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Stocks trading between $10 and $50 can be particularly interesting as they frequently represent businesses that have survived their early challenges. However, investors should remain vigilant as some may still have unproven business models, leaving them vulnerable to the ebbs and flows of the broader market.

These dynamics can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. Keeping that in mind, here are three stocks under $50 to avoid and some other investments you should consider instead.

Papa John's (PZZA)

Share Price: $38.66

Founded by the eclectic John “Papa John” Schnatter, Papa John’s (NASDAQ:PZZA) is a globally recognized pizza delivery and carryout chain known for “better ingredients” and “better pizza”.

Why Does PZZA Fall Short?

1. Disappointing same-store sales over the past two years show customers aren’t responding well to its menu offerings and dining experience

2. Estimated sales growth of 2.6% for the next 12 months implies demand will slow from its six-year trend

3. Challenging supply chain dynamics and bad unit economics are reflected in its low gross margin of 17.3%

Papa John’s stock price of $38.66 implies a valuation ratio of 18.8x forward P/E. If you’re considering PZZA for your portfolio, see our FREE research report to learn more.

Flowers Foods (FLO)

Share Price: $17.26

With Wonder Bread as its premier brand, Flower Foods (NYSE:FLO) is a packaged foods company that focuses on bakery products such as breads, buns, and cakes.

Why Does FLO Give Us Pause?

1. Declining unit sales over the past two years show it’s struggled to move its products and had to rely on price increases

2. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth

3. Earnings growth over the last three years fell short of the peer group average as its EPS only increased by 1.2% annually

At $17.26 per share, Flowers Foods trades at 13.2x forward P/E. Read our free research report to see why you should think twice about including FLO in your portfolio, it’s free.

Utz (UTZ)

Share Price: $12.31

Tracing its roots back to 1921 when Bill and Salie Utz began making potato chips in their kitchen, Utz Brands (NYSE:UTZ) offers salty snacks such as potato chips, tortilla chips, pretzels, cheese snacks, and ready-to-eat popcorn, among others.

Why Are We Out on UTZ?

1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy

2. Subscale operations are evident in its revenue base of $1.41 billion, meaning it has fewer distribution channels than its larger rivals

3. Underwhelming 0.6% return on capital reflects management’s difficulties in finding profitable growth opportunities