Stocks in the $10-50 range offer a sweet spot between affordability and stability as they’re typically more established than penny stocks. But their headline prices don’t guarantee quality, and investors should exercise caution as some have shaky business models.
This is precisely where StockStory comes in - we do the heavy lifting to identify companies with solid fundamentals so you can invest with confidence. That said, here are three stocks under $50 to avoid and some other investments you should consider instead.
MGM Resorts (MGM)
Share Price: $29.73
Operating several properties on the Las Vegas Strip, MGM Resorts (NYSE: MGM) is a global hospitality and entertainment company known for its resorts and casinos.
Why Should You Sell MGM?
- Sizable revenue base leads to growth challenges as its 6% annual revenue increases over the last five years fell short of other consumer discretionary companies
- Demand will likely fall over the next 12 months as Wall Street expects flat revenue
- 12× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
MGM Resorts’s stock price of $29.73 implies a valuation ratio of 13.3x forward price-to-earnings. Check out our free in-depth research report to learn more about why MGM doesn’t pass our bar.
Delta Air Lines (DAL)
Share Price: $41.48
One of the ‘Big Four’ airlines in the US, Delta Air Lines (NYSE: DAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.
Why Do We Avoid DAL?
- Demand for its offerings was relatively low as its number of revenue passenger miles has underwhelmed
- Earnings per share fell by 6.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Low returns on capital reflect management’s struggle to allocate funds effectively
Delta Air Lines is trading at $41.48 per share, or 5.7x forward price-to-earnings. Read our free research report to see why you should think twice about including DAL in your portfolio.
Diebold Nixdorf (DBD)
Share Price: $42.51
With roots dating back to 1859 and a presence in over 100 countries, Diebold Nixdorf (NYSE: DBD) provides automated self-service technology, software, and services that help banks and retailers digitize their customer transactions.
Why Are We Wary of DBD?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 3.2% annually over the last five years
- Sales are projected to remain flat over the next 12 months as demand decelerates from its two-year trend
- Cash burn makes us question whether it can achieve sustainable long-term growth
At $42.51 per share, Diebold Nixdorf trades at 9x forward price-to-earnings. If you’re considering DBD for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free.
