Stocks in the $10-$50 range offer a balance between affordability and stability as they are often more established than penny stocks. But their headline prices do not guarantee quality and investors should be cautious as some have unstable business models.
These dynamics can give even the most seasoned professionals a headache, which is why we started StockStory – to help you distinguish the good companies from the bad. Keeping that in mind, here are two stocks under $50 with big upside potential and one that could be in trouble.
Stock price: $13.55
With a network of more than 650 communities serving approximately 59,000 residents across 41 states, Brookdale Senior Living (NYSE:BKD) operates senior living communities across the United States, providing independent living, assisted living, memory care and continuing care retirement communities.
Why do we have to think carefully about BKD?
-
Customers are postponing purchases of the company’s products and services during this cycle as the company’s revenue has decreased by 2% per year over the past five years.
-
The forecast for revenue to decline 5.9% over the next 12 months implies a decline in demand
-
An 11× net debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially leading to dilutive equity issuances
Brookdale is trading at $13.55 per share, or 16.8x forward EV-to-EBITDA. If you’re considering BKD for your portfolio, check out our FREE research report to learn more.
Stock price: 34.77 USD
Pioneering the concept of “flexible aerospace” with hundreds of small but powerful satellites, Planet Labs (NYSE:PL) operates the world’s largest fleet of Earth observation satellites, capturing daily images of our planet to provide insights on deforestation, agriculture and climate change.
Why do we support PL?
-
Demand is greater than supply as the company’s 157% average backlog growth over the past two years suggests it is securing new contracts and accumulating more orders than it can fill
-
Rising sales have significantly boosted profits as annual earnings per share growth of 65.4% over the past two years outpaced revenue performance.
-
Free cash flow has turned positive over the past five years, suggesting the company is at an important crossroads
Planet Labs’ share price of $34.77 implies a valuation ratio of 1,345.4 times EV to forward EBITDA. Is now the right time to buy? See our full research report for yourself, it’s completely free.
Stock price: $21.31
Founded in 1871 as one of the oldest financial institutions in the Chicago area, Old Second Bancorp (NASDAQ:OSBC) is an Illinois-based community bank offering deposits, commercial and consumer lending, wealth management and mortgage products through 53 branch locations.