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.
Kulicke and Soffa (KLIC)
Share Price: $33.41
Headquartered in Singapore, Kulicke & Soffa (NASDAQ: KLIC) is a provider of production equipment and tools used to assemble semiconductor devices
Why Do We Steer Clear of KLIC?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 17.2% annually over the last two years
- Sales are projected to tank by 8.8% over the next 12 months as its demand continues evaporating
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 16.4 percentage points
Kulicke and Soffa’s stock price of $33.41 implies a valuation ratio of 19.8x forward P/E. To fully understand why you should be careful with KLIC, check out our full research report (it’s free).
Dine Brands (DIN)
Share Price: $24.67
Operating a franchise model, Dine Brands (NYSE: DIN) is a casual restaurant chain that owns the Applebee’s and IHOP banners.
Why Should You Dump DIN?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Earnings per share fell by 10.1% annually over the last six years while its revenue was flat, showing each sale was less profitable
- 6× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
Dine Brands is trading at $24.67 per share, or 4.8x forward P/E. Read our free research report to see why you should think twice about including DIN in your portfolio.
Kraft Heinz (KHC)
Share Price: $26.72
The result of a 2015 mega-merger between Kraft and Heinz, Kraft Heinz (NASDAQ: KHC) is a packaged foods giant whose products span coffee to cheese to packaged meat.
Why Do We Pass on KHC?
- Falling unit sales over the past two years suggest it might have to lower prices to stimulate growth
- Estimated sales decline of 1.6% for the next 12 months implies an even more challenging demand environment
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 11.2 percentage points
At $26.72 per share, Kraft Heinz trades at 10x forward P/E. If you’re considering KHC for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 6 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.
