies' virtual marketing efforts since 1998, ON24 (NYSE: ONTF) provides a cloud-based platform that enables businesses to create interactive digital experiences and capture actionable data from customer engagement.
Why Is ONTF Risky?
- Products, pricing, or go-to-market strategy need some adjustments as its billings have averaged 8.1% declines over the last year
- Sales are projected to tank by 5.1% over the next 12 months as its demand continues evaporating
- Poor expense management has led to operating margin losses
ON24 is trading at $5.81 per share, or 1.9x forward price-to-sales. Dive into our free research report to see why there are better opportunities than ONTF.
B&G Foods (BGS)
Forward P/E Ratio: 8.8x
Started as a small grocery store in New York City, B&G Foods (NYSE: BGS) is an American packaged foods company with a diverse portfolio of more than 50 brands.
Why Do We Steer Clear of BGS?
- Annual revenue declines of 4.5% over the last three years indicate problems with its market positioning
- Earnings per share decreased by more than its revenue over the last three years, showing each sale was less profitable
- High net-debt-to-EBITDA ratio of 7× increases the risk of forced asset sales or dilutive financing if operational performance weakens
B&G Foods’s stock price of $4.74 implies a valuation ratio of 8.8x forward P/E. If you’re considering BGS for your portfolio, see our FREE research report to learn more.
AT&T (T)
Forward P/E Ratio: 11.3x
Founded by Alexander Graham Bell, AT&T (NYSE: T) is a multinational telecomm conglomerate providing a range of communications and internet services.
Why Are We Out on T?
- Products and services have few die-hard fans as sales have declined by 5.6% annually over the last five years
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 2.3 percentage points over the next year
- Returns on capital are increasing as management makes relatively better investment decisions
At $24.33 per share, AT&T trades at 11.3x forward P/E. Read our free research report to see why you should think twice about including T in your portfolio.
Stocks We Like More
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-small-cap company Exlservice (+354% 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.
