Stocks trading between $10 and $50 can be particularly interesting as they frequently represent businesses that have survived their early challenges. However, investors should remain vigilant as some may still have unproven business models, leaving them vulnerable to the ebbs and flows of the broader market.
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. Keeping that in mind, here are three stocks under $50 to avoid and some other investments you should consider instead.
First Advantage (FA)
Share Price: $21.04
Processing over 200 million screens annually across more than 200 countries and territories, First Advantage (NASDAQ: FA) provides employment background screening, identity verification, and compliance solutions to help companies manage hiring risks.
Why Are We Hesitant About FA?
- Earnings growth underperformed the sector average over the last four years as its EPS grew by just 1.6% annually
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 7.9 percentage points
- Underwhelming 1.1% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its decreasing returns suggest its historical profit centers are aging
First Advantage’s stock price of $21.04 implies a valuation ratio of 15x forward P/E. Dive into our free research report to see why there are better opportunities than FA.
FirstSun Capital Bancorp (FSUN)
Share Price: $39.03
Tracing its roots back to 1892 when it first opened its doors in Kansas, FirstSun Capital Bancorp (NASDAQ: FSUN) operates Sunflower Bank, providing commercial and consumer banking services to businesses and individuals across the Southwest region.
Why Does FSUN Give Us Pause?
- Sales trends were unexciting over the last five years as its 7.4% annual growth was below the typical banking company
- Tangible book value per share is projected to decrease by 2.8% over the next 12 months as capital generation weakens
- Low return on equity reflects management’s struggle to allocate funds effectively
FirstSun Capital Bancorp is trading at $39.03 per share, or 0.9x forward P/B. Read our free research report to see why you should think twice about including FSUN in your portfolio.
Murphy Oil (MUR)
Share Price: $31.89
Operating in waters over a mile deep in the Gulf of Mexico and extracting hydrocarbons from tight shale rock formations in Texas, Murphy Oil (NYSE: MUR) explores for and produces crude oil, natural gas, and natural gas liquids from fields in North America and Asia.
Why Are We Cautious About MUR?
- Efficiency has decreased over the last five years as its EBITDA margin fell by 11.7 percentage points
At $31.89 per share, Murphy Oil trades at 7.1x forward P/E. If you’re considering MUR for your portfolio, see our FREE research report to learn more.
High-Quality Stocks for All Market Conditions
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 (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
