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 bad behavior exhibited by lower-quality companies in this space can spook even the most seasoned professionals, which is why we started StockStory - to separate the good from the bad. That said, here are three stocks under $10 to avoid and some other investments you should consider instead.
eXp World (EXPI)
Share Price: $9.36
Founded in 2009, eXp World (NASDAQ: EXPI) is a real estate company known for its virtual, cloud-based approach to real estate brokerage.
Why Do We Pass on EXPI?
- Number of transactions has disappointed over the past two years, indicating weak demand for its offerings
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 25% annually while its revenue grew
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 3.4% for the last two years
At $9.36 per share, eXp World trades at 17.5x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than EXPI.
Hudson Technologies (HDSN)
Share Price: $6.87
Founded in 1991, Hudson Technologies (NASDAQ: HDSN) specializes in refrigerant services and solutions, providing refrigerant sales, reclamation, and recycling.
Why Are We Hesitant About HDSN?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 9.9% annually over the last two years
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
- Diminishing returns on capital suggest its earlier profit pools are drying up
Hudson Technologies’s stock price of $6.87 implies a valuation ratio of 7.6x forward EV-to-EBITDA. If you’re considering HDSN for your portfolio, see our FREE research report to learn more.
American Outdoor Brands (AOUT)
Share Price: $8.17
Spun off from Smith and Wesson in 2020, American Outdoor Brands (NASDAQ: AOUT) is an outdoor and recreational products company that offers outdoor and shooting sports products but does not sell firearms themselves.
Why Should You Dump AOUT?
- Sales were flat over the last five years, indicating it’s failed to expand its business
- Low free cash flow margin of 1.5% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
American Outdoor Brands is trading at $8.17 per share, or 36.8x forward P/E. Check out our free in-depth research report to learn more about why AOUT doesn’t pass our bar.
High-Quality Stocks for All Market Conditions
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 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-micro-cap company Kadant (+351% 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.
