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 downside that can come from buying these securities is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. Keeping that in mind, here are three stocks under $10 to pass on and some alternatives you should look into instead.
Clarus (CLAR)
Share Price: $3.59
Initially a financial services business, Clarus (NASDAQ:CLAR) designs, manufactures, and distributes outdoor equipment and lifestyle products.
Why Do We Steer Clear of CLAR?
- Annual revenue declines of 2.6% over the last five years indicate problems with its market positioning
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of -0.7% for the last two years
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Clarus’s stock price of $3.59 implies a valuation ratio of 33.6x forward P/E. Dive into our free research report to see why there are better opportunities than CLAR.
Concrete Pumping (BBCP)
Share Price: $9.72
Going public via SPAC in 2018, Concrete Pumping (NASDAQ:BBCP) is a provider of concrete pumping and waste management services in the United States and the United Kingdom.
Why Is BBCP Not Exciting?
- Sales tumbled by 1.4% annually over the last two years, showing market trends are working against it during this cycle
- Earnings per share have contracted by 19.3% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance
- Low returns on capital reflect management’s struggle to allocate funds effectively
At $9.72 per share, Concrete Pumping trades at 32.7x forward P/E. Check out our free in-depth research report to learn more about why BBCP doesn’t pass our bar.
EVgo (EVGO)
Share Price: $1.53
Created through a settlement between NRG Energy and the California Public Utilities Commission, EVgo (NASDAQ:EVGO) is a provider of electric vehicle charging solutions, operating fast charging stations across the United States.
Why Are We Cautious About EVGO?
- Suboptimal cost structure is highlighted by its history of operating margin losses
- Negative free cash flow raises questions about the return timeline for its investments
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
EVgo is trading at $1.53 per share, or 0.5x forward price-to-sales. Read our free research report to see why you should think twice about including EVGO in your portfolio.
High-Quality Stocks for All Market Conditions
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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-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.