Value stocks typically trade at discounts to the broader market, offering patient investors the opportunity to buy businesses when they’re out of favor. The key risk, however, is that these stocks are usually cheap for a reason, and a low valuation can reflect underlying business challenges rather than a genuine bargain.
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 is one value stock offering a compelling risk-reward profile and two with little support.
Two Value Stocks to Sell:
Envista (NVST)
Forward P/E Ratio: 14.5x
Uniting more than 30 trusted brands including Nobel Biocare, Ormco, and DEXIS under one corporate umbrella, Envista Holdings (NYSE: NVST) is a global dental products company that provides equipment, consumables, and specialized technologies for dental professionals.
Why Do We Steer Clear of NVST?
- Sales trends were unexciting over the last five years as its 3.4% annual growth was below the typical healthcare company
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 7% annually while its revenue grew
- Negative returns on capital show that some of its growth strategies have backfired, and its falling returns suggest its earlier profit pools are drying up
At $23.00 per share, Envista trades at 14.5x forward P/E. Read our free research report to see why you should think twice about including NVST in your portfolio.
Hercules Capital (HTGC)
Forward P/E Ratio: 8.5x
Named after the mythological hero known for his strength, Hercules Capital (NYSE: HTGC) is a business development company that provides debt financing to venture capital-backed and growth-stage technology and life sciences companies.
Why Does HTGC Give Us Pause?
- Earnings per share fell by 3.4% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable
- High net-debt-to-EBITDA ratio of 6× increases the risk of forced asset sales or dilutive financing if operational performance weakens
Hercules Capital’s stock price of $16.57 implies a valuation ratio of 8.5x forward P/E. If you’re considering HTGC for your portfolio, see our FREE research report to learn more.
One Value Stock to Buy:
Limbach (LMB)
Forward P/E Ratio: 12x
Established in 1901, Limbach (NASDAQ: LMB) provides integrated building systems solutions, including mechanical, electrical, and plumbing services.
Why Will LMB Outperform?
- Market share has increased this cycle as its 15.6% annual revenue growth over the last two years was exceptional
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 20% outpaced its revenue gains
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures, and its returns are climbing as it finds even more attractive growth opportunities
Limbach is trading at $51.33 per share, or 12x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
