Stocks trading in the $1-10 range are generally smaller players with less risk than their penny stock counterparts. But that doesn’t mean the underlying businesses are cheap, and we advise caution as many have questionable fundamentals.
The bad behavior exhibited by lower-quality companies in this space can spook even the most seasoned professionals, which is why we started StockStory - to separate the good from the bad. That said, here is one stock under $10 with explosive upside potential and two that could be down big.
Two Stocks Under $10 to Sell:
Krispy Kreme (DNUT)
Share Price: $3.27
Famous for its Original Glazed doughnuts and parent company of Insomnia Cookies, Krispy Kreme (NASDAQ:DNUT) is one of the most beloved and well-known fast-food chains in the world.
Why Is DNUT Risky?
- 6.2% annual revenue growth over the last seven years was slower than its restaurant peers
- Cash burn makes us question whether it can achieve sustainable long-term growth
- High net-debt-to-EBITDA ratio of 8× could force the company to raise capital on unfavorable terms if market conditions deteriorate
Krispy Kreme’s stock price of $3.27 implies a valuation ratio of 149.8x forward P/E. Check out our free in-depth research report to learn more about why DNUT doesn’t pass our bar.
Kosmos Energy (KOS)
Share Price: $2.47
Operating in some of the world's deepest waters with projects located up to 120 kilometers offshore, Kosmos Energy (NYSE:KOS) explores for, develops, and produces oil and natural gas from deepwater offshore fields.
Why Does KOS Fall Short?
- Annual revenue growth of 8.4% over the last five years was below our standards for the energy upstream and integrated energy sector
- Day-to-day expenses have swelled relative to revenue over the last five years as its EBITDA margin fell by 3.9 percentage points
- Negative free cash flow raises questions about the return timeline for its investments
At $2.47 per share, Kosmos Energy trades at 5.9x forward P/E. To fully understand why you should be careful with KOS, check out our full research report (it’s free).
One Stock Under $10 to Watch:
Gevo (GEVO)
Share Price: $1.55
Operating one of the largest dairy-based renewable natural gas facilities in the United States, Gevo (NASDAQ:GEVO) produces sustainable aviation fuel and other renewable hydrocarbon fuels from plant-based feedstocks like corn.
Why Could GEVO Be a Winner?
- Annual revenue growth of 19.6% over the last ten years was superb and indicates its market share increased during this cycle
- EBITDA margin expanded by 8,384.8 percentage points over the last five years as it scaled and became more efficient
Gevo is trading at $1.55 per share, or 9.4x forward EV-to-EBITDA. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even 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.
Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
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 Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
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