The $10-50 price range often includes mid-sized businesses with proven track records and plenty of growth runway ahead. They also usually carry less risk than penny stocks, though they’re not immune to volatility as many lack the scale advantages of their larger peers.
Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. Keeping that in mind, here are three stocks under $50 to avoid and some other investments you should consider instead.
BILL (BILL)
Share Price: $38.64
Transforming the messy back-office financial operations that plague small business owners, BILL (NYSE: BILL) provides a cloud-based platform that automates accounts payable, accounts receivable, and expense management for small and midsize businesses.
Why Should You Sell BILL?
- Customers had second thoughts about committing to its platform over the last year as its average billings growth of 11.7% underwhelmed
- Long payback periods on sales and marketing expenses limit customer growth and signal the company operates in a highly competitive environment
- Operating margin failed to increase over the last year, indicating the company couldn’t optimize its expenses
At $38.64 per share, BILL trades at 2.2x forward price-to-sales. Dive into our free research report to see why there are better opportunities than BILL.
Q2 Holdings (QTWO)
Share Price: $47.74
With a platform powering digital services for approximately 25 million account holders across America, Q2 Holdings (NYSE: QTWO) provides cloud-based digital solutions that help financial institutions, fintechs, and alternative finance companies deliver modern banking experiences to their customers.
Why Is QTWO Not Exciting?
- Customers were hesitant to make long-term commitments to its software as its 11.2% average ARR growth over the last year was sluggish
- Estimated sales growth of 10.2% for the next 12 months implies demand will slow from its two-year trend
- Sky-high servicing costs result in an inferior gross margin of 54.1% that must be offset through increased usage
Q2 Holdings’s stock price of $47.74 implies a valuation ratio of 3.7x forward price-to-sales. Check out our free in-depth research report to learn more about why QTWO doesn’t pass our bar.
Matrix Service (MTRX)
Share Price: $11.87
Founded in Oklahoma, Matrix Service (NASDAQ: MTRX) provides engineering, fabrication, construction, and maintenance services primarily to the energy and industrial markets.
Why Are We Cautious About MTRX?
- Annual revenue growth of 1.1% over the last five years was below our standards for the industrials sector
- High input costs result in an inferior gross margin of 3.7% that must be offset through higher volumes
- Earnings per share fell by 21.4% annually over the last five years while its revenue grew, partly because it diluted shareholders
Matrix Service is trading at $11.87 per share, or 17.8x forward P/E. If you’re considering MTRX for your portfolio, see our FREE research report to learn more.
Stocks We Like More
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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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
