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.
Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. That said, here are three stocks under $10 to avoid and some other investments you should consider instead.
Gray Television (GTN)
Share Price: $4.07
Specializing in local media coverage, Gray Television (NYSE:GTN) is a broadcast company supplying digital media to various markets in the United States.
Why Do We Steer Clear of GTN?
- Muted 5.2% annual revenue growth over the last five years shows its demand lagged behind its consumer discretionary peers
- ROIC hasn’t moved, making investors question whether its recent investments can increase profitability
- 9× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings
Gray Television is trading at $4.07 per share, or 5.8x forward EV-to-EBITDA. To fully understand why you should be careful with GTN, check out our full research report (it’s free).
DXC (DXC)
Share Price: $9.56
Born from the 2017 merger of Computer Sciences Corporation and HP Enterprise's services business, DXC Technology (NYSE:DXC) is a global IT services company that helps businesses transform their technology infrastructure, applications, and operations.
Why Do We Pass on DXC?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Sales are projected to tank by 3.8% over the next 12 months as its demand continues evaporating
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
At $9.56 per share, DXC trades at 3.5x forward P/E. Read our free research report to see why you should think twice about including DXC in your portfolio.
Ladder Capital (LADR)
Share Price: $9.86
Founded during the 2008 financial crisis when traditional lenders retreated from commercial real estate, Ladder Capital (NYSE:LADR) is a real estate investment trust that originates commercial real estate loans, owns commercial properties, and invests in real estate securities.
Why Are We Cautious About LADR?
- Sales tumbled by 8.3% annually over the last two years, showing market trends are working against it during this cycle
- Sales were less profitable over the last two years as its earnings per share fell by 17.9% annually, worse than its revenue declines
- Flat tangible book value per share over the last five years suggests it must find different ways to enhance shareholder value during this cycle
Ladder Capital’s stock price of $9.86 implies a valuation ratio of 0.9x forward P/B. Dive into our free research report to see why there are better opportunities than LADR.
Stocks We Like More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.